Whoohoo! You’ve found a house that fits your needs. You’ve started imagining where your stuff will go, parties you’ll have, playing in the backyard, etc.etc. Now you need to write up an offer;or more accurately, your Realtor does. BEWARE sleeping on it! If you’ll be heartbroken if someone else makes an offer on “your” house; act today not tomorrow. Depending on market conditions (lots of buyers out there, little inventory, Spring in Minnesota, new house on the market priced REALLY well), you may be in a multiple offer situation where you’re competing with other buyers. More on that later. It takes about an hour to write everything up. Your Realtor will ask what amount you’d like to offer, how much of a down payment you’ll be putting down (if it hasn’t been discussed already), when you want to close (30-45 days is standard), if you’ll be having an inspection (please do) and anything other requests you’d like to make of the sellers. (All these details will be future posts).
Once your offer is all written up, your Realtor will go over the contracts with you and have you sign at alllllllll the required spots. You’ll also need to write a check for 1% of the purchase price as earnest money. Go ahead and ask any and all questions you want before you sign everything. Realtors are used to the contract language so they may breeze through it quicker than you’d like. Don’t be afraid to ask them to slow down. We work for you and want you to understand what you’re getting yourself into for the next 30 years!
Minnesota has about 45 real estate contracts. Don’t worry; you won’t be using all of them. You will already have signed :
-Agency Relationships in Real Estate Transactions (disclosure)-2 pages
-Contract for Exclusive Right to Represent Buyer-4 pages
For your offer, you will most likely be signing:
-Purchase Agreement-7 pages
-Arbitration Disclosure and Residential Real Property Arbitration Agreement-2 pages
-Seller’s Contribution to Buyer’s Costs Addendum-1 page
-A Financing Addendum of some kind. Conventional, FHA or DVA.-2 pages
-Inspection Contingency Addendum-2 pages
-Personal Property Agreement-2 pages
-Seller’s Disclosure-9 pages
Once you’ve got everything signed, your Realtor will make copies for you and then present your offer to the seller, usually that same day. Chances are there will be a counteroffer of some kind, unless you’ve offered exactly what the seller is asking. Your Realtor will have done some research on how much homes are selling for in the area to help you decide what to offer. The seller may have other ideas, so prepare yourself for some back and forth. Your Realtor is trying to get you the best deal and the selller’s Realtor is trying to do the same for them. It’s not personal; its just business.
When you come to terms, you’ll initial any changes made to your offer and your Realtor will deliver your earnest money to the seller’s Realtor. Next step is having your home inspection, which we’ll cover next.
More juicy info next time!