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Once you find your dream home, it is time to make
an offer. The price of the home is going to be comparable to other
homes in the area that have just recently sold. You and your Realtor®
will discuss the best strategy for determining the price to offer.
Sometimes you can determine the best price to offer by conducting
a Comparative Market Analysis.
A Comparative Market Analysis is a list of recently
sold homes in the neighborhood that are similar to the home that
you are trying to purchase. Reviewing this list will give you a
good idea of how much to offer for the home you would like to purchase.
If the home has been on the market for a long time, the owners may
settle for lower than the listed price. This is true for other cases,
such as relocating or divorce just to get a quicker sale.
Along with your offer, make sure to include your pre-approval letter.
This lets the buyer know you are serious and that they can count
on you to get funding for the home when time comes.
Typically you must also include a deposit with your
offer, which will be applied to your down payment when the deal
goes through. This deposit is held in escrow by the brokerage firm
that listed the property. If your offer is accepted and you buy
the home, the money is applied to the down payment. If your offer
is accepted and you back out of the contract, the seller has the
right to keep your deposit. If your offer is rejected, your money
is returned to you.
The seller may accept, decline, or even counter
your offer, depending on the strength of your offer and the seller’s
own desire to sell. If you find yourself in a counteroffer, you
and your Realtor® can either accept the new offer, or you can
choose to counter their counteroffer until you come to an agreement.
Once both you and the seller agree, a non-partisan party (usually
a title or escrow company) will join the process and complete the
deal.
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