Just Put in an Offer on a Home? Here's What to Expect

Making an offer to buy a house can be both exciting and stressful. The seller can reject your bid, make a counteroffer or accept your original proposal. Your response depends on how the seller replies.

If the Seller Rejects Your Offer

The seller may deny your home purchase offer for various reasons. Your bid may need to be higher, your contract contingencies may be undesirable or other buyers may have more attractive financing requirements. The other party has no obligation to respond to you, but your real estate agent can reach out to learn their motivation for declining your proposal.

The question is — will you move on or keep pursuing a deal? You can walk away and try your luck with the other homes you love or wait for an answer until the deadline stated in your offer in hopes of heading to the negotiating table.

If the Seller Makes a Counteroffer

The seller is more likely to negotiate with you than reject your bid outright. They may express interest in your offer and send a written counteroffer requesting some terms be changed. The seller may want more money, to move the closing date later or to add or remove specific contingency clauses. You can say no to the counteroffer, accept it or propose new changes to the contract. Your real estate agents can go back and forth multiple times until all parties agree to everything or reach an impasse.

If the Seller Takes Your Offer

You have a deal once the seller accepts your initial bid or counteroffer. Arriving at a verbal agreement differs from being in a contract. Your offer will only become legally binding if the seller signs it. Once the document has signatures from both parties, do the following to see the agreement through:

Deposit Earnest Money

Pay an earnest deposit — 3% to 5% of the selling price — to show you’re serious about the purchase. A third party holds the funds in escrow and generally applies it to your closing costs or down payment at closing. Earnest money can be refundable if you structure your bid correctly.

Secure a Mortgage

Present your home purchase agreement with your chosen lender and submit the other requirements for review. The mortgage lender has three business days to give you a good-faith estimate or reject your application.

Schedule a Home Inspection

If you include an inspection contingency, hire an inspector to evaluate the house’s condition within the agreed-on period. The inspector will discover if the seller didn’t maintain the home properly. For example, worn-out shingles and clogged gutters can be signs of neglected roof maintenance. They will also look for other issues deeming the house unsafe, such as cracked siding and mold growth. If the inspection finds the house is unfit for occupancy, discuss with the seller who should pay for what and schedule repairs immediately.

Wait for the Appraisal

The lender will hire an appraiser to determine the house’s fair market value. The report will reveal whether the selling price is higher or lower than its actual worth. You can proceed with the purchase regardless of the appraised value, but you may have to put down more for an overpriced house since most lenders won’t lend more than the appraised value.

Do a Title Search

Find out if there’s any cloud on the title — like a fraudulent document or an ownership claim from an undisclosed heir. Ask your real estate agent about which title company to use. The seller can pick a different one.

Connect Local Utilities

Once you know your move-in date, contact local utility providers to discuss when to set up your services.

Buy New Homeowners Insurance

Call an insurer about getting a policy for your new home. If the property is prone to extraordinary perils, you may have to get more than the basic coverage.

Do a Final Walkthrough

Once any repairs are finished, tour the property one last time with your real estate agent to ensure its condition is satisfactory before signing on the dotted line.

Finalize the Closing Date

The closing date usually occurs between 30 and 60 days after the offer becomes legally binding. Ideally, all parties — you and the seller, your agents, title company reps and possibly a state-required attorney — should agree on the date and be present to ensure a smooth transaction.

Set Your Expectations Accordingly

Putting an offer on a home can be nerve-racking, especially when buying a house for the first time. Use an experienced real estate agent to help you navigate the process and protect your best interests every step of the way.

Evelyn Long is the founder of home living magazine Renovated where she writes about the current housing market and real estate. She has also written for publications like National Association of Realtors, Building Enclosure, and McKissock.