Responding to An Offer To Purchase Your Home

When you've got a serious buyer, you'll receive a written offer to purchase your home, sometimes called an "earnest money" or "residential purchase agreement."

You won't have very long to decide whether or not to take the offer or propose a counteroffer -usually 48 hours or less- so it's important to be informed ahead of time.

You're not required to accept any offer.

Contract Details

A home purchase offer will likely include:

• Purchase price the buyer is offering
• Amount of down payment (sometimes called "earnest money" or "deposit")
• How long the offer will be open.
• The date the sale will be finalized ("closed") and the date you'll move out
• Who will hold the deposit money (usually an escrow agent) and who will be the closing agent and/or escrow agent for the closing
• Items to be included in the sale, such as carpeting, lighting fixtures, appliances and so forth
• Items not included in the sale
• A legal description of the property
• Assurance that you'll provide clear title to the home, through an abstract of title, certificate of titled or a title insurance policy
• A provision detailing who's responsible for paying utility bills, property taxes, insurance and other house-related expenses through the closing date (usually the seller)
• Language that requires the return of the buyer's deposit if the sale isn't completed due to not obtaining financing or some other contingency of sale
• An inspection clause that allows the buyer to have the home inspected by a professional inspector, usually within a few days of the date of the contract.
• Language that details when the buyer can do a walk-through inspection before the closing date to make sure everything is in order according to the guarantees made in the contract
• A mortgage contingency provision that allows the buyer to be released from his/her offer if unable to obtain a loan in a specific amount at a specific interest rate within a specific amount of time (usually between 30 and 60 days),
• A provision that requires you to pay a certain amount of money for every day beyond the closing date that you're still in the house (usually called a "liquidated damages" clause).
• A clause that makes the offer contingent on the buyers' sale of their current house.

Counteroffers

A seller will usually respond to a buyer's offer with a counteroffer that accepts some of the terms but proposes changes to others.

Common counteroffer proposals include:

• A higher purchase price
• A higher deposit
• Giving the buyer less time to remove contingencies such as inspections and selling their current home, or removing these contingencies altogether
• Excluding certain items from the sale, such as your antique heirloom chandelier that you'd like to take with you when you move
• Providing you more time to vacate the house after the sale is closed
• A clause making it a contingency that your attorney approve the contract (if you haven't had the time to have your attorney review the agreement)
• A "liquidated damages clause" that details how much money the buyer will owe you if he/she backs out of the deal for reasons other than the contingencies listed in the contract. In some states, laws limit liquidated damages to the amount of the earnest money deposit.

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