Broker groups, such as our local MLS, working with legal counsel, have developed standardized forms that are appropriate for real estate transactions in their states and areas. Such documents include numerous sale conditions, addenda and their wording should be carefully reviewed to assure that they reflect the terms you want to offer.
Our Seattle Area Real Estate Team brokers can explain the general contracting process in our area as well as our role. While much attention is spent on offering prices, a proposal to buy includes both the price and the contract terms. In some cases, terms can represent thousands of dollars in additional value for buyers -- or additional costs. Terms are extremely important and should be thoroughly discussed and reviewed.
Your Seattle Area Real Estate Team broker will review recently sold comparable properties and review those with you to show you what a likely appraisal value for the property may be. You sometimes hear that the amount of your offer should be X percent below the seller's asking price or Y percent less than you're really willing to pay.
In practice, the offer price has to depend on the basic laws of supply and demand: If many buyers are competing for a home, then sellers will likely get full-price offers or offers above the listed price. If demand for the property is weak, the property is over-priced in comparison to the likely appraisal value or the property has been on the market awhile, then an offer below the sellers asking price may be in order.
Your Seattle Area Real Estate Team broker will prepare the offer and submit it to the seller’s broker. The seller can accept, reject, or counter. Counter-offers are common — any change (price, closing date, terms) is considered a counter-offer. Stay in close contact with your broker during negotiations so you can respond quickly to any changes or requests from the seller.
Until the contract terms are mutually agreed upon by both parties you are still in the offer/counter-offer process and the transaction can fall apart or another buyer can make their own offer to the seller. Therefore it's important for a buyer to remain in close contact with their broker during the negotiation process so that any proposed changes can be quickly reviewed, discussed and either approved or countered.
Once both parties agree and sign the contract, you’ve reached “mutual acceptance.” At this point, you’ll typically submit an earnest money deposit to the escrow company or law firm handling the closing of the transaction.
Earnest money protects the seller and shows your commitment. However, it’s refundable if you exit the contract for legitimate reasons like a bad inspection, low appraisal, title issues, or financing denial.