Start with the net amount
The net amount is what you'd walk away with after costs at closing. It's often the clearest way to compare offers side by side.
Two offers can be written in different ways. One may cover more closing costs, and another may ask you to cover some. Turning each offer into a net number makes the comparison simple.
- Ask each investor for an estimated net amount in writing.
- List the costs each offer expects you to pay.
- Include your mortgage payoff, if you have one.
Compare closing dates
Many investors are flexible on timing. Some can close soon, and some are happy to wait until a date you choose.
Think about what works for you. Do you need time to move? Are you waiting on a new home? The best date is the one that fits your plans.
Some investors also offer a short period after closing to finish moving out. If that would help, ask about it and get any agreement in writing.
Look at contingencies
A contingency is a condition that needs to be met before closing. Cash offers often have fewer contingencies than financed offers.
Read each offer to see what's included. Common ones are a walkthrough or inspection period and a clear title. Knowing them helps you compare offers fairly.
If an offer includes a walkthrough period, ask how long it lasts and what happens when it ends. Knowing the next step helps you plan with confidence.
- Inspection or walkthrough period.
- Clear title.
- Any approvals needed, such as for an estate or trust.
Earnest money
Earnest money is a deposit the buyer puts down after signing. It's usually held by the title company until closing.
Each offer may list a different amount and timing. Ask when it will be deposited and who will hold it.
Earnest money is one more term to line up in your chart. Like the other terms, it's easiest to compare when you have each offer in writing.
Who pays what
Closing costs can be split in many ways. Customs vary by state, and offers often spell out who covers each item.
When each offer lists the same costs in the same way, the net amount comparison becomes very clear. You can ask each investor to fill in the same list.
- Title insurance and title company fees.
- Transfer or recording fees.
- Prorated property taxes.
- HOA fees or transfer costs, if any.
- Cleanout or removal of items left behind.
Questions worth asking
Good questions make every offer easier to understand. Investors are usually glad to walk you through their terms.
- What is my estimated net after all costs?
- Which closing costs are you covering?
- What closing date works for you, and how flexible is it?
- Which title company will you use?
- What happens after the walkthrough?
- Can I leave items behind?
Putting it side by side
A simple chart can help. Put each offer in a column and list net amount, closing date, contingencies, earnest money, and costs in rows.
Once you see everything in one place, the right fit is often clear. If an offer includes legal or tax questions, an attorney or tax professional can help. This guide is general information, not legal or tax advice.
Remember that you can take a little time to review. Most investors expect questions and are glad to help you feel sure about your choice.
General information, not legal or tax advice.