How to write an offer that will be accepted on a home.

You have found the perfect home and now it's time to write an offer.  How can you make sure to get it accepted? 

The best place to start is to craft your offer around the needs of the seller. If you're in a seller's market, expect to be more agressive on your terms.  If it's a buyers market, the seller may be more lenient.  Knowing your budget, market trends, using the right agent, and having a strategy about which homes to offer on will help to make your offer get accepted.

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Things like price, timelines, splitting of fees, what's included, what's not included can make or break your offer.  Let's break down each piece of the offer so you can put your best foot forward.

Offer Price
Price is the most important factor in a offer. A seller's decision to accept an offer is greatly going to depend on what they will net on the sale of their home.  When determining what price to offer, it's important to know what other homes in the area are selling for.  This is where knowing the market trends really comes in handy.  If on average, houses are going 4% over the list price, that's a good place to start. 

Close of Escrow
When you make an offer, you will set timelines for how long the process will take.  The close of escrow is the date is when the transaction will be finished and you will get possesion of the property. On average transactions take around 30 days to close. Typically, the shorter you can make this date the stronger your offer will be. A seller may need a longer close of escrow so be sure to know their situation. If you are financing, yor lender will determine how quickly you can close. 

Contingencies
In California, you have three contingencies in your offer, one for inspections, one for appraisal, and one for securing your loan.  These contingencies have timelines associated with them.  17 days for inspections and appraisal, and 21 for your loan.  The shorter these timelines are, the stronger your offer will be.  It essentially says, "Hey seller, in the event this doesn't work out, I won't waste much of your time."  

Deposit
An earnest money deposit (EMD) is required to be put into escrow within three days of acceptance.  At the end of the transaction, it is applied towards your down payment or closing costs.  As a rule of thumb, we use 1% as an earnest money deposit.  Increasing your earnest money deposit will help to make your offer stand out in a crowd. 

Financing Type
Some financing types are more lenient with requirements of a property.  These requirements are typically focused on health and saftey.  Conventional loans tend to be more lenient than FHA or VA offers. Depending on the property condition, your loan type may have an impact on which offer is chosen.  

Fee Splits
There are a few fees listed on a California Residential Purchase Agreement.  These include, escrow, title insurance, natural hazard zone disclosures, city and county transfer tax fees and home warranties. Any of these can be paid for by the buyer, the seller, or split between the two.  The more fees you pay for as a buyer, the stronger your offer will be. 

What's Included in the Sale
Anything that is not secured to the property is considered to be personal property and does not come with the house. It's a common thing to request that appliances stay with the home.  There are checkboxes for the refridgerator, stove, and the washer and dryer.  You can also write in items you would like to be included in the sale such as sheds, furniture, etc.  If you ask for too much, it may make your offer not as appealing for the seller.

Rent Backs
It can be difficult for the seller to get an offer accepted contingent on their property selling in seller's markets.  It is common for the seller to need a rent back after the close of escrow so they can stay in their property while closing on their new home.  If you're financing a property as your primary residence, you will need to take possession within 60 days.  Most rent backs are for a 29 day period after the close of escrow.  Anything longer than 29 days will require a lease to be put in place. A seller can pay for a rent back, but you can also do it at no charge which may help your offer to stand out.

Don't Forget
To be sure that your offer is taken seriously, be sure to include a pre-approval letter from your lender.  You should also include proof of funds with your offer to show that you are able to fufill the contract.