Making an Offer
An offer to purchase is more than a number on a page — it is a formal legal proposal that, once accepted by the seller, creates a binding contract. Before submitting an offer, buyers should understand what goes into it and how each element affects their position. See what makes an offer competitive beyond price alone.
A standard purchase offer includes the proposed price, the amount of earnest money (a good-faith deposit held in escrow), your target closing date, and the contingencies you want in place. Contingencies are conditions that must be satisfied for the sale to proceed. The most common are a financing contingency (protecting you if your loan falls through), an inspection contingency (allowing you to negotiate or exit after an inspection), and an appraisal contingency (protecting you if the home appraises below the purchase price).
Contingencies Protect the Buyer
Common contingencies — financing, inspection, and appraisal — give buyers the right to exit the contract under specified conditions without losing their earnest money deposit. Waiving contingencies may strengthen an offer in a competitive market, but it also removes those protections. Understand exactly what you are giving up before agreeing to waive any clause.
Your agent will present the offer to the listing agent. The seller may accept, reject, or issue a counteroffer. Negotiations can move quickly — sometimes within hours in competitive markets — so be prepared to respond.
Going Under Contract
Once both parties sign, you are officially under contract and the clock starts on several parallel tracks: your due diligence period, your lender's underwriting process, and the title company's work to clear the title. Understanding what is happening on each track helps you avoid the missteps that cause deals to fall apart after going under contract.
30–60 days
Typical time from offer to closing
According to the National Association of Realtors, most purchase transactions close within 30 to 60 days of an accepted offer, though timelines vary by market and financing type.
2%–5%
Closing costs as share of loan amount
The Consumer Financial Protection Bureau estimates buyers should expect to pay 2% to 5% of the loan amount in closing costs, covering lender fees, title services, and prepaid expenses.
~5%
Contracts that fall through before closing
Industry data suggests roughly 5% of signed purchase agreements do not reach closing, most often due to financing, inspection, or appraisal issues.
Your earnest money deposit — typically 1%–3% of the purchase price, though it varies by market — is submitted to an escrow or title company at this stage. For a plain-language breakdown of these financial terms, see earnest money, due diligence, and closing costs defined.
Submit your pre-approval letter alongside your offer — not just a pre-qualification. Sellers and their agents treat pre-approval as a much stronger signal of financing readiness.
Pre-approval involves a verified credit check and income review, while pre-qualification is typically a self-reported estimate. The distinction matters to listing agents evaluating offer credibility.
Order a sewer scope inspection even when it isn't standard in your market. Lateral sewer line repairs can cost $5,000–$20,000 and are rarely visible during a standard home inspection.
Sewer line issues are one of the most common and costly surprises that surface after closing, yet they are routinely excluded from general inspection scopes.
Inspections and Due Diligence
The due diligence period — typically 7 to 14 days, depending on your contract — is your protected window to investigate the property. A licensed home inspector will examine the structure, roof, electrical systems, plumbing, HVAC, and other major components. The resulting report is your primary tool for negotiating repairs or credits, or for exercising your right to exit the contract.
Beyond the general inspection, consider specialty inspections based on the property's age, location, and construction: radon testing, pest and termite inspection, lead paint testing (for homes built before 1978), and — as experienced buyers often learn the hard way — a sewer scope.
Don't Make Large Financial Moves Before Closing
Avoid opening new credit accounts, making large purchases on credit, changing jobs, or moving significant sums between bank accounts between your accepted offer and closing day. Underwriters re-verify your financial profile shortly before closing, and changes can trigger a denial or delay — even after you've received conditional approval.
After receiving the inspection report, you have three common paths: accept the property as-is, request that the seller complete specific repairs before closing, or negotiate a price reduction or closing credit in lieu of repairs. Sellers are not obligated to agree to every request, so focus on safety issues, major systems, and defects that were not disclosed.
The Appraisal and Mortgage Underwriting
Your lender will order an appraisal — typically after the inspection period — to confirm the home's market value supports the loan amount. An independent, licensed appraiser visits the property and compares it to recent nearby sales. If the appraisal comes in below your purchase price, you face an appraisal gap: the lender will only finance up to the appraised value, leaving you to negotiate with the seller, cover the difference in cash, or exercise your appraisal contingency to exit.
“The period between accepted offer and closing is when most deals either solidify or fall apart. Buyers who stay organized, communicate with their lender daily, and don't make any financial changes tend to close on time.”
— Housing Finance Research Analyst, Mortgage market researcher and contributor to housing policy publications
Simultaneously, your loan file moves through underwriting — the lender's formal process of verifying your income, assets, credit, and the property itself. The underwriter may issue a conditional approval, requesting additional documentation before issuing a clear to close. Respond to any requests promptly; delays here directly push back your closing date.
Closing Day: What to Expect
Closing day is the final transfer of ownership. You will sign a substantial stack of documents — including the promissory note, deed of trust, and various disclosures — and pay your closing costs and any remaining down payment funds. Closing costs generally cover lender origination fees, title insurance, escrow fees, prepaid homeowners insurance, and property tax prorations.
Read Every Document Before You Sign
At the closing table you will sign a large volume of documents, including the Closing Disclosure, promissory note, deed of trust, and transfer paperwork. Review the Closing Disclosure at least three business days before closing — federal law requires lenders to provide it in that window. Compare it line by line against your Loan Estimate. Question any fee that wasn't disclosed or has changed unexpectedly.
Federal law requires your lender to provide the Closing Disclosure at least three business days before closing. Review it carefully against your original Loan Estimate, and question any fees that weren't previously disclosed or have increased without explanation. It is your right to understand every line item before you sign.
Schedule Your Final Walk-Through
Request a final walk-through within 24 hours of your closing appointment. Confirm that agreed-upon repairs have been completed, all negotiated fixtures remain, and the property is in the condition specified in your contract. If something is off, you have grounds to delay closing or negotiate a credit.
Once documents are signed and funds are wired, the deed is recorded with the local government — and you receive the keys. At that point, ownership transfers to you. Planning what comes next? The home maintenance hub is a practical starting point for every new homeowner.
This article is for general informational and educational purposes only and does not constitute legal, financial, or real estate advice. Consult a licensed real estate professional, attorney, or financial adviser for guidance specific to your situation.
