Step 5 to Buying a Home: I Want to Make An Offer On A Home I Love
Fabulous! You've found the perfect home and want to put in an offer. Before we can put an offer in on a home, we need you to answer the below questions so we have all of the information we need to write up an offer.
We need to know
Full legal name: Please email us the full legal name of anyone who will be on the contract as well as their email address. The legal name has to match what is on their driver's license as they'll need to show a driver's license or passport at closing and this name needs to match what is on the contract.
Initial offer price: What initial price do you want to offer for the home? I will email you comps to review and give you my opinion as to what the home is worth and what price you should offer, but ultimately the offer price is entirely up to you.
Your walk away price: Don’t expect to pay your initial offer price unless you are submitting your highest and best offer off the bat as it’s extremely rare for a seller to accept your initial offer without some negotiating back and forth. That’s why it’s called an initial offer. In addition to deciding what offer you want to put in to start, you need to decide now how much you’re willing to pay for this property and what your walk away price is before thing get heated and emotional. We will not share this walk away price with the sellers, but it's important for us to know this price up front so we can best guide you during the negotiations.
Closing date: Typically in Iowa, closings takes place 30 - 60 days from contract acceptance (45 days is the average), but often we can close as quick as 21 days for purchases with loans (check with your lender to make sure they can close that quickly) or as quick as 14 days for cash closings. Closings can only take place Mon - Fri; they cannot take place on weekends or bank holidays when the banks are closed.
Sometimes you can ask for a longer closing date (60 - 90 days) depending on the seller’s needs, but don't expect it to be granted. Therefore, if you want to move around July 1, plan on putting in offers May 10 - 15. While some local lenders we use can do closings faster (usually 21 days is the fastest a closing can be done with a mortgage), most lenders can't close that fast and need 30 - 45 days. If you want to close faster than 30 days please let me know as we'll need to direct you to particular lenders in town who are capable of closing quickly or ask if your lender can close that fast.
If you’re not getting a loan and are paying 100% cash you can close as quickly as 14 days.
Before putting in an offer, please let me know what exact date you want to close on the home (remember it has to be a Mon - Fri). If you have a specific time that you want please let us know right away. Closings can take place anytime from 9am - 4pm and usually take 30 minutes. If you cannot attend closing, we need to know that 2-3 weeks in advance so we can notify the lender.
Earnest money: How much earnest money are you comfortable putting down on this property? Typically, contracts in Des moines and surrounding areas ask for 1% of the purchase price as earnest money.
Down payment: For the contract, we need to know how much you’re going to put down for your down payment. Examples would be 3.5%, 5%, 10%, 20%, 30%, etc.
Closing cost credits: Do you want to ask the sellers to pay any of your closing costs? Generally the sellers pay their closing costs and the buyers pay their own closings costs, however, we can ask the sellers to pay some of your loan closing costs on top of theirs, if needed.
Home warranty: Do you want to ask the seller to provide a home warranty on the property? If the property doesn't have multiple offers, we always recommend asking the seller to provide you with a one year home warranty. Depending on the type of property you're buying, this usually costs the sellers between $500 - $800. Here's more information on what a home warranty is: First American Home warranty
Contingencies: Any other contingencies we need to be aware of? Do you need to sell your current home before you can buy this home?
Want to review the contract in advance? We will go over these in detail at the buyer consultation.
Once we've talked through the above, We will then write the contract and have you sign it via a program called DocuSign.Click here to watch a video on signing documents electronically via DocuSign. We’ll then submit it to the seller’s agent. While negotiations sometimes go quickly, be prepared that it could take 2-4 days to negotiate the purchase price and terms of the contract. Every seller is different and some people can make decisions quickly whereas others need time to think things through. Patience is the name of the game once an offer has been submitted as we don't want to look too eager as it weakens our negotiating position!
