Finally, the day you’ve been waiting for: Someone makes you an offer! Or maybe you even get more than one! It’s both exciting and a little daunting. But before you start celebrating, here’s how to prepare for that important day.

First, Contact Your Attorney

Selling a house is a complex legal transaction, so even before you receive an offer, contact a real estate attorney, who can prepare and handle the purchase agreement. Once you have a buyer, you’ll visit the lawyer, who will draft or review the purchase agreement, revise it as needed, and sign off. The buyer may also feel more comfortable handing over earnest money (a good-faith deposit) to an attorney instead of to you; your attorney can then put the money in a trust account.

Hearing the Good News

If a prospective buyer calls and offers you a price over the phone, encourage him or her to meet with you. That way you have a better chance of negotiating the terms and striking a deal agreeable to both of you. If you insist that buyers reply in writing, they may turn to a real estate agent (who might turn to you for a commission), or they may not even respond. Remember, you have to help the buyer "buy" your house. You could encourage the buyer to hire a real estate attorney for assistance, or you can hire your own real estate attorney to assist you. Either way, the attorney should represent only one party to avoid a conflict of interest. An alternative to a buyer contacting a real estate agent is for you, the seller, to consider paying the fee — obviously much less than a real estate commission — for the buyer to hire an attorney.

Reviewing the Offer

Although verbal offers are not legally binding in real estate transactions, even the most simple written offer may be binding if all parties sign it. Therefore, make sure all the terms and conditions are present in the purchase agreement before you sign it. You should also get the agreed-upon earnest money with the purchase agreement. Keep in mind that earnest money alone, without a signed purchase agreement, does not bind the buyer or seller to the sale. The purchase agreement should contain all agreed-upon terms and applicable contingencies, including, but not limited to, the buyer’s mortgage information, lead-based paint disclosure, sale of the buyer’s home, inspections, personal property, and well and septic disclosures.

1 - Work Out the Details
Before you sign the sales agreement, you and the buyer should use a simple nonbinding worksheet to detail the most important items that will go into the purchase agreement, including price, closing date, and personal-property items. These are the areas you are most likely to negotiate. Remember, don’t sign the worksheet; use it as a guide to agree on the details before your attorney helps you draft a purchase agreement.

2 - Earnest Money
Buyers should provide you with earnest money (a good-faith deposit) after the purchase agreement is signed. There is no required amount, but it’s common to get between 1 and 2 percent of the sale price. Although not required, it’s a good idea to have this money held in a trust account. Your attorney should be able to hold the earnest money as part of his or her services.

3 - Your Options
When you review the purchase agreement, your options are to:

• Accept the offer,
• Reject the offer (try negotiating first), or
• Counter the offer by changing some of the terms. This is called a counter offer.
  Make your changes on the purchase agreement and initial and date them. Stipulate how much time the buyers have to consider your changes (typically, two days). The buyers may choose to counter your offer or walk away from the deal. Just make sure you’re happy with the terms before you sign the purchase agreement.

Tips for Negotiating

• Determine ahead of time what amount you’re willing to accept.
• Avoid confrontation.
• Set a calm, relaxed mood.
• Be willing to compromise.
• Anticipate beforehand what negotiating position the buyers might take.
  Review their contingencies and plan your response

4 - Terms and Conditions
Important points to review in the offer:

• The bid: It’s an offer worth considering if it’s within 3 to 5 percent of your
  asking price.
• Financing: Make sure you get a preapproval letter from either the buyer or real
  estate agent (if you’ve agreed to work with one) that shows the buyer has been qualified for a certain loan amount by a lending institution. This is different from being prequalified, which is an initial indicator of the buyer’s likelihood of being granted a loan. But it’s not legally binding and doesn’t guarantee that the buyer will receive financing. If the buyer hasn’t been qualified, make sure to indicate in a counter-offer document that you must receive a preapproval notification letter within five to seven days indicating that the buyer has qualified for a loan or you’ll cancel the sale.
• Contingencies: Buyers often add reasons why they would cancel their offer, such as they can’t sell their house, your home doesn’t pass their professional inspection, or something in your house wasn’t fixed. It’s your choice whether to agree to these contingencies, but weigh them carefully. You can always say no to "fix-up" contingencies, which ask that repairs be made, by stating that the house will be sold "as is." Or you can reduce your price for the cost of the repairs. If the potential buyers indicate they will buy your house contingent upon the sale of their house, stipulate that you’ll leave yours on the market and can sell it to another buyer if one comes along. Remember, most purchase agreements are contingent on the buyers receiving approval for their loan.
• Home inspections: The buyers may request an inspection
  of your property by a professional. If you agree, you increase the chances of a sale because you’re essentially saying that you have nothing to hide. If the buyer chooses not to have an inspection, it’s a good idea to include a clause in the purchase agreement stating that the buyers declined the opportunity.
  Inspections performed include:
  - Heating and air conditioning
  - Roof
  - Electrical and plumbing
  - Foundation and basement

5 - Disclosures
Provide the buyer with your Real Estate Transfer Disclosure Statement and/or truth-in-housing report before the purchase agreement, and make sure the purchase agreement acknowledges that the buyers have reviewed them.

6 - After the Inspection

• You have the option either to repair any problems or not repair them and return the earnest money to the buyers, canceling the deal.
• The buyers can walk away from the deal if they’re unsatisfied with what the inspection reveals.

7 - Multiple Offers
In some hot housing markets around the country, many home sellers receive more than one offer on their homes. Here’s how it can happen.

Let’s say you receive a purchase agreement from a buyer, which probably will state that you have from 24 to 48 hours to respond to the offer. But during that time, you receive other offers on your home. What do you do?

Treat the first party fairly by disclosing immediately that you’ve received other offers. (But don’t disclose the terms of those offers.) This approach can work in your favor: a buyer who seriously wants your house may choose to submit a new, higher offer.

Because some of the offers you’ve received may stipulate that you must decide within 48 hours, you need to act quickly and review each one. Don’t automatically choose the offer with the highest price. Be sure to consider the proposed closing dates, how each buyer will finance the home, and whether the buyers are prequalified or preapproved for their loans.

Once you’ve decided which offer you’re interested in, you can either accept it as is or counter it by changing specific details. As in the typical negotiation process, you and the buyer will discuss the various points until you reach an agreement. If you can’t do that, call those who made the other offers to see if they’re still interested, and then begin the negotiation process with one of them. Remember, if you respond in writing, deal with only one purchase agreement at a time.

Now that your hard work has gotten you a serious offer that you’ve accepted, you’re ready to sign on the dotted line and… Close the Deal.