Finding the home of your dreams is an exciting part of the homebuying process, but this particular phase is not complete until you make an offer that the seller accepts. Once you find a property worth pursuing, your next step is to submit a competitive, thought-out offer that satisfies both the seller and you.
Preparing to Make the Offer on a House
When preparing to make an offer on a house, first consider the figure you’re willing to give. Don’t put down the maximum amount of your preapproval—that number is how much your lender is willing to provide in a loan. Preapproval does not factor in any other financial commitments you may have like:
- Car payments
- Utility payments
- Credit card bills
- Monthly savings
Be sure to crunch the numbers to find a mortgage price that you can reasonably cover each month. Your calculations should be substantially lower than your maximum preapproved figure, and they should help you zero in on a specific price range for offers.
Your offer should not be too low from the listing price. You should aim to provide a number that leaves room for negotiations. You’ll lose the opportunity to negotiate within your budget if your offer is too close to the asking price. However, an offer that’s too low could kick you out of the running for the home.
As you prepare, ask your agent to help you construct an offer that’s both competitive and affordable.
Once you make an offer, there are a few possibilities that can occur:
An Accepted Offer
Ideally, you want the seller to accept your offer. This means the house is tentatively yours if everything progresses well while under contract. If the seller accepts your offer, you both will sign a tentatively binding agreement, moving you into the next phase of the buying process.
A Countered Offer
The seller can counter your offer for a couple of reasons:
They think your number is too low.
A seller can counter with the listing price or a figure close to it if they think your initial offer was too far below what they asked for.
They want you to get competitive.
Whether a house is popular or not, a seller could use a counteroffer to encourage you to become competitive against other possible buyers. The seller’s goal is for you to think you should stand out from any competition with a higher bid.
A Rejected Offer
In some cases, your offer can be rejected entirely. The seller may think that your offer is too low to be taken seriously. They could also use the rejection as a strategy to encourage you to provide a new (and much higher) offer. If your offer is rejected, really consider if the house is worth a second bid. If it’s not, continue your search. If it is, come up with another figure within your budget and resubmit.
Putting an offer on a home can feel overwhelming, but you’ll have peace of mind with a team like Walker, Hulbert, Gray, & Moore. We’ll analyze your offer as well as any seller disclosures and contingencies to avoid possible discrepancies in the future.
Ready to make an offer on a home? Before you do, talk with our experts! 478-987-1415
Stay tuned for the rest of our series on the steps to buying a home:
- Steps to Buying a Home, Part 1: From Preapproval to Offers
- Steps to Buying a Home, Part 2: Three Offer Responses
- Steps to Buying a Home, Part 3: What to Do Under Contract
- Steps to Buying a Home, Part 4: The Under Contract Phase, Continued
- What to Expect on Home Closing Day