Does it cost money to put in an offer? The simple answer to this question is, yes, you will need some funds when putting an offer on a home.
The seller will expect earnest and option money. The earnest money shows good faith and the amount can vary. Typically, the amount is about 1 to 1.5 percent of the total amount of the loan (or offer on the home). In some states, option money can also cost the buyer additional funds. Option money will hold the seller from accepting any other offers for a specified time, while the buyer is getting their loan in order. Option fee is typically .1 percent of the offer. Both the option and earnest funds can be applied to the closing.
So, let’s say your offer is accepted. It is recommended that you get a professional home inspection prior to the completing of the contract. The buyer is typically responsible for paying the inspector and these funds are not applied to the closing.
Also, the bank that is lending the funds will have the property appraised. This appraisal is charged directly to the buyer regardless if the home appraises for the amount of the loan or not.
Talking to a Realtor will help you understand what is expected when buying or selling a home.
Contact us directly if you are ready for the opportunity to be a homeowner!