What to Do before Making a Purchase Offer

Posted by Tamara Berryman on Thursday, February 5th, 2015 at 12:05pm.

So you've been house hunting for weeks and now, you've begun to narrow your short list to just a few properties. You probably have a favorite in mind, but still have reservations about committing with a purchase offer. Though you do prefer one over the others, you don't want to purchase years of buyer's remorse. That's completely understandable and you're right to take caution in taking a bit more time to think your choices over.

Some buyers do make the mistake of getting caught-up in the future to the point they simply don't see or aren't willing to slow down. It could be a great price, the ideal layout, wonderful creature comforts, or a combination of things. Regardless, it's best to really get to know the home and take a candid look at its shortcomings. By the same token, it's also wise to approach this as you would another type of purchase. When you buy a new television, you're quite likely to check out the reviews, go over the specs, and compare various models--a home should be no different.

What to Do before You Begin Your House Hunt

If you've already reached the point where you're ready to buy a home, then you have your down payment saved, your earnest money deposit and closing costs set aside, money for your move and household items ready-to-go, have a firm understanding of your credit score, and are prepared to move out of your current residence. Should this not be the case, in any aspect, you're not yet ready to look for a home to purchase.

Before you make an offer on a house, it pays to ask a handful of questions. While the answers might scare you off or make you rethink your bid, they could make you feel more confident that you're making the right move on the right house. --Bankrate.com

Well before you begin your house hunting, all of those things must be done. You should have your financing in-place and money for the various expenses listed, including a home inspection and pest inspection. Speaking of inspections, you ought to have referrals from family members, friends, and coworkers so you can tentatively schedule your inspections. This will give you ample time so you aren't rushed later on.

In addition to these, you should be paying down debt well before you even apply for a mortgage. At least sixty days in advance of applying for a home loan, pay off as much as possible without leaving yourself too thin on cash. Also, you should meet and work with a real estate professional to act as your buyer's agent. This will be key to finding properties that best suit your needs.

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Questions to Ask before Making a Purchase Offer on a Home

When you've whittled down your list of possibilities to just a few properties and then down to one, you might jump to make a purchase offer. Before you do send the seller an offer, which will constitute a legal agreement if accepted, get to really know the home. Here are the most important questions to ask before making a purchase offer on a home:

  • What's planned for the neighborhood? If you already live in the neighborhood, you might know that the city or county is planning to widen the nearby road to ease traffic congestion. Or the nearby park is slated to undergo significant changes. Search the neighborhood online for news about it so you aren't surprised. You can also ask your buyer's agent about any future plans.
  • What are the local amenities? You can conduct the same type of search for local amenities. Perhaps that quaint but busy shopping strip is about to get a complete makeover. Or the golf course is going to shut down its driving range and use the space for something else.
  • What about the association's plans? This is a huge deal if you're buying a property that's in a homeowner's association. Inquire about any future updates, including improvements, the status and health of the association reserves, any legal problems, and so on. You should look into the association and ask residents about their thoughts and feelings.
  • What about the home itself? If you can speak directly with the sellers, take the opportunity to learn as much as you can about the home itself. Ask about any improvements that have been made, about the neighborhood, traffic, what activities are nearby. The sellers will be a very valuable resource and a wealth of information.
In addition to these questions, consult your buyer's agent about your price offer strategy. You might find the asking price is a bit high or that it's priced to sell. Also, be sure to devise a plan for what you'll do when the seller responds either with an acceptance or a counteroffer.

Tamara Berryman
Google

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