While some people have experience purchasing a home, others are just getting familiar with the process. Some first-time home buyers don’t realize the amount of time required to find and secure their new place, leaving them with unrealistic expectations.
Making an offer on a home is just one of the many steps of the home-buying process. Although it may seem like a simple task, there’s a set procedure that you must follow. Seeking help from a licensed real estate professional is your best bet to securing your dream home at the right price.
Remember, every home-buying transaction begins with a written proposal.
Your real estate broker will understand the importance of making an offer on a home in writing, as oral agreements are difficult to track and even harder to defend in the event there is an issue when it comes time to close on the property.
The proposal constitutes an offer and contains specific items that will be included in the contract for sale, which is why it’s critical to put as much in writing as possible from the beginning. Brokers have a variety of standard real estate forms that are current with modern lending practices and legal requirements. In many cases, however, the actual contracts are drafted by separate attorneys representing the buyer and the seller; these attorneys incorporate the items agreed upon in the written offer.
Nearly every offer is accompanied by a good faith deposit that is typically held in escrow by an attorney. If the contract is accepted and the transaction completed, this money will go toward the purchase of the home. If the contract doesn’t come to fruition for valid legal reasons, or if the offer is declined, this deposit is refunded.
The negotiating process begins.
Oftentimes when you make an offer on a home, the seller will come back with a counter-offer. Thus, the negotiations begin. Turn to your real estate broker for advice. A good broker will have a feel for market values to ensure that the homes you are looking at are priced fairly and competitively. It’s wise to let the broker negotiate on your behalf when you do find a property that suits you. You don’t wait to overpay for the property, but you also don’t want to insult the seller and lose out on the purchase.
When an offer is accepted, it’s converted into a contract of sale.
A contact of sale includes every important details of your transaction, such as:
- the legal description of the property (address, section, block and lot);
- the sale price, negotiated terms;
- and a target date for closing on the property.
Details such as which party is responsible for certain disclosures, inspections and surveys, will be delineated in the contract and the financial requirements will be detailed as well. Any expenses related to maintaining the property such as real estate taxes or utilities will be pro-rated upon closing to ensure that the buyer begins paying on the closing date.
Keep in mind that the real estate broker you work with will impact your experience.
As you’ve noticed, most home purchases are facilitated by a real estate professional or broker, it’s important to work with someone who is willing to go above and beyond for his or her clients.
A good broker understands you and your family and will work to find the perfect situation within a comfortable budget range. Brokers typically know about properties coming on the market before they are listed and have working relationships with other firms that have inventory in your desired area. You should be able to focus on your responsibilities while your broker handles the contractual aspects of the transaction.
Looking to buy your first home on Long Island? Here are some first-time home-buyer programs to be aware of. Also check out some Long Island neighborhoods perfect for young families.