It is important to remember when making an offer on a home that the offer to purchase is a contract. Putting emotions aside and protecting yourself is paramount. This article from Money Sense is a comprehensive guide for first-time home buyers and veterans alike. From the appropriate amount to offer, to the deposit, to getting everything in writing, there is more to making an offer than meets the eye.
The first task on your list should be educating yourself on the value of other recently sold properties in the neighborhood. If you have chosen to work with a real estate agent, s/he should be able to assist you with this. Knowing what similar homes in a similar location have sold for will give a good basis on which you can measure what is a fair offer for your desired property. You should also be informed if there are others interested in the property. The possibility of multiple bids can make a difference as to your first offer, and it is important to know your limits. A bidding war can drive the price higher than the mortgage amount you have set for yourself.
After your bid has been accepted, don't delay getting the offer in writing. Again, if you have chosen a real estate agent, s/he will work as an intermediary between you and the seller. If not, standard offer forms are available from real estate lawyers. Homebuyers are advised to not include too many conditions in the contract to avoid putting off the seller. However, the importance of acquiring a home inspection can never be understated. After the conditions have been agreed upon, a deposit will be expected, the amount of which often depends on the purchase price of the home. Remember, the deposit cheque should be made out to a third party and held until closing. At this point you can choose to turn to an experienced mortgage broker to help find the best possible mortgage rates and financing solutions to meet your specific needs.
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