Buyer Information

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Please provide the full legal name of each buyer.  If there is more than one buyer, please provide both.

Please provide the best email address for each buyer listed above.  Much of this process will be done via email, so it is important to provide email addresses that are frequently checked.

Please provide the best phone number for each Buyer listed above.  If there is a particularly good or bad time to call, please include that information as well.

Please provide the street address (including unit number if applicable), city, state, and zip code for the property you wish to purchase.

This is up to you as the buyer.  You can offer the full amount of the list price, or you can offer less than the list price (or even more if you really want the house in a competitive market).  Generally, the closer you offer to the list price, the more likely the seller is to accept your offer.  With that said, in a market that is not red hot, it is not uncommon for a seller to entertain an offer slightly lower than the list price.

Financing is when a buyer borrows money, typically from a bank, using a mortgage loan to purchase a property.  If you plan to purchase the property without a loan using cash, then you will not be financing your purchase.

If you plan to use financing, you should speak with a mortgage lender prior to writing an offer so that you have a solid understanding of your purchasing power.  A mortgage lender will be able to provide you with different options for loan programs with various terms.

If you plan to use a conventional loan (30-year, fixed rate) to purchase a primary residence, the most common amount to finance is 80% of the purchase price, meaning that you would pay 20% of the purchase price in cash.

There are many different types of financing, including conventional 30-year, fixed-rate mortgages, unconventional mortgages, VA financing for Veterans, FHA financing, and numerous others.  A mortgage lender can advise you on the various types of loans and what makes the most sense for you.

The Consumer Financial Protection Bureau provides a good summary of different loan types at https://www.consumerfinance.gov/owning-a-home/explore/understand-the-different-kinds-of-loans-available/

Earnest money is a portion of the purchase price of a home that the buyer pays upfront after signing the purchase contract. Once paid, the earnest money is generally non-refundable upon the buyer’s termination of the contract unless a legal justification for the termination exists or the contract says otherwise. The purpose of the earnest money payment is to discourage the buyer from backing out of the contract after signing and to compensate the seller in the event of the buyer’s unjustified termination.

Rather than paying the earnest money to the seller, the buyer usually delivers the earnest money to an agreed-upon third party, the title company, who holds the earnest money for safekeeping until the sale closes or terminates. If the sale successfully closes, the title company credits the earnest money to the buyer. If the sale terminates without closing, the title company releases the earnest money to either the buyer or the seller, depending on the terms of the contract and the circumstances that led to the termination. 

The amount of earnest money that you offer is entirely up to you.  In speaking with many Texas real estate agents, 1% or more of the overall purchase price is a frequent recommendation, though the exact amount is an object of negotiation between the buyer and seller.  Remember, the earnest money is not delivered until after both parties have signed off on the deal terms of the offer, and the amount is credited to the purchase price.

The title company’s release of the earnest money to the buyer or the seller is often the biggest point of contention after a sale falls apart. Many buyers find it financially unfeasible to fight a legal battle to get their earnest money back from an uncooperative seller, even if their termination of the contract was completely justified. For this reason, we caution first-time home buyers not to commit more money than they can afford to lose when putting down the earnest money for a home. 

Generally speaking, the more earnest money offered, the  more attractive the offer is to the seller, as the buyer will have more "skin in the game".

The termination option allows the buyer to pay a small, non-refundable fee on top of the earnest money after signing the purchase contract. In exchange for this extra payment, the seller agrees to give the buyer an agreed upon number of days following the signing of the purchase contract during which the buyer can terminate the contract for any reason (or no reason) and receive their earnest money back. 

During this “option period,” the buyer should have a general home inspection performed on the property along with any specialized inspections that the unique characteristics or history of the property may warrant (e.g. foundation, plumbing, wood-eating insects, etc.). If the inspections reveal previously unknown defects that render the home undesirable in the eyes of the buyer, the buyer can exercise their termination option and walk away from the deal, losing only the option fee and the cost of the inspections. Inspections can still be performed after the option period lapses; however, if the buyer chooses to terminate the purchase based on the results of an untimely inspection, they may forfeit their earnest money or face adverse legal action by the seller. 

The amount of the fee that the buyer pays in exchange for the termination option and the length of the option period are negotiable between the buyer and seller, and we encourage first-time buyers to bargain for as long an option period as the seller is willing to grant. Having enough time to get a thorough home inspection done while you still have the option to terminate can potentially save thousands of dollars if the house turns out to have unforeseen defects.

In speaking with many Texas real estate agents, offering between $100-200 per day of the option period is common.  We typically see option periods in the 5-10 day range.  This should provide you with sufficient time to schedule an inspection, receive the inspection report, strategize about how to proceed, and potentially renegotiate the deal as a result of the inspection or other factors.  If your circumstances are such that a longer option period is needed (e.g., if you live out of state and need to travel to Texas to see the home in person), then you should take that into account when determining the length of the option period.

Yes, you can try to renegotiate the terms of the deal during the option period.  This is typically done if something unforeseen and significant arises as a result of the inspection.  The renegotiation usually involves either the seller agreeing to reduce the overall purchase price, or the seller offering to have the issue repaired.

For example, if the inspection uncovers that the hot water heater is at the end of its useful life and a new heater will be needed soon, the buyer may ask for a reduction in the price of the home to reflect the cost of purchasing and installing a new hot water heater.  Alternatively, the seller may agree to simply replace the hot water heater rather than reducing the purchase price.

It is important to note that the seller in no way is obligated to agree to the renegotiation of any deal terms.  The risk the seller runs in refusing to renegotiate is that the buyer terminates the contract and walks away from the deal using the termination option.  The cost to the buyer to terminate the deal is the amount of the option fee.  This incentive structure should facilitate a good faith renegotiation between buyer and seller during the option period.

A real estate closing in Texas is the final step in the home buying process, when the buyer and seller sign documents to transfer ownership of the property.  This typically takes place in the title company's office, but sometimes can take place remotely if needed.  At closing, escrow funds are cleared to be delivered to the seller, and the buyer receives the keys to the property.

If you are using conventional financing, 30-45 days after the contract is signed is usually a safe amount of time for the bank to complete the loan process.  Other lending programs will take different periods of time, and should be discussed with your lender.  If the purcahse is entirely in cash, 10-14 days from signing the contract is typical.

Title companies recommend closing on a Tuesday, Wednesday, or a Thursday.

In Texas, a non-realty item is a personal property item that is not included in the sale of a home, but can be added to the purchase through the sales contract.  Common examples of non-realty items include:  refrigerators, washers and dryers, draperies, wine fridges (if not built-in), outdoor furniture, and potted plants.

Items that are attached to the home are not considered non-realty items and are included in the sale unless the seller specifically excludes them in the sales contract. A good rule of thumb is that if an item requires a screwdriver to remove, it's attached and conveys with the home.  But if it is hung with a nail, it’s not a fixture and does not convey with the home. If it’s only attached by an electric plug, it is not a fixture and does not convey. 

When it comes to purchasing specific furniture that belongs to the seller or other unique items, like art, we recommend keeping the transaction to purchase those items seperate from the sales contract for the home itself.

We should be as specific as possible when including non-realty items into the sales contract.