Putting in an offer letter is a huge step in the home buying process. This letter means you’re deeply interested in the property and would like to move forward with purchasing the home.
Making an informed decision before putting in an offer letter is crucial to making a good purchase decision, so there are a few steps to consider before turning in an offer letter.
Analyze the housing market before Home offer letter
When collaborating with a trusted real estate agent, it’s essential to examine the current housing market in your area. The market fluctuates frequently, so knowing if you’re in a buyer’s market or seller’s market is key to how you can approach the purchasing process.
In a seller’s market, the demand for housing exceeds the supply being offered. In a buyer’s market, there’s an excess amount of home’s for sale and fewer homebuyers. Knowing which of the markets you’re in can help you and your real estate agent craft a solid offer on the home you’re interested in.
Get approved for financing
Before turning in an offer letter, it’s in your best interest to acquire a preapproval letter for home financing. This letter can give you a better idea of the budget you’ll have to work with when purchasing a home. It can also signal to the home seller your seriousness and credibility to purchase their property.
Most preapproval applications can be quickly filled out online. They may ask for personal details such as your name, number, credit information and more to see if you qualify. After this information is sent, on average, you can expect an answer with a loan offer within about half a week.
Find the sweet spot when offering earnest money
Earnest money, also known as a good faith deposit, is an amount offered to the home seller to prove your seriousness to purchase the property and to offer them protection if things don’t go as planned. Some sellers may have a set amount of earnest money they request, but offering a bit more can really make your offer letter stand above the rest.
Submitting an offer letter may feel nerve racking, so take time to consider all options before turning one in. Collaborating with your real estate agent, you can turn in a great offer letter, sealing the deal.