How To Buy Your First Home - Step 7: Make an Offer

In case you missed the previous steps in my How To Buy Your First Home series: 

Step 1: Get Your Finances In Order
Step 2: Get A Mortgage Pre-Approval
Step 3: Calculate The Cost of Buying Your New Home
Step 4: Gather The Funds Needed to Buy Your New Home
Step 5: Pick Your Side Kick
Step 6: Let the House Hunting Begin
 

Read on, and if you have any questions, let’s grab a coffee (or iced tea if you’re like me and don’t drink coffee) and we can gab about the process of buying your first home. 

How To Buy Your First Home - Step 7: Make an Offer Karly Moore - Toronto Real Estate

Step 7: Make an Offer

Now that have found the home you want to make your own, the next step is to prepare an offer to submit to the seller, which is technically called an Agreement of Purchase and Sale. In order for me to prepare an offer on your behalf, we would discuss the following details: 

  • The size of the deposit you will provide within 24 hours of the offer being accepted
  • Your preferred closing date (the day you want to take possession of the property)
  • Your lawyer's contact information
  • What conditions you want in the offer (financing, home inspection?)
  • The purchase price you are offering


Should I have a financing and home inspection condition in my offer?

Unless we have had a home inspection done prior to you submitting your offer to the seller, I would always advise the buyer to include a home inspection condition. The length for this condition is usually for five business days (can be shorter or longer), meaning you have five business days to have the inspection done and remove your condition from the offer. I have outlined my thoughts on home inspections in my post Home Inspections: Important or Not? If you do not have a home inspector that has been referred to you, I have a couple home inspectors that I would highly recommend.

Whether you include a financing condition in your offer is totally your decision, although I think it’s better to be safe than sorry and include one. This gives you usually five business days to go back to your mortgage professional and show them the offer paper work for the property you want to buy and get an official approval from them for the financing of your new home. 

You may find yourself falling in love with a home that someone else (or several other people) have also fallen in love with. When more than one buyer submits an offer on a property at the same time it is called a multiple offer situation or a bidding war.

How will a bidding war change my offer?

In bidding wars, sellers will ideally want a clean offer with no conditions. Meaning buyers will be encouraged by the seller and seller’s agent to remove their financing and home inspection condition. Whether you feel comfortable doing this is ultimately up to you, and we can discuss your options prior to submitting your offer. Check out my blog post for more info on how bidding wars work

The details of your offer

Once I prepare the offer documents, you will need to sign them. But not before I go through everything with you to make sure you understand it all, feel comfortable with it, and don’t have any more questions. I have never liked the idea of people signing things without knowing what they are signing so I like to make sure I go through the entire contract, and answer all your questions.

The offer process

Once you have signed on the dotted line, I will present your offer to the seller’s agent. I like to present my client’s offer in person if possible because I feel it’s a better way to convey who you are and why the sellers should accept your offer. 

After I present your offer, there are three possible outcomes:

  • The seller can accept your offer, which is the best outcome!
  • The seller can reject your offer. It’s fairly uncommon for a seller to outright reject an offer and if this was to happen I would investigate to see why. 
  • The seller can ‘sign back’ or counter your offer. The seller wants to alter some part of your offer – this could mean they sign the offer back with a higher price, a higher deposit, a different closing date or they have removed or altered one of your conditions. 

If we get a counter offer, it is now your turn to either accept the changes the seller made or to counter back to the seller with your own set of changes. I will assist you through this process. It can feel a bit like a ping-pong match, but ultimately the goal is for both the buyer and seller to each a positive outcome - an accepted offer! 

Up next - Step 8: Closing the Deal and Moving In

Check out:  

Step 1: Get Your Finances In Order
Step 2: Get A Mortgage Pre-Approval
Step 3: Calculate The Cost of Buying Your New Home
Step 4: Gather The Funds Needed to Buy Your New Home
Step 5: Pick Your Side Kick

Do you have questions about the home buying process? That's what I'm here for! Drop me an e-mail or give me a call and I'd be happy to help.