How do I figure out what to offer?

Learn as much about market values as you can. Look at comparable properties. Ask your agent to prepare a comparative market evaluation of the property that will tell you recent selling prices of comparable properties. When market values are rising, there is a bit of guesswork involved in pricing. You may need to be a trendsetter and pay a bit more than recent comparable sales to be the successful bidder. Find out all you can about the property before writing an offer.

Get an estimated home value here.

Do sellers have to disclose the terms of other offers?

Sellers are not legally obligated to disclose the terms of other offers to prospective buyers.

How do I get the real scoop on homes I am looking at?

Home inspections, seller disclosure requirements and the agent's experience will help. Disclosure laws vary by state, but in some states, the law requires the seller to complete a real estate transfer disclosure statement.

Here is a summary of the things you could expect to see in a disclosure form:

• In the kitchen -- a range, oven, microwave, dishwasher, garbage disposal, trash compactor.
• Safety features such as burglar and fire alarms, smoke detectors, sprinklers, security gate, window screens and intercom.
• The presence of a TV antenna or satellite dish, carport or garage, automatic garage door opener, rain gutters, sump pump.
• Amenities such as a pool or spa, patio or deck, built-in barbeque and fireplaces.
• Type of heating, condition of electrical wiring, gas supply and presence of any external power source, such as solar panels.
• The type of water heater, water supply, sewer system or septic tank also should be disclosed.

Sellers also are required to indicate any significant defects or malfunctions existing in the home's major systems. A checklist specifies interior and exterior walls, ceilings, roof, insulation, windows, fences, driveway, sidewalks, floors, doors, foundation, as well as the electrical and plumbing systems. The form also asks sellers to note the presence of environmental hazards, walls or fences shared with adjoining landowners, any encroachments or easements, room additions or repairs made without the necessary permits or not in compliance with building codes, zoning violations, citations against the property and lawsuits against the seller affecting the property. Also look for, or ask about, settling, sliding or soil problems, flooding or drainage problems and any major damage resulting from earthquakes, floods or landslides. People buying a condominium must be told about covenants, codes and restrictions or other deed restrictions. It's important to note that the simple idea of disclosing defects has broadened significantly in recent years. Many jurisdictions have their own mandated disclosure forms as do many brokers and agents. Also, the home inspection and home warranty industries have grown significantly to accommodate increased demand from cautious buyers. Be sure to ask questions about anything that remains unclear or does not seem to be properly addressed by the forms provided to you.

What are the standard contingencies?

Most purchase offers include two standard contingencies: a financing contingency, which makes the sale dependent on the buyers' ability to obtain a loan commitment from a lender, and an inspection contingency, which allows buyers to have professionals inspect the property to their satisfaction. As a buyer, you could forfeit your deposit under certain circumstances, such as backing out of the deal for a reason not stipulated in the contract. The purchase contract must include the seller's responsibilities, such things as passing clear title, maintaining the property in its present condition until closing and making any agreed-upon repairs to the property.

What are some tips on negotiation?

There are several cardinal rules to negotiating effectively. One is do your homework, and learn as much about the property as you can. Another is to play your cards close to your vest and not reveal too much information to the other party or their agent. Don't let yourself get rushed into any decision, no matter how tempting it may be. Finally, if you have doubts about your negotiating skill, hire someone to help. The more you know about a seller's motivation, the stronger a negotiating position you are in. For example, a seller who must move quickly due to a job transfer may be amenable to a lower price with a speedy escrow. Other so-called "motivated sellers" include people going through a divorce or who have already purchased another home. Remember, that the listing price is what the seller would like to receive but is not necessarily what they will settle for. Before making an offer, check the recent sales prices of comparable homes in the neighborhood to see how the seller's asking price stacks up. Some experts discourage making deliberate low-ball offers. While such an offer can be presented, it can also sour the sale and discourage the seller from negotiating at all.

Is a low offer a good idea?

While your low offer in a normal market might be rejected immediately, in a buyer's market a motivated seller will either accept or make a counteroffer. Full-price offers or above are more likely to be accepted by the seller. But there are other considerations involved: Is the offer contingent upon anything, such as the sale of the buyer's current house? If so, a low offer, even at full price, may not be as attractive as an offer without that condition. Is the offer made on the house "as is", or does the buyer want the seller to make some repairs or lower the price instead? Is the offer all cash, meaning the buyer has waived the financing contingency? If so, then an offer at less than the asking price may be more attractive to the seller than a full-price offer with a financing contingency. You should always do your homework about comparable prices in the neighborhood before making any offer. It also pays to know something about the seller's motivation. A lower price with a speedy escrow, for example, may motivate a seller who must move, has another house under contract or must sell quickly for other reasons.

How do I handle the purchase offer when buying a for-sale-by-owner home?

If you do not have the expertise to draft a purchase contract, consider hiring a real estate attorney for this critical part of the transaction. If you are short on time and have little experience with real estate sales, you also can hire a real estate agent for an hourly rate or a fixed fee to represent you in the transaction. Some agents will handle such a transaction for a discounted fee because they will not have to spend time and money marketing the property or showing you the property.

Buyer / Agent Action Plan