Going back to the basics of contract negotiations... what are some of the necessities that have to be in there? This is a short list that I've complied for those who haven't purchased a house before (or for those who have!)
1. Financial terms/agreement. Ensure that whatever terms you are able to afford are written into the contract... If you cannot afford a certain percentage, ensure the agreement doesn't have a percentage point that is over it. You, the buyer, must pay attention to what it is you are signing. As they say, you are signing your life away. It doesn't have to be that way, but you have to pay attention and understand what it is you are signing. Its YOUR mortgage, not your agent's.
2. Who pays the closing costs? The agreement should say who is going to pay what. This is NOT the time for verbal agreements. Your real estate agent can advise you on how this is usually handled in your area.
3. If you are asking for the seller to pay a portion of the closing costs, THIS has to be spelled out in the agreement as well. Ensure the dollar amount of the percentage is stated.
4. Do you want the fridge, stove, washer/dryer etc? If so, this also must be spelled out in the agreement. Don't expect to walk in on the day you get the keys to your new home and have it all sitting there if it hasn't been spelled out in the agreement. Its negotiating for a reason... use these items to your advantage.
5. The home inspection. Make sure there is a home inspection contingency in your offer. If not, what happens if there's over $20K worth of fix-ups to do to your 'dream' house, that suddenly isn't your dream house anymore? This statement allows you to back out of the offer if something were to come up during the home inspection. You can also ask the seller to fix these items if you still want the house, but the more important thing is, you can walk away.
6. The all important closing date. When do you need to move in? Are you in a hurry or not so much? 30, 60, 90 days? Any of these can be used in negotiation. Make sure whatever time frame YOU need is spelled out in the agreement so there's no issue at the end.
7. Do you need to sell your home you're in now? Do you need THOSE funds to fund the new home? If so, you need this stated in the agreement - you'll need to state a reasonable time frame in which to sell your home.
Your real estate agent should know all these things, but YOU the buyer should have some idea of what is going on in the transaction and not be a lost puppy being led around either. Be educated!
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