The Basics of Making an Offer
Oral promises are usually not legally enforceable when it comes to the rental of real estate. Therefore, you need to enter into a written contract, which starts with your written proposal. This proposal not only specifies price, but all the terms and conditions of the transaction. For example, if the landlords said they’d help with a free month on a lease be sure that’s included in your written offer and in the final completed contract, or you won’t have grounds for collecting it later.
REALTORS® usually have a variety of standard forms (including Residential Lease Agreements) that are kept up to date with the changing laws. When you use a REALTOR® these forms will be available to you. In addition, REALTORS® cover the questions that need to be answered during the process. In many states certain disclosure laws must be complied with by the seller or landlord, and the REALTOR® will ensure that this takes place.
After the offer is drawn up and signed, it will usually be presented to the owner by your REALTOR®, by the listing REALTOR® if that’s a different agent, or often by the two together. In a few areas, sales contracts are typically drawn up by the parties’ lawyers.
What the offer contains
The offer you submit, if accepted as it stands, will become a binding contract. In many complicated deals or apartment leases A letter of intent, also known as LOI or Agreement to Lease is sent as the offer and it will serve as a “blueprint for the final deal.” It is simply easier to work with this then signing a 17 page lease document and sending it back and forth.
It’s important, therefore, that the contract or LOI contains all the items such as:
Address and sometimes a legal description of the property
Target date for move in
Amount of earnest money
Provisions about who will pay utilities.
You’re in a strong bargaining position — meaning, you look particularly welcome to a landlord — if (in order):
You have excellent credit
Ready to move in right away.
You will pre-pay all or some of your lease payments
Have all your supporting documentation with the offer
You don’t have a pet or a very large pet (if the community is pet friendly)
In those circumstances, you may be able to negotiate a deeper discount from the listed price. On the other hand, in a “hot” renter market, if the perfect home comes on the market, you may want to offer the list price (or more) to beat out other early offers.
It’s very helpful to find out why the home is being leased and whether the owner is under pressure. Keep these considerations in mind:
Every month a vacant home remains un -leased represents considerable extra expense for the owner;
This is a deposit that you give when making an offer on a home, now a days we usually ask for this once an agreement has been reached in principle. A REALTOR® or an attorney usually holds the deposit, the amount of which varies from community to community but is customary to be one month.
A landlord is understandably suspicious of a written offer that doesn’t come with a deposit a day or two after the terms have been agreed. So be prepared with your check to show “good faith.” Don’t worry your move in fees will be credited by the total paid into escrow.
Renters: the owner’s response to your offer
You will have a binding contract if the owner, upon receiving your written offer, signs an acceptance just as it stands, unconditionally. The offer becomes a firm contract as soon as you are notified of acceptance. If the offer is rejected, that’s that, and the owners could not later change their minds and hold you to it.
If the landlord likes everything except the price, or the proposed move in date, you may receive a written counteroffer, with the changes the owner prefers. You are then free to accept or reject it or to even make your own counteroffer. For example, “We accept the counteroffer with the higher price, except that we still insist on having an extra parking space.”
Each time either party makes any change in the terms, the other side is free to accept or reject it, or counter again. The document becomes a binding contract only when one party finally signs an unconditional acceptance of the other side’s proposal.
Withdrawing an offer
Can you take back an offer? In most cases the answer is yes, right up until the moment it is accepted, or even in some cases, if you haven’t yet been notified of acceptance. If you do want to revoke your offer, be sure to do so only after consulting a lawyer who is experienced in real estate matters.