How to finalize an offer when buying a house.

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Three requirements are required to buy a house:

• The purchase agreement must always be in writing
• It must be an offer and an acceptance
• There must be “consideration,” which is usually an exchange of money for property

To finalize an offer, then, you’ll need to submit an offer or counteroffer which the seller then accepts. You may also accept a counteroffer. This will get the ball rolling.

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How to finalize an offer when buying a house.

When you’re ready to buy a home, you need to make an offer on the property. After your offer is accepted, you will need to sign a contract (purchase agreement). This will complete your offer.

Similar: Understanding a Real Estate Purchase Contract

But it’s important to understand how offers and contracts work. It is important to understand the steps required to complete the purchase. You may regret making the purchase if you don’t do the proper research.

Take the time to read all terms and conditions. Talk to your attorney and real estate agent. Know what you’re getting into before signing anything.

Comparison of offers and purchase agreements

An offer is a written proposal to purchase a property. It is drafted with the help of the buyer’s agent and given to the seller’s agent.  It is a request for a purchase agreement. The seller must accept the offer.

An oral offer is possible when you purchase a home. However, it can be difficult to enforce and prove. You can also make an oral offer using a purchase agreement, but it will not be binding until the seller and buyer sign it.

A letter of intention is also an option. The terms you intend to purchase the property are set out in a letter of intent. It also states that, if you and the seller agree to the terms, you’ll write up the terms in a purchase agreement.

Similar: Avoid these pitfalls when you buy real estate.

A purchase agreement, also known as a real estate contract, is also known as a sale contract. It’s an arrangement between buyer and seller to transact real estate.

The buyer agrees that he will pay the agreed-upon price for the property. The seller agrees for the deed be conveyed to the property. A signed purchase contract outlines the terms of sale between the parties. These terms may include:

• Prices
• Dates for closing sales
• Deadline at which the offer is to expire
• Earnest money deposit amount
• Information about who pays for inspections and survey, title insurance, etc.
• Information about how to adjust utilities, property taxes, and other fees

More home purchases are a must

Home purchases require more than verbal offers and acceptance. Legally binding, the purchase agreement has to be in writing.

“If something goes wrong, you’ll need to sue to enforce your rights under a purchase agreement. Without an agreement in writing, most courts will not enforce it,” says James DodgePurdue University Global, Professor of Law.

Also, there must be “consideration” when you buy a home. This is often an exchange of property for cash.

Related: 10 reasons your home purchase didn’t go through

“Consideration refers to the thing of value that each party brings to the transaction. For the seller, this means real property,” says Dodge. “For the buyer, this means the purchase price being paid. It could be in the form of cash, the proceeds of a loan, or even other real property.”

What’s involved in finalizing a purchase agreement

Per attorney Elizabeth A. WhitmanTo finalize a contract, you will need to follow the steps below:

1. The seller accepts the buyer’s offer
2. The seller can either accept the offer or make a counteroffer. “Frequently, the counteroffer will involve an increased purchase price. But it also might change other terms of the contract,” she says
3. The buyer accepts the counteroffer. Oder the buyer submits a counteroffer
4. One party accepts the other’s offer or counteroffer
5. Both the buyers and sellers sign the agreement.

“Finalizing” means that the seller and buyer have reached a “meeting of the minds.” “This happens when the buyer and seller agree on each and every term of the agreement,” says Suzanne HollanderFlorida International University, instructor and real estate lawyer

When a contract isn’t final after all

One or both of the parties can cancel a purchase agreement after it is signed. Most purchase agreements include information about when and how a party may cancel. You may also find out if there are penalties. For example, if the buyer has to forfeit an earnest cash deposit.

Related: How can you get out of a contract in real estate?

“If a buyer backs out, the seller may be able to keep the buyer’s deposit. The seller may also be able to sue the buyer for monetary damages,” says Hollander.

“If the seller backs out, the buyer may be able to sue. The buyer may try to force the seller into selling the property. Or, the buyer may file a claim on the property. This will prevent the seller from selling the home to someone else until the dispute is resolved.”

What you can achieve

These tips will ensure you get the best results.

• You must ensure that you have sufficient funds to purchase your home
• Your own real estate agent. “Don’t rely on a seller’s agent to look out for your best interest,” adds Whitman. “Also, find out who is paying your agent. If the seller is paying your agent, it ideally should be in the purchase agreement”

Related: How do you fire your real-estate agent?

• Hire a real estate attorney. This person can review all the documents and make sure you are legally protected “Your agent is probably not legally permitted to prepare a highly customized purchase agreement,” says Whitman
• Make sure to consider any contingencies you wish to add in the contract. This could include making the purchase conditional on a satisfactory home inspection
• Before you sign the purchase agreement, read it carefully. “Make sure you understand the time periods involved,” Hollander says. “Understand your due diligence period and how to get your deposit back, too”

Unless you are a very seasoned buyer working in a highly-competitive market, you’ll want to include some contingencies, which will allow you to exit the transaction penalty-free. Those include an appraisal contingency, which means you can’t be forced to complete the deal if the property appraises for less than the purchase price.

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