Filled with mysterious acronyms and confusing terms - we created these resources to demystify the real estate business.
Earnest money is the money you put down on a home when you make an offer. It’s a way to show to the seller that you’re serious or “earnest” about wanting to buy their house.
The down payment is a percentage of the home cost you pay directly to the seller. The amount of a down payment can be anywhere between 3% and 20%. So, if you’re buying a $100,000 home, your down payment could be anywhere from $3,000 to $20,000.
Finally, closing costs refer to the costs associated with processing all of the documents related to your home loan, appraisals, etc. Closing costs run around 3% – 5% of the cost of the home and can paid by either the seller or the buyer. They’re paid at the time of “closing,” when you sign all the paperwork that seals the deal.
This is where your Rilio agent will say, “‘We got this’ is not just a slogan.” Knowing how much to offer on a home is just one of the many reasons you want a trusted real estate pro in your corner. Your realtor will help you develop a competitive offer based on things like:
- Comparable home prices in the area
- The overall condition of the home
- How long the home’s been on the market
- How much mortgage is required
- How competitive is the current market
And, of course, how much you really want the home.
Let’s face it. No one likes to be rejected. But when we’re talking real estate offers, rejections are often part of the process. Don’t be discouraged. Your Rilio agent has ninja-level negotiation skills. They may suggest you offer more money in exchange for closing costs, a carpet allowance or specific repairs. The point is, everything is up for negotiation and it’s your realtor’s job to flex their arbitration muscles on your behalf.
Well, it all depends. The biggest challenge with doing this, of course, is potentially overextending yourself. For example, you don’t want to have an offer accepted on a house you want to buy, then not be able to sell your current home. In situations like this, buyers who need to sell their current home will often make a “contingency offer.” Such offers are, like their name implies, contingent upon the sale of their current home and only goes through when they sell their house.