| A REALTORŪ
can help you find your perfect home, but only you can decide how much
you are willing to offer for it. The REALTORŪ can supply you with
information about the selling prices and marketing time of other houses
in the area.
Once you have
determined the amount you are willing to offer, the REALTORŪ will help
you prepare a written offer. In most transactions you will offer to
deposit earnest money with the escrow agent. Earnest money manifests
your sincerity in making a reasonable offer and abiding by the terms of
the written contract. Contract forms
Your
REALTORŪ will help you prepare an offer using standard forms. The
offer, if accepted, will become a binding contract. This document is
the most important paper you will sign because it lays out all the
terms of the transaction. It will contain such things as: - a legal description of the property,
- any property that will be transferred with the home, (blinds, curtains, fireplace screens, etc.)
- the price,
- financing conditions and contingencies,
- amount of earnest money deposit,
- name of the escrow agent and title company,
- proration of insurance, taxes, and interest,
- fees to be paid and who pays for which,
- rights to inspect the property and for repairs to be made,
- dates of closing and possession, and
- what happens if either party defaults on the contract.
Inspections and warranties
Before
signing the contract, take precautions to protect yourself against
unseen defects in the home. An inspection by a qualified inspector or
other professional can provide you with unbiased opinions about the
condition of components and systems in the property such as the
foundation, mechanical systems, plumbing systems, appliances, etc.
If you can,
accompany the inspector at the time the inspection is conducted. When
ordering the inspection, ask the inspector the approximate time needed
to complete the inspection so you can reserve sufficient time from your
schedule. Be sure to ask the inspector to detail the scope of the
inspection. Not every inspector inspects every component in a house.
For example, does the inspector inspect foundations, air conditioning
and heating units, roofs, swimming pools, septic tanks, etc.? The cost
of home inspection depends on the size of the home, but the price could
prove to be worth it. It's also a good idea to get a termite and other
wood destroying insect inspection.
You may also
want to investigate the possibility of buying a residential service
contract. Such a contract is an agreement with a residential service
company that certain items will be repaired by the company if such
items fail to function after you move in. If you buy a new home, the
builder may offer a warranty as well. Whether you buy a residential
service contract or receive any other warranty, find out how claims
will be processed and how any necessary repairs will be made.
Seller's options
The
REALTORŪ working with you will present the contract to the seller's
agent or seller. The seller has three options: accept, reject or make a
counter offer. A counter offer is a rejection of the offer with a
simultaneous offer from the seller to the buyer. If a seller makes a
counter offer to you, you then have three options: accept, reject, or
make another counter offer. Whoever makes an offer or counter offer is
giving the power of acceptance to the recipient of the offer or counter
offer. Binding contract
Once you and the seller unequivocally agree to the written terms and both of you sign, the document becomes a binding contract.
As
part of the contract you may have the right to have the property
inspected and certain repairs may be required to be completed. Be sure
that you pay close attention as to when certain items must be
completed. Otherwise, you may waive some contractual rights. For
example, the contract may provide for you to deliver a copy of the
inspection report to the seller within a specified time and to deliver
a list of the items you require to be repaired. If you fail to provide
the information within the specified time, the contract may provide
that you waived certain rights. The
contract may also set out other contingencies that have to be
satisfied. We cannot address all conditions and contingencies. Read the
contract carefully, know its terms and comply with its requirements
timely. If
repairs are required, the contract will specify who will bear the cost
of the repairs, who will arrange for the repairs, and when the repairs
must be made. Before you close, be sure that the condition of the
property meets the required condition specified in the contract.
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