You did it; you found a home that fits your budget, lifestyle and meets all of your criteria. The next step is making an offer.

If you have a real estate agent representing you, they will help you prepare the documents at this stage.

If you do not have a real estate agent, you may want to hire a lawyer, as you will most likely need legal assistance for negotiations and documentation.

When you are ready, you will send an “Offer to Purchase” to the seller. This document will include the offer price, deposit amount, desired extra items to be included (such as appliances, window coverings, etc.), the date you take possession and other conditions (mortgage financing and home inspection).

Once you submit your offer to your realtor/lawyer, they will forward it to the seller’s representative. The seller then decides to accept, reject, or make a counter-offer. A counter-offer is an offer to sell you the home but with some changes made to your offer. These changes often include things such as a higher price or a different closing date. It is quite common for many offers and counter-offers to go back and forth between a seller and a buyer. Don’t let this discourage you; it is all a part of the process of buying a home.

When you’re in the counter offer process, make sure you have a maximum price in mind. Be prepared to walk away if you can’t reach an agreement within your budget. If you absolutely do not want to walk away from the home, be prepared to make an offer that’s above the asking price.

In a competitive real estate market, it is common for many people to compete with bids on the same property. If this is the case, be prepared to lead with your highest possible offer. This means less risk of being outbid. If you want to give yourself the best shot on a home that you really like, lead with a high bid. Be sure to remember that making an offer is a legal proposal to purchase a home. If the seller accepts the offer, it is legally binding.

Get to know the seller

What are the seller’s financial needs?

Tailor your offer to their needs. Find out if they are in a desperate need of money or if they are already well off. This could help you determine if undercutting the asking price is an option to start with or if the seller is likely to jump on the highest bidder.

How long has the home been on the market for?
People are more likely to accept an offer lower than the asking price if the home has been on the market for a longer period of time. Try bidding down.

Have the owners already bought a new house?
The sellers may be anxious to sell the house if they have already moved into another home. It may be easier to bid less within this situation.

What asking price did other homes in the neighborhood start at and sell at?
Do your research! If homes in the area regularly sold for 5% below asking price, try to make a bid 8% to 10% lower than their asking price.

Do you need to sell your current home in order to afford a new one?
If yes, then any house offer you make will be dependent on the sale of your own home. These offers are risky for the sellers since the sale is not definite.

Other questions:

• Why are they selling?
• How old is the house?
• What are existing problems? Or what were problems in the past that are now fixed with the house?
• Is this house around or in a flood plain?
• Has the house had any major renovations?

Once your offer has been accepted, there are still a few final details that have to be taken care of before the home is truly yours. On closing day or the day you take possession, your lender gives your lawyer all the money from your mortgage, and you give them all the money for your down payment. The lawyer or notary will pay all the fees and other costs for you, and send the money to the seller’s lawyer. Lastly, your lawyer or notary will register the house in your name, and give you the deed and keys to your new home.