You Found “The House”! Now What?

You’ve done the hard work of setting up your home search, getting pre-approved with a lender, and hitting the streets (or scrolling through listings) with your realtor. You’re in the game—exciting stuff! But when you find the house you want to make an offer on, things start to get real. It’s time to make those money moves!

It’s normal to feel a little nervous at this stage. The idea of committing to a home can be intimidating, but don’t worry! We’re here to guide you through the process step by step so you can confidently submit your offer.

Step 1: Know What Happens After You Submit an Offer

First things first—once your offer is accepted, it doesn’t mean you’re locked in 100%. There are safeguards in place that allow you to back out of the deal if needed. This is why due diligence is so important. You don’t have to worry about being trapped in a home you don’t want—there are options to protect you if things don’t check out.

Before you submit an offer, take some time to review key documents. Your realtor can help you access these documents, which may be listed in the MLS but only available to realtors.

Step 2: Key Documents to Review Before Making an Offer

Here are some essential documents you should review before submitting your offer:

Seller’s Disclosure:

This document is usually required by the seller before listing their home. It provides detailed information about the property, from the age of the roof to the internet provider they use, and even includes any repairs they’ve made over the years. However, it’s important to note that the seller can’t disclose problems they aren’t aware of—this is why a home inspection is critical. We’ll cover inspections in the next module!

Comps (Comparable Homes):

Comps are a list of recently sold homes that are similar to the one you’re considering. This helps you gauge the true value of the property. Is it overpriced? Underpriced? Or priced just right? We have a whole video on analyzing comps in this module to help you out!

Survey:

A property survey shows the exact boundaries of the home, which is especially important for single-family homes. Condos or townhouses typically don’t come with a survey since you don’t own the land, just the building. Surveys can reveal easements on the property (like city utility lines) or whether your neighbor’s fence is encroaching on your land. If the seller doesn’t have a survey, don’t worry—there are protections in the contract to allow you to back out if an updated survey raises concerns.

Other MLS Documents:

Sometimes the seller may upload additional information, such as a previous home inspection report, repair invoices, or even quotes for necessary repairs. While not every listing will have this info, your realtor can help you access what’s available to make sure you’re fully informed.

Step 3: Understanding Multiple Offers and Seller’s Intentions

Before you submit your offer, your realtor will ask the seller’s agent if there are other offers on the table. Knowing whether you’re in a multiple offer situation or if you’re the only one considering the property can affect your strategy. If there’s competition, your offer might need to be stronger (with fewer contingencies, for example).

Your realtor’s insider knowledge of the area and property could also provide helpful insights. They may have seen similar homes or know of any issues that could affect your decision.

Step 4: The Offer: Documents You’ll Need to Submit

Now that you have all the info you need, it’s time to submit your offer. The key documents typically required are:

Sales Contract:

This is the formal document that outlines the terms of your offer. The sales contract is typically created by state attorneys and not by the realtor, but your realtor will help guide you through the contract and explain any questions you have.

Earnest Money Deposit:

This is the first action you’ll take once your offer is accepted. It shows the seller that you are serious about purchasing the home. The earnest money is typically 1-3% of the sales price, and it’s held in escrow until closing. Don’t confuse this with your down payment—it’s a separate deposit. You’ll get it back or apply it to your down payment at closing unless you breach the contract after your option period.

Option Period:

This is the due diligence period, where you can back out of the contract for almost any reason and only lose your option money (typically a few hundred dollars). You’ll usually negotiate the length of the option period, and this is the time you’ll use to get inspections and make sure the home is right for you.

Financing Contingency:

This gives you time to get final approval for your financing. While you may have been pre-approved, your financing could still fall through if your financial situation changes. The financing contingency allows you to back out of the contract and reclaim your earnest money if that happens.

Pre-Approval Letter:

This is your proof that you can afford to purchase the home. Sellers often look at your lender’s reputation—if they’re known for being reliable, it could work in your favor in a competitive situation.

Letter to the Seller:

This isn’t a required document, but sometimes buyers include a letter to the seller explaining why they love the home. If there are multiple offers, a personal touch could help your offer stand out.

Step 5: Submitting Your Offer

Once all your documents are ready, you can officially submit your offer. Depending on the situation, you may need to act quickly—especially if there are multiple offers and a deadline to submit. Don’t worry, though! You’ll have time to review everything and conduct your due diligence after you go under contract.

Conclusion

Now you’re equipped with the knowledge you need to make a confident offer! You’ve reviewed key documents, understood how to submit your offer, and learned what protections are in place. The next step? Analyzing comps and continuing your due diligence. Stay tuned for the next module, where we’ll dive deeper into that!

Happy home buying!