1. Get Pre-Approved Before You Make an Offer
Before you even think about writing an offer, it’s essential to be pre-approved for a mortgage. A pre-approval letter shows sellers that you’re financially ready and serious about buying. It gives you a clear idea of your budget, which keeps you from falling in love with a home that’s out of your reach.
Most sellers won’t consider an offer without proof of financing. In competitive markets, a pre-approval can give you a leg up on buyers who haven’t taken that step yet.
2. Determine Your Offer Price
Your agent will help you evaluate the home’s fair market value by looking at comparable sales (or “comps”) in the area. Factors like location, condition, days on the market, and current demand will all influence your offer strategy.
You may decide to offer below asking if the home has been sitting for a while or if it needs work. Conversely, if the market is hot, you might need to go above asking to stand out.
3. Decide on Contingencies
Contingencies are conditions that must be met for the sale to go through. Common ones include home inspections, appraisal, and loan approval. These clauses protect you as a buyer and allow you to walk away under certain circumstances without losing your earnest money.
Keep in mind: the fewer contingencies you have, the more attractive your offer becomes to sellers — but it can also mean more risk for you.
4. Include an Earnest Money Deposit
Earnest money is a good-faith deposit you put down with your offer, usually 1-3% of the purchase price. This money is held in escrow and applied toward your closing costs if the deal goes through.
If you back out for a reason not covered in your contingencies, you could lose that money — so it’s important to understand what’s at stake.
5. Write a Personal Letter (Optional)
In some markets, especially competitive ones, writing a personal letter to the seller can help you stand out. While it’s not a guarantee, it can help build an emotional connection and make your offer more memorable.
Just keep it short, sincere, and avoid revealing any information that could violate fair housing laws.
6. Submit the Offer
Your real estate agent will draft the offer using a standardized purchase agreement. You’ll go over the price, terms, contingencies, and timelines before signing.
Once it’s signed, your agent will submit it to the seller’s agent, and the negotiation process begins.
7. Negotiate With the Seller
The seller may accept your offer as-is, reject it, or come back with a counteroffer. Common negotiation points include the purchase price, repair requests, or closing date.
Your agent will advocate on your behalf and help you stay grounded — it’s easy to get emotional, but remember, this is a business transaction.
8. When the Offer is Accepted
Once both parties agree and sign the contract, your offer becomes a binding agreement. Congratulations — you’re now under contract! This kicks off the next phase: inspections, appraisals, and getting final mortgage approval.
From here, your real estate agent and lender will help you navigate the path to closing.
Final Thoughts
The offer-making process can feel overwhelming, especially for first-time buyers. But with the right agent by your side and a solid understanding of the steps, it becomes a manageable — and exciting — part of your home buying journey.
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