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After you settle on a price - and maybe you and the seller have agreed verbally on that price - you're ready to write up an offer to present to the seller. But you need to include more than just a price in your purchase offer. You also want to include conditions, called contingencies, that you're attaching to the offer, along with earnest money to show that you're serious about buying the home.
Purchase offers work differently in different parts of the country. In some states, your purchase offer is exactly that - an offer to purchase a home. In these states, you submit a purchase offer as a first step and then, if the seller accepts your offer, you write and sign a purchase-and-sale agreement (often called just a purchase agreement) that spells out your and the seller's conditions and expectations in greater detail. In other states, your purchase offer is the purchase-and-sale agreement, as long as the seller agrees to its terms, so you need to make sure it's complete.
Purchase offers and purchase-and-sale agreements are legally binding documents. In some states, a qualified attorney has to draw up these papers. If you don't live in one of those states, it's still a good idea to have a real estate attorney review your purchase offer (and also the purchase-and-sale agreement, if that's a separate document) before you sign on the dotted line.
