As we work our way through the home buying process, we’ve come to an exciting time! After choosing me to help you with your home search, getting your pre-approval from a lender, talking about your wants and needs for your new home, and finally hitting the street to view homes…..gasp! We’ve found it! The home of your dreams! Let’s talk about Making Your Offer!
Making Your Offer
When buying real estate in the state of Georgia, most real estate agents use standard contracts that have been created by the Georgia Association of REALTORS. (GAR) The GAR(*) contract has been developed, and refined over the years to cover most anything and everything that has come up in real estate transactions in the past. While the entire contract and its contents are important, I’m going to focus on a few key points here.
(*) A second contract form has also been developed and it is perfectly acceptable. It is called REForms. Some Listing Agents want to see, or have an offer for their Seller on a GAR Purchase and Sale Agreement. While that can be changed during the negotiation process, an agent must present ALL offers to the Seller. Even if they are on a paper napkin!
- Purchase and Sale — Here is where you will identify the property and provide the legal description.
- Purchase Price of Property to be Paid by Buyer — Just want it says! The amount we are offering. Amount and Deposit of Earnest Money — Here you will indicate the amount of earnest money (like a down payment, but show your seriousness in making the purchase) and if the earnest money has actually been received by your agent/broker, or WHEN it will be received and deposited.
- Closing Costs –These are all the settlement costs associated with closing on the property. If you are paying cash, this will be a much lower expense. But most likely, you will be obtaining a mortgage and as such there are expenses involved with same. Here you are asking the Seller to pay all, or a portion of those closing costs.
- Closing Date and Transfer of Possession — This is important for a number of reasons and can be a major negotiation! You might want to purchase the home/condo and move in the next 30 days (provided your loan can be approved that fast) But the Seller may not be able to move that fast. Or perhaps you want a longer closing date to help with your moving, and the Seller is concerned that their home will be off the market all this time, and should the sale not be completed, they have lost valuable marketing time. As we work on making an offer, we will try to learn more about the Seller’s intentions about a move out and possession date. But we may not know this till you make an offer. However, if you, as a Buyer, know you have a limited amount of time to be move into your new home, have your agent inquiry before you make an offer about the time frame. We also refer to this day as our Celebration Day….when you get your KEYS!
- Holder of Earnest Money — The brokerage or place where the Earnest Money is being held MUST be identified on the contract.
- Closing Attorney/Law Firm — All closings in Georgia are done by an attorney. Here is where we indicate who that will be.
- Earnest Money –– This is your “good faith deposit” that you make when you present your offer. The amount is also negotiable, and can also be tied to various performance clauses within the contract.
- Inspection and Due Diligence — Perhaps one of the most important paragraphs in the contract!!! In Georgia, during your Due Diligence period, you may terminate your contract for any reason whatsoever. Maybe you got cold feet, or just learned of a pending job transfer, or job loss….you can get out of your contract and receive your earnest money back. But also during this time, you will be conducting your inspections and doing all the looking you feel necessary during this time period. This Due Diligence period is a separate item from any other contingencies you may have such as financing.
- Exhibits and Addenda — (Actually on page 6 of the 2017 Purchase and Sale Agreement) Here is where various exhibits are included as part of your contract. They include, but are not limited to Appraisal Contingency and Sale or Lease of Buyer’s Property Contingency as well as other items such as Lead Based Paint and the Community Association Disclosure (HOA).
- Special Stipulations — Here you cover any other specific items that have not been covered in the contract. Again, a couple examples would be the Seller paying for a Home Warranty for the Buyer, condition of systems in the home or condo, etc.
Just be reading this, you might think “Wow” or be overwhelmed! Never fear…I’m here to walk you through all of this process. And during our initial Buyer Consultation, I will have provided you with a copy of this document so you’ve hopefully had some time to review it and asked me any questions that you may have had.
Indeed, as part of the Intown Atlanta Real Estate Buyers Guide | Making Your Offer – The Contract, this is an important step on the way to owning that dream home you’ve found with me!
Looking for ALL the articles in our Atlanta Real Estate Buyers Guide? You will find them here!