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BUYING A HOME -
Making An Offer & Negotiating A Deal (continued)
purchase agreement, you get your full deposit returned. To ensure this happens, make sure the realtor (usually seller’s realtor) holds the deposit. If there is no realtor involved, have an attorney hold the deposit.
b. Make your offer contingent on closing no earlier than a certain date, and closing no later than a certain date.
c. In many states, the seller needs to fill out a disclosure form of any known defects
in the house and property. The disclosure form may also ask if all work on the home
has received any required permits from the city/county building department. If un-
d. Make sure your offer is contingent on the completion of a satisfactory house
inspection to determine if there are any defects in the house. Also include a provision
that closing the purchase is contingent on the seller either fixing any defects,
or reducing the price of the house at a mutually agreed upon amount for the defects.
And make sure you have the right to walk away from the purchase, if the cost to
cure the defects is above a certain amount (usually $3,000-
e. Make sure your offer states what items of personal property are included in the sale (if any) such as appliances. Also state if items like lights and window treatments are included in the sale.
f. Make sure your offer states that you will not be responsible for any real estate commissions owed by the seller.
g. Make sure your offer is only good for a short period of time. This is usually for no more than a few days.
5. If you have offered less than the asking price, you will most likely receive a counter offer, with respect to both price, as well as other provisions of your offer.
a. Negotiate through your realtor, or face-
b. On the other hand, sometimes realtors can get in the way of a deal. The constant back and forth of negotiations through third party realtors can often result in miscommunications, and distrust between the buyer and seller. If this seems to be happening, try writing a personal note to the seller, explaining your desire to purchase the property and your thoughts on how to make a deal work. It may just soften the hard edges that have developed during negotiations, and lead to a deal. But do not be afraid to walk away from a proposed deal if you are not satisfied.
c. When negotiating, try your best to concentrate on large dollar decisions, and resist the urge to “squabble” over issues with small dollar values. Get your best deal up front through a lower initial offer, and by negotiating major reductions from the asking price. You may also be able to negotiate the seller paying part of your closing costs, etc. And when it gets down to that last $1,000 of negotiations, just make the deal if you want the home. In other words, you are most likely to get your best overall deal by concentrating on getting the biggest reduction in asking price that is possible up front, and then not quibbling too much about all the little odds and ends that will need to be decided before a final deal is reached.
6. Once you have a written agreement to purchase the home, you will want to make final arrangements for any financing required (discussed in the next section), as well as other arrangements.
a. The first order of business is to arrange for a qualified home inspector to inspect the home for any deficiencies (including a separate termite inspection). This is very important and should not be taken lightly. If possible, try to find a qualified home inspector through references other than through the realtor. Once again, the realtor does not get paid unless the sale closes. Try to find a very thorough inspector, one that pays particular attention to major problem areas such as roofs, crawl spaces and basements, structural integrity and foundations, HVAC systems, etc. You want the type of inspector that does not get overly worried about the “little” things, but has the knowledge to find the “big” things. You are paying the inspector and have to live with their conclusions, so choose wisely. Insist on being there when the inspection is done (usually a few hours) and insist on receiving a written report from the inspector detailing all findings.
b. The second order of business is to develop a reasonably friendly relationship with the seller, so that any issues that come up prior to closing can be successfully resolved. This can include any number of things, all the way from house defects that are uncovered by the inspector, to visits by the buyer to the house prior to sale to measure for furniture, etc. Try to avoid a “nit picking” adversarial relationship that at a minimum is no fun, and at a maximum can cause the deal to fall through.
c. During the period between signing the purchase contract and actually closing
on the purchase, your realtor should be available to assist with you any arrangements
or questions regarding the pending purchase. This is part of their service that
the real estate commission they will be receiving covers. Do not hesitate to seek
their help and guidance to answer pre-
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