Once you have found your dream home, you will need to determine how much you would like to offer. Remember: the more competition there is for the house, the higher the offer should be, and occasionally this may exceed the asking price. The next step will be presenting the Listing Agent with a written offer. When an offer is accepted by the seller, it becomes a legal contract; therefore when you submit an offer, be prepared to pay an Earnest Money deposit. This deposit will guarantee your intention is to purchase the property. The seller may now stop considering other offers, knowing yours is valid and serious. After Kendra presents your offer to the Listing Agent, it will be accepted, rejected, or the seller will suggest a counter offer. Negotiation of terms will begin, if appropriate. During this time, the property should be professionally inspected. The contract procedure for most single-family home purchases is standard and followed quite closely by most builders and REALTORS®.

The Purchase Agreement used is a standard document approved by the Grand Rapid Administration. Buyers may retain lawyers to review the transaction contract, yet this is not necessary if represented by an Agent. Bellabay Realty has more experience writing and negotiating real estate contracts than the average real estate office. The Purchase Agreement constitutes your offer to buy, and once accepted by the Seller, becomes a valid, legal contract. It is essential to understand what is written on the contract offer, which will be prepared according to your instruction. In general, the contract requires your name, tenancy, Earnest Money deposit, inclusions and exclusions, Title Insurance policy, date for closing, purchase price and terms, date of possession, and signatures.

This refers to the name under which you wish to take title. Please read the section detailing Title. Many people use their full legal name; keep in mind that you must use this same name to transfer title or sell the property.

This refers to how you “take title” to the property. It signifies your interest in the property and your rights of survivorship. How you take title to a property is a legal decision, therefore you may wish to discuss which form of tenancy is best with your attorney. Your Agent cannot, legally, advise you how to take title.

The amount of Earnest Money due varies with the value of the property and is negotiable. The range is usually between 1 to 5%, and is rarely less than $1000.00. Its purpose is to show good faith that your offer is serious. It also serves as a source of payment for damages to the seller, should you default on the terms of the contract. A personal check is sufficient and should be made payable to the real estate company or the closing agent.

The legal description is the technical information from the government regarding plant location, section, etc. The street address is the information you will be familiar with.

This section details the agreed purchase amount, terms of down payment, loan amount, interest rate, and any other loan conditions. A description of the loan will be required. In new construction, the builder will most likely provide specific loans with terms detailed by the company. If you have not yet received loan approval, you need to specify the interest rate, loan conditions, and down payment limits which are acceptable to you.

This section details all items that are not permanently attached to the real property. Two conditions may apply: the items may be included in the purchase price, or the seller may choose not to include the items. Some examples of these items are window coverings, refrigerators, stoves, dishwashers, microwaves, sheds, dog houses, and garage door openers.

The contract should detail all liens, encumbrances, easements, restrictions, etc., which are not recorded. You should have someone explain the liens, encumbrances, etc., which are recorded.

Any special assessments should be revealed by the seller. For example, if a property recently received a special assessment to build new sewers, issues to be addressed include payment, time line, etc.

You retain the right to request a physical inspection of the property and its inclusions. If the inspection proves unsatisfactory, an established time is granted to purchaser and seller to reach a settlement of for corrections.

A title insurance policy is required by the lender, which is paid for by seller. The buyer is required to purchase a mortgagee policy; these fees will be included in your closing costs.

The closing date will be scheduled after all financing and inspection contingencies have been met. This time in the contract process if referred to as a “Good Funds” state, meaning all moneys at closing must be certified funds (cash, electronic transfers, certified check, Cashier’s check). You will be notified prior to closing of the amount you will need, so you have ample time to obtain your funds.

It is customary for all monies and documents to be handled by the Title Company (i.e. the closing agent). The closing agent acts as a depository for funds: they disburse funds to the proper parties and handle the adjustment of taxes and insurance between buyer and seller. They are also responsible for obtaining pertinent documents including deed and title insurance policies, and are responsible for the recording of documents with the state.

This information addresses consequences if the seller should not relinquish occupancy.

Although this date is negotiable between the buyer and seller, it is customary for possession to occur on or up to 3 to 5 days after closing.

This information addresses consequences if the seller should not relinquish occupancy.

This is where you put all items which may be in doubt or which could be contested later. For example, what fixtures go with the house? If it is a new home, does the builder assume any responsibility for corrective work? Is there something that must be done before you will buy the house? If so, put each item in a “Contingency Clause.”

Michigan state law requires that the offer and acceptance must be in writing. If acknowledged in the body of the contract, fax signatures will be binding until original signatures are obtained.