The offer is not just a sale price from the buyer – there are many items to consider.
In addition to the price, you'll have to consider things like deposits, financing type, timeframe, and contingencies.
Fortunately, YELLOW has made the offer easy to understand and easy to accept, reject, or counter.
YELLOW MAKES THE OFFER EASY
The offer can be complicated. The legal contract of the offer is a dozen pages long and filled with legal jargon.
YELLOW provides a summary of the offer and a guide to help explain the form in full.
Here's a summary the seller will see on every offer:
Multiple offers comparison
YELLOW provides a color-coded summary of all offers for easy comparison.
The guide to the purchase contract can be found below:
Sellers can also check out our guide to the purchase contract from the sellers perspective. This looks at things like deadlines and conditions strictly for the seller.
YELLOW is here to help and can walk through any form with you.
- PARTS OF THE OFFER -
We'll discuss the main sections of the contract below.
This is the most important part of the offer. Did the price come in at or near your goal? See how much you will walk away with using a calculator.
These are the things that must be completed or satisfied before the deal can be closed. They are for the benefit of the buyer - if they aren't completed or if they reveal a problem, the buyer can back out of the deal and keep their earnest money.
Here are the most common contingencies:
You have already completed an inspection that YELLOW has provided for the buyer. However, the buyer can wish to do their own, if they choose.
The buyer can walk away from the deal if an inspection reveals a problem that they don't feel comfortable with. This could be any inspection - from the general inspection to the WDO or lead paint or septic or any other inspections that may have been competed.
An appraisal will be required for buyers using a mortgage.
If the appraisal comes in below the amount you agreed on, it will give a reason for the buyer to try to renegotiate the sale price. If a deal isn't reached, they can cancel the contract. This is usually only if the appraisal is significantly below the sale price - slightly below is often acceptable.
Even though the buyer has a preapproval for a mortgage, they may not be ultimatelly be approved for a mortgage. Without financing, the deal falls apart and the buyer can exit without penalty. This is the most common reason for deals falling through.
If there turns out to be a problem with the title, the buyer can cancel the deal.
Keep in mind that these, too, are all a part of a negotiation. If you don't like the contingencies, you can simply reject the offer or make a counter offer.
The offer will include the way the homebuyer will finance the home purchase. This is important because it can provide clues as to how long it will take to close.
This is the date the buyer plans on closing. It might sound great to close quickly, but remember you must have a new place to live and time to pack. Ideally, this date should suit both the buyer and seller.
The average closing time is around 45 days and most close between 30-60 days (what is the buyer doing during the closing process? Find out HERE). Have realistic expectations for closing times.
Earnest money is also commonly referred to as the escrow deposit, binder deposit, or good faith deposit.
This deposit is the amount the buyer will pay into an escrow account to show that they are serious about their offer. It's most common to see a deposit of 1% - 2% of the purchase price, and usually a round number in that range, like $2,000 or $4,000. Homes on the lower end are usually closer to 1%.
If the buyer fails to follow through on certain parts of the contract before closing, the seller will likely be entitled to that money.
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