Though most buyers focus on the offer price, an offer contains both the offer price and terms. In the Nashville home buying market, these terms can make your offer much more appealing and in many cases the terms of the offer are as important as the price.
Terms can represent thousands of dollars in additional value for buyers or additional costs. The offer terms are extremely important and should be carefully reviewed.
You sometimes hear that the amount of your offer should be a certain percent below the seller’s asking price or an amount less than you’re really willing to pay. In the Nashville housing market, many buyers are competing for a limited number of homes resulting in many offers coming in at or above what the sellers’ asking price may be.
If the Nashville market changes and demand is weak, then offers below the asking price may be in order. This was the norm in our housing market just a few short years ago!
How Do You Make an Offer?
Typically, we will talk through the purchase and sale agreement during our initial buyer meeting. You should already have a copy for reference. During the offer process, I will need:
Full legal name: Please email me the full legal name of anyone who will be on the contract as well as their phone number and email address.
Offer price: What price do you want to offer for the home? Let’s have a discussion about the sale to list price in the neighborhood if we haven’t already as that will tell you a lot about whether you should expect to pay below asking price, asking price, or above asking price based on today’s market.
Your walk away price: Don’t expect to pay your initial offer price as it’s rare for a seller to accept your initial offer without some negotiating back and forth. That’s why it’s called an initial offer. In addition to deciding what offer you want to put in to start, I need you to decide now how much you’re willing to pay for this property and what your walk away price is before thing get heated and emotional.
Closing date: Typical financed homes in Nashville take 45 days to close from contract acceptance. Sometimes you can ask for a longer closing date depending on the seller’s needs, but I wouldn’t expect it. Therefore, if you want to move around July 1, plan on putting in offers mid-May. Exception - If you’re paying 100% cash you can often close faster than 30 days.
Trust money: How much money are you comfortable putting down on this property? Typically, contracts in Nashville ask for 10% of the purchase price as earnest money, although I usually write 1% in my contracts. Generally the payment is due 1-2 business days after you and the sellers have signed the contract. The trust money is part of your down payment.
Closing cost credits: Do you want to ask for any credits for closing costs which would go towards the amount of closing cost fees you have to pay for on top of your down payment?
Home warranty: Do you want to ask the seller to provide a home warranty on the property?
Contingencies: Any other contingencies I need to be aware of? Do you need to sell your current home before we can buy this home?
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