09/07/2020: Making an Offer on a Home
This is the seventh in a series of videos and articles inspired by Mars Bank’s First Time Homebuyer live events. Sign up today for our free online first time homebuyer seminar.
Are you curious to know what is involved in making an offer on a first home? Deciding on which home to buy can be nerve-wracking. At Mars Bank, we want to set you up for success! Here are two key factors to consider when making an offer on a home: the price and contingencies. Learn the facts and be ready when you find your dream home! Price There are many factors that go into making an offer to purchase a home. When considering an offer, it is important to take into account the condition of the home, a fixer-upper can mean a discounted price! However, the first thing you want to consider is how much you can afford. A true pre-approval from Mars Bank will help you understand what you can afford, even before you start looking for a home. For a pre-approval, you will provide personal and financial information to the lender from which the bank determines the amount of mortgage for which you will qualify. Additionally, it is important to know what the demand is for the house you want to purchase. Sometimes when you’re looking for a house, there’s more than one buyer that is also considering the home. Even if it’s the one that you fell in love with, other people can fall in love with it, too. This competition will inform your offer. If you love the house, you might be willing to offer above the asking price. That is why it’s important to keep the price in mind (and the amount of the pre-approval) when considering making an offer on a home. Contingencies With every home purchase there are contingencies to the sale. Contingencies are situations that may arise that are not foreseen when entering a purchase agreement. For instance, the mortgage contingency would mean that the sale is contingent upon you being approved for the loan. If you were not able to get the loan for the purchase price, you would not be required to purchase that home based on that mortgage contingency. Another common contingency is a home inspection. A home inspection is done to assess the condition of the home you’re agreeing to purchase. Inspections include review of all the mechanicals, the structure of the home, radon test to determine the air quality level, and wood infestation evaluation to determine whether there are any wood-destroying insects present in the home.
Contact Mars Bank today if you’re looking into buying your first home. We want to help you understand the home buying process. Contact us to learn more or ask a question regarding any part of the homebuying process.
Considering a first home purchase? Sign up today for our free online first time homebuyer seminar.