How to Evaluate an Offer on Your Westside LA Home: What the Numbers and Terms Actually Mean

The offer comes in. The first number you see is the purchase price. That number matters, but it is not the only thing that matters. An offer with a strong price and weak terms can cost you more than an offer with a lower price and a clean structure.

Here is how to read what is actually in front of you.

The earnest money deposit, often called the EMD, is the buyer's good-faith payment made at the time of contract. In California, it typically runs 1 to 3 percent of the purchase price, though it can be higher in competitive situations.

The deposit signals how committed the buyer is. A higher deposit from a buyer with strong financing is a positive indicator. A low deposit paired with a long list of contingencies is worth noting.

If the buyer defaults after all contingencies have been removed and both sides initialed the liquidated damages clause, the seller can generally keep the deposit. When the buyer intends to live in a one-to-four-unit home, California caps that amount at 3 percent of the purchase price. That protection is only as strong as the deposit amount and the contingency structure, which brings us to the next item.

A contingency is a condition that gives the buyer the right to investigate something and cancel the contract without penalty if the condition is not met. Three contingencies appear on most California residential offers.

Inspection contingency. The buyer has a set number of days to inspect the home and report any concerns. If the inspection reveals something they cannot accept, they can request repairs, ask for a price reduction, or walk away. This is standard on nearly every offer. For what sellers should expect during the inspection process, see What to Expect at the Home Inspection When Selling in Westside Los Angeles.

Financing contingency. The buyer has a set number of days to secure a loan. If they cannot get approved, they can cancel and keep their deposit. Cash buyers have no financing contingency. A buyer with a solid pre-approval from a reputable lender is a more reliable close than a buyer with a generic pre-qualification letter from an online service nobody can verify.

Appraisal contingency. If the home does not appraise at the agreed purchase price, the buyer can renegotiate or cancel. In competitive situations, some buyers waive this contingency, meaning they will cover any gap between the appraised value and the purchase price out of their own pocket. That removes the risk of a price reduction due to a low appraisal, which matters to sellers who are counting on hitting their number.

California closings typically run 21 to 45 days from contract acceptance to the closing date. The timeline in the offer affects whether the deal fits your situation.

A faster close may work better if you need to move quickly, have already lined up your next home, or want the transaction behind you. A longer close may give you more time to coordinate a move or handle logistics on your end. Neither is automatically better. It depends on where you are going and when you need to be there.

California real estate contracts specify which items stay with the home and which the seller keeps. Fixtures and built-in appliances typically convey with the home by default. Portable items, such as a refrigerator, washer, dryer, or a specific light fixture you want to take, may be included or excluded depending on what the buyer asked for and what you agreed to.

Read this section carefully. If a buyer is asking for something you planned to take, or excluding something you assumed would stay, this is the time to address it, not after you have moved.

The purchase price only matters if the buyer can close at that price. Before you respond, look at the financing behind the offer.

A conventional loan with 20 percent down from a buyer whose lender you can call is different from a financing offer with a low down payment and a lender nobody has heard of. Both can close, but the path to closing is different and the risk profile is different.

A cash offer removes both the financing contingency and the appraisal contingency entirely. That simplicity has real value, especially in a transaction where you need certainty, even if the cash price comes in slightly below a financed offer.

When two or more offers are on the table, price alone is not the right lens. Look at the full picture: price, deposit amount, contingency structure, closing timeline, and the buyer's financing strength.

A lower all-cash offer with no contingencies and a 21-day close can net you more than a higher financed offer with a long contingency period, a 45-day close, and an unknown lender. The right question is not which offer is highest. The right question is which offer is most likely to close at the agreed terms on the agreed timeline.

For a deeper look at managing a competitive offer situation, see How to Handle Multiple Offers on Your Westside Los Angeles Home.

Once you accept an offer, the contingency periods begin. The buyer conducts inspections, secures financing, and works toward removing contingencies by the agreed deadlines. Your job during this phase is keeping the home accessible, responding to any inspection requests promptly, and staying in touch with me about where things stand.

For a full walkthrough of what follows acceptance, see What Happens After You Accept an Offer on Your Westside LA Home. And when you are ready to understand what you will actually put in your pocket from the sale, read How to Read Your Net Sheet When Selling Your Westside LA Home.

I walk every seller through the offer line by line before we respond. You should understand every number and every term before you sign. No pressure, just real answers.

An offer is a stack of terms, not just a price. If you have one in hand, or expect one soon, send me a note and we will go through it together. First Key Pacific walks every seller through the terms before anyone signs.