The Basics: What to Consider When Making an Offer on a Home in Maricopa, AZ
The Arizona Purchase Contract is what is used to make an offer on a house in Maricopa, AZ. It is a 10 page document full of details and information. Although there are many different situations, negotiations, and circumstances that can make an offer very complicated, I would like to discuss the basic items you should think about when making an offer.
Related: Pros and Cons of Living in Maricopa
- Offer Price: This is the biggest item to think about. How much do you want to offer on the home. This number can change in many ways. For example, perhaps you do not have the funds to pay your closing costs. You may want to have the seller pay them for you. This is called seller concessions. Since this weakens your offer a bit, you may consider raising your offer price about 3% to make up for the difference. Also, talk with your real estate agent about this number. Check some recently sold comps and see if your amount is over or under and why. Make sure you confirm with your mortgage lender that you are pre-qualified up to the amount needed unless you are paying in cash.
- Earnest Money: How much earnest money will you be paying? Earnest money is a promise you are serious about your offer. If for some reason you have to back out of the contract outside the legal boundaries, you may lose your earnest money to the seller. To figure out an estimate of what earnest money should be, you can use 1% of the offered price as a guideline. But consult with your realtor about this.
- Close of Escrow Date: When do you need to close or settle on the house? Is there a contingency on getting your current home sold? Typically, 30-45 days is an average closing time frame. Make sure you check with your mortgage lender about this to make sure they have enough time to set up your financing.
- Appraisal Fee: Many times when you are under contract on a home your mortgage lender will require an appraisal to be done on the property. If so, will you pay the appraisal fee or do you want the seller to pay it? Something to think about is if your appraisal comes in under the price you offered you may need to pay the difference in cash to make the deal work. You will want to hope the appraisal is higher than your offer price so things can move forward.
- Title and Escrow Company: The choice of who to use for the title and escrow company is yours. If you have a preference, tell your real estate agent to include it on the offer. Most of us don’t really know a title and escrow company, and in that case, your realtor can provide a recommendation.
- Assessment Liens: If there is a lien due to non-payment of HOA dues, do you want the seller to pay them in full prior to closing? Or should they be prorated and assumed by the buyer? Remember that any assessment that becomes a lien after close of escrow will be the buyers responsibility.
- Home Warranty: Would you like to obtain a home warranty on the property? Do you want to pay for it or would you like to see if the seller will pay? And who would you like to use as your home warranty company? If you don’t know who to use your real estate agent can also make a recommendation on that.
- Additional Terms and Conditions: Is there anything else you would want to note in the offer? Are there any contingencies? Is anything uncommon to the purchase contract that you would like to include? This is where you would do it.
- Terms of Acceptance: When would you like to have an answer from the seller about your offer? Today? Tomorrow by 5 p.m.? Or perhaps several days from now? It’s your choice. Just remember that if you wait too long other offers might come in that are stronger than yours and you could get rejected.
There is a lot to consider when making an offer on a home. And this is just the tip of the iceberg regarding the Arizona Purchase Contract. If you need a real estate agent, I’d love to work with you. Please contact me at the information below. Thank you!
To Buy or Sell a Home Contact:
Jason Bechtold, Realtor
The Maricopa Real Estate Company
Cell: (732) 306-7971