The 6 Basic Elements of Every Real Estate Offer

The 6 Basic Elements of Every Real Estate Offer

2 min read
Brandon Turner

Brandon Turner is an active real estate investor, entrepreneur, writer, and podcaster. He is a nationally recognized leader in the real estate education space and has taught millions of people how to find, finance, and manage real estate investments.

Experience
Brandon began buying rental properties and flipping houses at the age of 21. He started with a single family home, where he rented out the bedrooms, but quickly moved on to a duplex, where he lived in half and rented out the other half.

From there, Brandon began buying both single family and multifamily rental properties, as well as fix and flipping single family homes in Washington state. Later, he expanded to larger apartments and mobile home parks across the country.

Today, Brandon is the managing member at Open Door Capital, where he raises money to purchase and turn around large mobile home parks and apartment complexes. He owns nearly 300 units across four states.

In addition to real estate investing experience, Brandon is also a best-selling author, having published four full-length non-fiction books, two e-books, and two personal development daily success journals. He has sold more than 400,000 books worldwide. His top-selling title, The Book on Rental Property Investing, is consistently ranked in the top 50 of all business books in the world on Amazon.com, having also garnered nearly 700 five-star reviews on the Amazon platform.

In addition to books, Brandon also publishes regular audio and video content that reaches millions each year. His videos on YouTube have been watched cumulatively more than 10,000,000 times, and the podcast he hosts weekly, the BiggerPockets Podcast, is the top-ranked real estate podcast in the world, with more than 75,000,000 downloads over 350 unique episodes. The show also has over 10,000 five-star reviews in iTunes and is consistently in the top 10 of all business podcasts on iTunes.

A life-long adventurer, Brandon (along with Heather and daughter Rosie and son Wilder) spends his time surfing, snorkeling, hiking, and swimming in the ocean near his home in Maui, Hawaii.

Press
Brandon’s writing has been featured on Forbes.com, Entrepreneur.com, FoxNews.com, Money Magazine, and numerous other publications across the web and in print media.

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Instagram @beardybrandon
Open Door Capital

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Every real estate offer can basically be boiled down to the who, what, where, when, why, and how of the deal.

  1. WHO is making the offer and to WHOM?
  2. WHAT is being bought and for WHAT amount?
  3. WHERE am I getting the funds? (the financing)
  4. WHEN am I planning to buy it? (the closing date)
  5. WHY would I back out of this offer? (the contingencies)
  6. HOW is this all going to happen? (the fine print)

In essence, everything from a transaction can be summed up in this.

When offering on a deal on the MLS, your agent will likely walk you through every step of the document, but if you are offering on a property directly to a seller without an agent, you are on your own. Therefore, let’s go through these elements in a bit more detail.

The WHO and WHOM are fairly obvious when you’re making an offer. The WHAT and WHEN should be clear as well. So let’s focus on the WHERE, WHY, and HOW.

Related: 16 Tips for Getting Your Offer Accepted

Where Are You Getting the Funds?

When you submit an offer, you’ll likely include what kind of financing you’ll be using for the purchase. Will you be using all cash? Will you be obtaining conventional financing through a local bank? Will you be using private or hard money?

Most sellers want to know this information before they allow you to tie up their property for the next month or two only to back out at the last moment because you can’t actually buy it. If you are using financing, it can help to provide a letter from the lender showing that you have already been approved for a loan (known as a pre-approval letter).

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Related: How (and Why) I Offer on Properties BEFORE I Ever Step Foot in the House

Why Would You Back Out of the Offer?

In other words, what are the contract contingencies? Can the buyer back out if they can’t obtain financing? What if they find some surprise problems during the inspection, like asbestos in the attic or plumbing that hasn’t worked in a generation? What if the house appraises for far less than what was offered? Make sure your P&S document spells all this out.

How Will This All Happen?

In other words, the contract should spell out the exact process by which the sale will proceed. This includes all the small print that helps the title company or attorney know exactly how to move forward with the sale.

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Any questions about the offering process?

Comment below!