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    Step 6: You’ve Found a Home Time to Write an Offer

    Step 6: You’ve Found a Home Time to Write an Offer

    Eureka! We’ve found the one that checks the majority of your boxes so time to write an offer.  Below are the steps to creating an offer so that you can begin the negotiation process. 

    • We will need to know the EXACT spelling of your name and how you would like it recorded on the deed.  This is important because when it’s time to sign the      documents this is EXACTLY how you will sign every single paper. 
    • We will go over the tax records with you and fill out the contract as we go along.   We will go over every document so that you are comfortable and understand what you are signing.  You will take a copy of the documents with you and we will input the details in the signature software we use called Dotloop.  You will review the documents to make sure they match before you sign the digital documents.
    • Once we have reviewed the comparable sold properties we will compare the home you are offering on to the other properties that have sold in the last 6 months.  We must use homes in the subject area if there are homes that have sold in the past 6 months.  An appraiser will use the same data that we use to assess it’s value so it’s very important to use properties in the subject area if they are available.  
    • The initial offer (depending on the market) will typically not be your final offer.  The only exception will be if you are up against a multiple offer situation and they are requesting your highest and best offer.   The goal is to save as much as you can and still be able to put down the required down payment as well as being able to manage your monthly payment.  It needs to be reasonable though, if an offer is ridiculously low you may offend the seller and they could refuse to do business with you (which is their right).  A good rule of thumb is to put yourself in their shoes.  If you had invested time and money and are offering a great home you would expect to be fairly compensated for it. 
    • You will need to determine your walk away price, the most you are willing to pay for said property.  This is important to determine at the beginning of negotiations.  Negotiations can be an emotional roller coaster for buyers and sellers.  Knowing your walk away price will often keep the stress levels manageable and it helps you maintain reasonable expectations for yourself and this major financial investment.
    • Earnest money is required to accompany Oklahoma Real Estate contracts.  Earnest money is a financial investment on the behalf of the buyer which says “yes, I am earnestly willing to buy this home” and is considered part of the down payment if you are using a loan to purchase.  Earnest money is always returned to the buyer at closing and applied toward the loan on the home if a loan is used to purchase.  If it’s a cash purchase the buyer will receive the earnest cash back at closing unless they opt to use it towards the purchase price. The only time that it  is not returned to the buyer is if the buyer is in breach of the contract.  Our job as your realtor is to make sure that will not happen.  We will abide by all timelines so that if for some reason you decide the house isn’t a good match for you that your earnest money is returned to you when the contract is cancelled.  Earnest is typically 1% of the purchase price or $1,000 for every $100,000 of the contract price, usually increasing in increments of $500.00. Earnest money is required to be deposited by the 2nd business day after all parties have signed the contract, which means you must already have that money available separate from your down payment amount.
    • The closing date is the next decision you will need to make.  It takes roughly 30-45      days to close a transaction involving a loan and roughly 2-3 weeks if it’s a cash purchase.  We highly recommend if possible to close on a day earlier in the week if it all possible if you are using a loan product.  Most people want to close on Friday so that they have the weekend to move.  Unfortunately, more often than not, lender closings are often delayed for various reasons. Having a few days extra prior to Friday can save you the roll-over to the next week if for some reason the loan needs more time.
    • When you meet with your lender for the pre-approval they will discuss the minimum amount that you will need for a down payment depending on the type of loan you are using.  We are required to inform the seller what type of loan and how much down payment the buyer will be placing on a separate loan document.  Just know that everything that you discuss with your real estate agent is completely confidential.  We are bound to that confidentiality by our state and sign buyer’s agent forms stating as such.
    • Closing Costs can be a large portion of your total fees and you can ask sellers to pay for some or all of these fees.  For example on an FHA loan of $150,000.00, your closing fees can be upwards of $6,500.00 that is due, by you the buyer, in addition to the down payment and earnest that are also required for the purchase.  Thankfully, sellers are allowed to pay some or all of your closing costs depending on the type of loan product you choose.  It is another point of negotiation but if it is something you want or need we will list it on the loan document.
    • Home warranties are another product that you can ask for.  This is basically an insurance policy for the main items in the home, electrical, plumbing, mechanical. They typically cover all of the main items in the house with the exception of the roof.   They do have a deductible per item usually around $100.  You are only charged the deductible once per item regardless of how many times they have to address it or potentially replace it.  Most warranty companies also provide a re-key service as well which is nice when you are buying a pre-owned home.
    • Lastly, do you need to sell your home before you can close on a new home? This is considered a contingency.   If you currently have an FHA loan on your home you will have to sell it before you can purchase another with the same type of loan.  This rule also applies to Rural Development loans, 184 Native American loans, and VA loans depending on your personal VA benefit.  The government does not allow for multiple loans on government loan products. You can, however, purchase a home with a      conventional loan product (if you approve for it) if you currently have any of the above government loans.

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