Making an offer on a home is a pivotal moment for first-time buyers. With the right preparation, including pre-approval, proof of funds, and a smart strategy, you’ll be ready to compete and move forward with confidence.
It's hard to overstate the importance of the offer-making process. An offer is often the initial line of communication between a buyer and a seller and can make or break the chances of a successful deal.
In this step-by-step guide, I’ll go over everything first-time buyers should know about making an offer on a house, from what you need to do to get started to what comes next once you have a property under contract.
What You’ll Need Before Making an Offer on a House
An effective real estate agent will ensure their clients are ready to make an offer before they even begin looking at homes.
If you’re planning to use a mortgage – as 91% of first-time buyers do, according to the National Association of Realtors – this means being pre-approved by a lender. You’ll also need to prove you have the funds to cover upfront home purchasing costs.
Pre-Approval vs Prequalification
Many first-time buyers I speak with are confused by the difference between being prequalified and pre-approved for a mortgage. That’s understandable, especially when the terms often seem to be used interchangeably, but it’s an important distinction to make.
Prequalification offers a basic estimate of how much you can afford to spend on a home. This figure is based solely on the information you've provided, such as how much you earn, the down payment you have available, and any other debts you're responsible for paying.
Because the lender hasn't verified these figures, prequalification doesn't carry much weight when making an offer on a house. If you’re serious about purchasing a home, you’ll want to get fully pre-approved.
This is a far more in-depth process which includes:
Undergoing a detailed credit check
Submitting proof of employment with recent paystubs
Providing two years of filed tax returns
Providing two months of bank and asset account statements
While pre-approval is not an iron-clad guarantee that the lender will fund your purchase, it does demonstrate to sellers that you're a serious buyer who is likely to have the ability to obtain financing and close the deal.
Proof of Funds
Proof of funds refers to documentation proving your ability to cover the expenses associated with your purchase.
This would typically include your:
Earnest money deposit (EMD)
Down payment
For most first-time buyers, proof of funds will be a copy of a recent bank statement or a certified letter or balance statement from your financial institution. Investment account statements are also common proof of funds, particularly among cash buyers or those making a sizeable down payment.
How Long Does It Take to Make an Offer?
Found the perfect home and ready to move forward? An experienced buyer’s agent can often draft and submit an offer in a matter of hours – sometimes even faster – especially if they already have your pre-approval letter and proof of funds.
As a first-time buyer, particularly when submitting your very first offer, your agent will walk you through the intricacies of the offer, making sure that you fully understand all of the terms and conditions.
In a hot market, sellers might respond within a few hours. More commonly, you’ll hear back within one to three days.
If the seller is expecting or reviewing multiple offers, it might take even longer. Weekend delays or holidays can also slow down the process.
Your agent should remain in contact with the agent representing the seller, establish a timeframe of when you should expect a response, and keep you updated throughout.
What’s In the Offer?
First-time buyers often have a preconceived notion that making an offer on a house is just their agent telling the seller's agent how much they're willing to pay and that once a number is agreed upon, the rest of the details are worked out later. However, that's not the case.
Choosing the right price is just one part of an offer. Some of the other factors you’ll need to decide on include:
Contingency clauses
Closing date
Type of financing
Earnest money deposit
Along with the terms of your offer, your real estate agent will typically submit your mortgage pre-approval letter and proof of funds to show that you’re qualified and strengthen your position.
Some buyers even include a personal letter to the seller explaining why they want to purchase the home, although this practice may depend on your local market environment.
For example, in my experience, these are less influential in Manhattan, where sales are often more transactional. Yet, in Brooklyn's townhome market, a heartfelt letter can sometimes make all the difference.
How to Decide on Contingencies
Contingencies are clauses that outline scenarios in which you, the buyer, can cancel your purchase contract without forfeiting your earnest money deposit.
Some of the most common contingency clauses among first-time buyers are:
Home Inspection Contingency – This contingency gives you a specified amount of time to get an inspection from a qualified home inspector. If you're unhappy with the inspection results, such as the discovery of costly issues, you're entitled to back out of your purchase.
Financing Contingency – A financing contingency allows you to be refunded your earnest money deposit if you are ultimately unable to obtain a loan. Even with full pre-approval, financing can sometimes fall through during the underwriting process.
Appraisal Contingency – If the appraised value comes in low, this contingency gives you the right to either cancel your contract or negotiate a lower sales amount. Some types of financing, such as FHA and VA-backed loans, require an appraisal contingency.
Contingencies are important protections, especially for first-time buyers. However, in a competitive market, these clauses may make an offer less attractive. A good agent will help you balance risk and competitiveness when including and establishing the timeline for any contingencies.
Deciding on a Closing Date
The closing date is typically between 30 and 60 days after the offer is accepted. However, this timeframe can vary depending on the needs of both parties and whether the sale involves financing, condo/co-op board approval, or other unique requirements.
I let my buyers know that flexibility – especially around the seller’s ideal timing – can be a powerful negotiating tool.
However, underwriting a loan takes time. Be sure to speak with your mortgage company and verify that your proposed closing date is far enough in advance for them to provide the "clear to close" confirmation.
What’s Next If the Seller Accepts Your Offer
If the seller accepts your offer on their house, congratulations – you’re on your way to becoming a homeowner. But this is just the beginning of the process. There’s still plenty more that needs to happen between acceptance and the closing table.
Real estate laws vary by state, and standard practices may even differ by market. Depending on your location, the specific process from here may fluctuate.
In most cases, your offer will be made on a legally binding agreement. Once the seller accepts your terms and signs the purchase agreement you sent over, the property is officially "under contract."
In some locales, however, such as here in New York City, your initial offer sheet simply outlines the terms you're proposing. Once the seller accepts a buyer's offer, their attorney will draft a contract and send it to the buyer's attorney, who would review it with their client and typically return it signed within five to ten days.
The next step is to send over your earnest money deposit. Here, the EMD is generally wired to an escrow account maintained by the seller's attorney. However, in your area, you may also see deposits made by check and held in escrow by a real estate brokerage or title company.
At this point, you’ll also want to send the signed purchase agreement to your lender, who will schedule an appraisal of the home and move forward with the underwriting process.
What’s Next If the Seller Does Not Accept Your Offer
So, what if the seller does not accept your first offer? That doesn’t necessarily mean you’ve lost out on the home. When making an offer on a house, it’s common for sellers to counteroffer, especially if multiple prospective buyers are involved or they feel your terms need a slight adjustment.
If there’s no response or the seller outright rejects your offer, ask your agent to follow up for clarity.
This could mean that they’ve accepted a different offer. But it may also mean that they’re looking for a buyer with a different type of financing or don’t feel comfortable that you’ll be able to close on the purchase.
When the home is still available, buyers may choose to increase their offering price or adjust the other terms and contingencies of the deal. Sometimes, however, it’s better to move on and direct your focus to other properties.
Is It My Agent’s Fault if My Offer Is Rejected?
Most of the time, your real estate agent will be doing everything in their power to get your offer accepted. After all, they generally don’t get paid until you close on a home.
If one property doesn’t work out, your agent can help you find others that meet your requirements – sometimes even better.
Nationwide, the number of homes for sale is up 30% compared with the same period last year, according to the most recent data from ICE Mortgage Technology. This means that new properties are coming onto the market every single day, and it’s possible that having your first offer fall through could actually be a blessing in disguise.
However, occasionally an agent might delay submitting an offer, fail to communicate effectively with the seller’s agent, or advise you on terms that aren’t competitive. If this happens, it’s okay to re-evaluate your relationship with your real estate professional.
At the end of the day, you deserve someone in your corner who is responsive, strategic, and knowledgeable about the local market.
Some Final Advice for Making an Offer on a House
Ultimately, preparation is everything when making an offer on a house. This begins with getting pre-approved for a mortgage and ensuring that your buyer's agent has a copy of your pre-approval letter and documented proof of funds. But preparation doesn't end there.
You should also enter the buying process knowing your must-haves and deal-breakers when it comes to your perfect home. Not only will your agent be better able to guide you toward the properties that best fit your needs, but you'll also be more prepared to take action once you find the house that checks all of your boxes.
One more piece of advice that I give my homebuying clients: don't fall in love with a property until you're in contract. Offers fall through, and emotional resilience is part of being a successful buyer.
