Be A Wise Buyer.
Up to this point, you are pre-approved, determined your needs and budget, cruised Falmouth, hopefully found a good realtor, looked at many homes, learned values and are becoming educated. When zeroing in on a home, seriously consider the following: 1. what have similar homes recently sold for, 2. how long has it been on the market,
3. check out the neighborhood, 4. be objective about what you are doing - it is a business decision, and 5. consider resale value. All of these factors will impact your decision to buy and how much you will offer. Your realtor should help you with 1 & 2.
Other factors to consider. A home new to the market in good condition in a decent area and priced properly may sell quickly, often within days because many buyers have been waiting for such a home. It will probably sell for close to full price whereas a home that has been on the market for some time may have a motivated seller who is open to negotiation. It is important to understand the difference between these two because many buyers may try to negotiate a new listing and lose out to a wiser buyer. The rule is this case is "make your highest and best offer". Also, please don't dismiss too lightly a realtor's comment that "this home won't last" which usually refers to a nice home new to the market. The development of a trusting relationship with your realtor and a few loses does make for a wiser buyer.
The Offer to Purchase Real Estate begins with this statement "This is a Legally binding Contract. If not Understood, Seek Competent Advice". The fact that it is a signed agreement between two parties stating price and dates makes it so. It would be wise to hire an attorney when entering agreements like this, especially the first time.
The body of the form continues as follows:
1.sellers name/address lines, 2.property identification, 3.amount offered including deposit and downpayment, 4.dates for executing the agreement, 5.broker's fees,
6.contingency reference to Addendum A, 7.seller's acceptance paragraph, 8.signature and address lines, 9.receipt for deposit, 10.Addendum A attachment noting issues included in this offer such as home inspection, financing, Title V, and more, 11.Lead Paint form, and 12.Agency Disclosure form.
To help you get familiar with them, here are the forms used in making an Offer to Purchase Real Estate:
Offer to Purchase,
Addendum A, and
The Winning Offer.
The most acceptable offers to sellers are generally those with the highest price and the fewest contingencies. This is particularly true with a "hot property" when several offers are on the table. When in this situation ask yourself "what can I do to make the best offer". Can I make a larger downpayment, can I pay cash and get a mortgage after the closing, is a home inspection necessary, if this is a cash deal, can I close in a couple weeks? Get your realtors help to make yours "The Winning Offer".
The following is from the MA Association of Realtors Website:
Making an offer to purchase. Once you have found the house you want to buy, there are a number of procedures that must be followed to secure a binding legal agreement. The first step most buyers take is making an offer to purchase. Your real estate agent may assist you in this process by transmitting your offer to the seller.
The offer to purchase also may contain stipulations to the sale, as well as the buyer's financial offer. For example, the offer to purchase may be contingent upon the seller finding suitable housing within a given period of time; or it may be contingent upon the buyer's ability to secure financing.
Massachusetts law requires that the listing agent present all offers to the seller forthwith, and when the listing is exclusive, offers are presented to the seller through the exclusive listing agent.
It is not uncommon for an offer to purchase to be followed by a counter offer by the seller, and can even be countered again by the buyer. Depending upon how it is written, an offer to purchase can be viewed as a legal contract that binds both the seller and buyer.
There are many additional questions regarding the offer to purchase, such as whether the seller will agree to a home inspection, or whether the buyer can present an anonymous offer. Check with your REALTOR® to make sure all such questions are answered, and that offers to purchase are made within the requirements of the law.
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