I Have An Offer on My House: Now What?
When you receive an offer on your house, it is imperative that you review it carefully. The offer tells you the price the buyer is willing to pay and under what terms. We will review the offer with you. You may also wish to consult with an attorney before you sign it, and it becomes a contract of sale.
A good offer is close to the list price, sometimes exactly your asking price. That just means you priced your home correctly.
If the offer is less than you wanted, look at the contract as a whole. Perhaps the buyer is assuming some of the closing expenses. Consider possession and financing terms, as well. You can also consider splitting the difference.
Remember that time on the market to find another buyer is an additional expense.
Once you’ve read the offer, you have several choices.
- Accept the terms with no changes and sign the offer.
- Make a counteroffer to the buyer by making some changes. In some cases, a series of counteroffers will take place before the final agreement is signed.
- Reject the offer entirely.
Once you’ve signed an offer, you may accept a backup offer if that buyer clearly understands the house is under contract. The backup offer becomes effective only if the first offer falls through and the transaction fails.
Price
- Consult with us to determine a price. We can estimate your proceeds – the sale price minus fees, taxes and insurance.
- Don’t be concerned if the offer you receive is exactly your asking price. It doesn’t mean you under-priced your home, but rather that you priced it accurately.
- If the price is less than you wanted, look at the contract as a whole. Perhaps the buyer is assuming some of the closing expenses. Consider possession and financing terms, as well.
- Consider splitting the difference if you and the buyer are within a few thousand dollars of each other. Remember that time on the market is an additional expense
Earnest Money
An earnest money deposit will be held by a third party until an agreement is reached or there is a closing between you and the buyer. At that time, the money is usually credited to the buyer and applied to the down payment. Until you accept his or her offer, the buyer may withdraw the offer and get the earnest money back. On the other hand, if the buyer fails to follow through with the contract once it’s accepted, you may be entitled to the earnest money. We can answer any questions you may have regarding earnest money.
Property Title
As part of the real estate contract process, you must prove to the buyer that you have a clear title on the house – that you own the property, and there are no legal claims against it. Through a title search, proof is provided.
- The insurance company may search the title through the owner’s policy of title insurance. Either the buyer’s insurance company or your own may conduct this.
- The abstract of title is a condensed history of a title to a property and a certification by the abstractor that the history is complete and accurate.
- The certificate of title is reviewed by an attorney who searches the title and issues an opinion that the title is clear.
- In some parts of the country, the Torrens system is used as a means of registering property. At closing, the duplicate Torrens certificate of title is turned over to the buyer.
Property Deed
Be prepared to transfer ownership of the property with a deed. A deed is a legal document that transfers the title (or ownership rights) of the property to the new owner. Most buyers will require a general warranty deed, in which you guarantee that no one will bring a claim against the title.
Conditions and Contingencies
Review the contract for special conditions requested by the buyer. A common condition is one in which the purchase of your home is contingent on the buyer selling his or her current home. The conditions may also be more specific, such as asking you to provide a survey of the property.
Provisions
Although it may be dry reading, it is important to carefully read the contract and go over details with us. Read the fine print in your contract to understand the provisions (or ground rules) of who pays for what in the context of the sale. For instance, the contract should explain who is responsible if there is damage to the house after the contract is signed. The responsible party will want to insure the property through the transition. You or the buyer may add special provisions to the standard ones.
Sale Specifics
Does the refrigerator stay or go? How about the drapes in the formal living room? Double-check that everything you intend to sell with the house is listed accurately in the contract. This may include items such as fixtures, window treatments and appliances.
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