This guide details the process of submitting an offer to purchase real estate in the state of Indiana. These steps include:
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An Indiana real estate offer is made of of about 8 forms. These forms include:
When we submit an offer to purchase real estate, we have to show where the funds are going to come from to purchase the property. If you are using a home loan to purchase the property, then we would submit the loan pre-approval. If you are purchasing the property with cash, then a bank statement would usaully be what we submit with the offer.
The Purchase Agreement that most people think of when you think of what gets filled out to submit an offer. The Purchase Agreement spells out all the terms and conditions of the purchase including: purchase price, closing date, appliances included, other items included in the sale, number of days to complete the inspection, and many other terms like that.
Any issues with the property that the sellers know about, the seller is legally required to disclose to the buyer before submitting an offer. This form lists all the various components of the home, and the seller has to mark for each compnent if the component is defective, not defective, or not applicable.
Any homes built before 1978 are required to have a lead based point disclosure. The seller fills out this form and is legally required to disclose if they have any knowledge of lead based paint being in the property. The disclsoure generally has 2 boxes where a seller can cehck, one box states they do know of lead based paint being in the home, and the other box states that the seller does not have knowledge of lead based paint being in the home. If the seller knows of lead based paint being in the home, then the seller is required provide any documentation of the lead based paint. These forms almost always state that the seller has no knowledge of lead based paint being in the home.
This form requests for the seller to pay the buyer broker commission. Prior to August 2024 this form was not needed as the MLS would state the commision amount the seller was paying the buyer broker. A legal change happened in August 2024 where the seller is no longer legally allowed to advertise the buyer agent commision being offered, and the second change was that this form has to be included for the seller to pay the buyer agent commision.
Affiliated Business Disclosure, Agency Office Policies, and Wiring Fraud Advisory Notice are the buyer brokerage forms we have at eXp Realty. Each brokerage will have slightly different versions of these forms, and may have additional forms than these forms. The Affiliated Business Disclosure form generally states that eXp Realty owns or has interest in other companies in the real estate space, the Agency Office Policies disclosure addresses the policies of eXp Realty, and the Wiring Fraud Advisory Notice points out that caution is needed when wiring funds and that wiring fraud is real and rampant (ask me about my crazy wiring fraud story.)
Earnest money is the buyer’s “skin in the game” to show the seller that the buyer is serious about their offer and is willing to put out money to secure their interest in the home. The Purchase Agreement will state how many days after acceptance of the offer the buyer has to submit the earnest money, which is usaully 2 or 3 calendar days.
Either the listing agent’s brokerage, or the title company will hold the earnest money. Most all offices will accept earnest money payment in the form of a cashier’s check, some will accept a personal check, and most have an electronic payment option. We will find out the details of how the earnest money process works and send you an en email with all those details.
The earnest money will count towards your down payment, or if the deal falls apart, then the earnest money gets returned to you. The only time you would not receive the earnest money returned is if you fall in breach of contract (which is pretty hard to do).
After the seller accepts your offer, we then turn out attention to the home inspection. The Purchase Agreement will state which date the “inspection response” is due. The Inspection Response is the form we submit to the listing agent that states which work we are requesting to have completed, and is usaully due within 5-7 days after offer acceptance. There’s often a negotiation of inspection repairs, so sometimes you need to ask for a little more than what your bottom line requests are, so there’s some strategy we will talk through at that time.
I find that most home buyers generally think that when you call an inspector to complete a home inspection, that the inspector inspects everything that you would want them to inspect, after all, they are the experts, right? This was my understadning also when we bought our first house. Unfortunatley, I was wrong about that, and things I thought would be inspected were not inspected. When you call an in inspector to call an inspection, that generally means that they are inspecting the house structure and components inside and out, which is great, but there may be other things you want (or ned) them to inspect. The main types of inspections are:
Once you have decided which types of inspections you want to have completed, you then schedule the inspections. Our Preferred Vendors page lists inspectors that we have had positive experiences with. Inspectors can be booked out for some time, so as soon as the seller accepts your offer you will want to get the inspections scheduled as soon as possible.
About half of our Clients attend the home inspection and about half of our Clients do not attend the home inspection. You do not have to attend the inspection, but we find that attending the inspection will help you learn a lot about your new home. Personally, I would attend the inspection to get better educated on your new home, and the Inspectors often have tips and trips about home ownership and maintenance that are helpful to learn.
About half of our Clients attend the home inspection and about half of our Clients do not attend the home inspection. You do not have to attend the inspection, but we find that attending the inspection will help you learn a lot about your new home. Personally, I would attend the inspection to get better educated on your new home, and the Inspectors often have tips and trips about home ownership and maintenance that are helpful to learn. But, if you can’t make it to the inspection, that’s no big deal – the inspector will send a detailed inspection report that lists every comment they identified, and also includes a summary section that lists the big picture findings.
After the inspector sends out the inspection report we will have a call to discuss the report and determine which repairs we will request. Some home buyers have the misunderstanding that we simply take the inspection report and give it to the seller and tel the seller that we want them to repair eveything in the inspection report, but that’s not how the process works.
The inspection report will contain many comments that aren’t needing repairs, such as the inspector may include a copy of picture of the roof and state that the roof appears to have about 5 years of life left – that comments is just for your knowledge, and the seller wouldn’t be responsible to provide a new roof just because there is 5 years of life left on the roof. The home inspection process is supposed to be limited to the safety and functionality of the home, so things like nicks in the wall, or dirty windows is really beyond the scope of what the inspection is for.
Common items that are in the scope of what the seller would be responsible to repair are electrical outlets not wired properly, dripping faucets, furnaces or air conditioners not working properly, windows that do not open or close properly, appliances not working properly, and many other items.
To provide our inspection response we use a standard form titled “Buyer’s Inspection Response” that lists the repairs we are requesting, and the buyer will digitally sign the form before I submit the Inspection Response to the seller.
Once we have our list of repairs we want the seller to complete, we will discuss strategy of the repair requests. Much like the processing of submitting an offer on a home where it becomes a negotiation, a similiar negotiation process often unfolds during the inspection process. From a negotiation standpoint, we would often want to request a little more repairs than what our bottom line repair requests are, as the seller will often push back against some of the repair requests. Or what often happens is that in lieu of ths seller having all or some of the repairs completed, that the seller will offer a credit to the buyer so that the buyer can have the repairs completed after closing. A seller credit is often a great solution so that you as the buyer can confirm the work is completed to your satisfaction.
Note that if you are using USDA, FHA, or VA financing, that those agencies will also complete their own inspection and will provide non-negotiable repair demands. So, with these financing types there is essentially 2 seperate inspection processes.
The seller will then review our Inspection Response, and draft a Seller’s Response to Buyers Inspection Response and send that back to me. The seller’s response could either be: 1) acceptance of our repair requests, 2) rejection of our repair requests and request cancellation of the contract, or 3) a counter offer that proposes a negotiated scope of repairs.
This back-and-forth continues until agreement is reached. If agreement cannot be reached, then a “mutual release” will be circulated for both the buyer and seller to sign to cancel the contract.
Now that the buyer and seller have agreed to the scope of repairs, the seller is responsible for having the repairs completed. The seller is requested to provide receipts and photos of work completed by contractors. At the final walk through (which usaully happens the day before or the day of closing), we will check to make sure all the repairs are completed. If the repairs are not completed and it is too close to closing to have time for the remaining repairs to be completed, then the seller can be requested to provide a credit to the buyer to cover the cost of the remaining repairs, or the closing can be pushed back to allow time for the repairs to be completed.
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