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How Do You Make an Offer On a House?

Deciding to buy a house is huge—it’s one of the most significant investments you’ll ever make, if not the biggest. You search for the perfect home, and when you think you’ve found it, the next step is to make an offer.

What exactly does making an offer entail?

Before You Make An Offer

First, you should have a few things in place before you make an offer. One is a mortgage preapproval from a minimum of one lender. If you get preapproved, it helps you know how much house you can actually afford. The preapproval letter also shows sellers you’re serious.

Then, you need to understand the local market to make sure your offer is competitive. Your real estate agent will be able to help you with this.

The third thing to have in place before you make an offer is making sure that you have the down payment in the bank and ready.

Once the three things above are ready to go, then you’ll start to determine your price, contingencies, and your timeline. If you’re buying in a competitive market, you should ask your agent how you can make your offer as competitive as possible.

Common contingencies that might be included in your written offer include:

• Final loan approval—this means that your purchase of the home is contingent on your getting the mortgage within a certain amount of time.
• Appraisal—A lender is typically going to require an appraisal to verify the value of a home. A lender doesn’t want to take on unnecessary risk by lending you more than what the home is worth.
• Inspection— You might include a contingency requiring that the home undergo an inspection, and you could outline how issues are dealt with if they’re discovered.
• Home sale—In this situation, if you have a home already and your purchase depends on you selling it first, then you might add this as a contingency.

To leave room to negotiate, it can be a good idea to make an initial offer below the maximum price you can pay. Contingencies can include things like appraisals and inspections.

Submitting An Offer

Once you’ve worked out the specifics of what you’re going to offer, your real estate agent will draft a purchase and sale agreement. You’ll look it over and sign it before it’s submitted.

If you’re making an offer that’s way off from the home’s asking price, your real estate agent should include a letter highlighting why, such as the findings of a competitive market analysis. The agent for the seller is legally required to provide any offer to the seller.

An offer letter will include not only the price you’re offering but the amount of earnest money and down payment you’ll pay if you’re preapproved for a mortgage and a breakdown of who’s responsible for paying what closing costs.

The offer letter may also have information about the sale of your current home, if relevant, and the expiration date of your offer.

In a competitive market, you might also include a handwritten note to the buyer letting them know why you hope to buy their house.


Once a seller gets your offer, they might accept it as-is, decline it or counter it, in which case you begin negotiating.

Along with negotiating on price, there are other ways that you can leave some room for negotiation.  For example, going easy on contingencies is going to make your offer more competitive. If you can pay cash, that’s always going to get the attention of a buyer.

Your agents should handle the negotiations.

Once negotiations reach a conclusion, the deal is done when you and the seller sign the purchase offer agreement. From there, you move onto the complete mortgage application process.


Written by Ashley Sutphin for Copyright © 2023 Realty Times All Rights Reserved.