How Do You Make an Offer on a House With Confidence

Many new investors freeze when it is time to make an offer on a property. We reviewed guidance from experienced investors, studied real-world processes, and pulled lessons from conversations like our interview with Khang Lee on the DealMachine REI Podcast. From that research, we created a clear checklist that helps you move from hesitation to confident action.

If you have been driving for dollars, walking distressed properties, or browsing off-market lists, you might already have a property in mind. The next step is learning how to structure your offer so it feels solid and competitive, even if you are new to the field.

This guide walks you through a simple, repeatable process designed for new investors who want to take the fear out of making their first offer.

12-Point Checklist for Structuring a Confident Offer on a Distressed Property

This checklist helps you handle the pricing, paperwork, and seller communication that go into a strong offer. It also explains how investors use tools like DealMachine to organize leads, estimate repairs, and track conversations with property owners.

Each section includes short steps you can act on right away.

1. Identify the Property and Confirm Seller Details

Before thinking about price, confirm the basics. Make sure you know who owns the property and how to reach them. Many new investors skip this and end up calling the wrong person or assuming details that are not accurate.

Steps:

• Confirm ownership through county records or by leveraging DealMachine’s skip tracing functionality.
• Make sure the mailing address for the owner is correct.
• Start a basic lead profile in DealMachine or your CRM.

Takeaway: You want clean information before you run numbers or ask a seller questions.

2. Estimate the ARV

After Repair Value (ARV) is the expected price of the property after repairs. You do not need perfect accuracy. You only need a solid range based on similar renovated homes.

Steps:

• Look for updated homes within a close radius.
• Study photos so you understand the level of upgrades used.
• Use multiple sources to confirm the range.

Many experienced investors use tools inside DealMachine to study comps quickly before talking to the seller.

Takeaway: A clear ARV helps you avoid guessing when you build your offer.

3. Estimate Repair Costs With a Simple System

You do not need contractor-level knowledge to estimate repairs. Most beginners use a simple checklist that covers common items seen in distressed homes.

Steps:

• Walk the exterior and check the roof, siding, windows, and foundation.
• Look inside for flooring issues, kitchen age, bathroom age, and mechanicals.
• Use a basic per-square-foot repair estimate as a starting point.

Studies in property management show that repair planning works best when investors follow the same steps each time. A repeatable approach matters more than perfect precision.

Takeaway: Your estimate does not need to be exact. It only needs to be consistent.

4. Calculate Your Maximum Acceptable Offer (MAO)

MAO is the highest number you can offer while still protecting your profit. This number keeps your emotions out of the negotiation.

Formula:

• Start with ARV.
• Subtract repair costs.
• Subtract your target profit or assignment fee.
• Subtract holding and transaction costs if you plan to close on the property.

Many investors build a MAO calculator into their daily workflow. DealMachine users often track their target numbers alongside each property so the MAO is easy to reference when talking with sellers.

Takeaway: MAO protects you from overpaying and gives you confidence during negotiation.

5. Select Your Financing Method

How you fund the deal affects the strength of your offer. You can structure offers with different financing options, each with different timelines and expectations.

Common paths:

• Hard money
• Conventional loans
• Private lenders or partners

Each lender type has different requirements for property condition, appraisal needs, and closing time. Studies of real estate lending show that distressed property buyers often rely on private financing to increase speed, which matters to motivated sellers.

Takeaway: Tell the seller clearly how you plan to fund the deal so they understand your timeline.

6. Build Your Offer Price Range

Do not lock into one number too early. Create a range that includes:

• Your ideal price
• Your maximum acceptable price
• A comfortable starting point

This makes negotiation smoother and helps you stay calm if the seller pushes back.

Takeaway: A price range gives you room to adjust while staying within your limits.

7. Decide Your Contingencies

Distressed properties often sell faster when the buyer uses fewer contingencies. New investors can stay safe by using simple, clear language rather than stacking on many protections that slow the deal down.

Common choices:

• Inspection contingency
• Title contingency
• Finance contingency

Studies from real estate law groups show that using a short and simple contingency list reduces seller friction and speeds up contract review.

Takeaway: Keep your contingencies clear and straightforward.

8. Choose Your Earnest Money Amount

Earnest money signals seriousness. Even a modest amount builds trust when paired with a clean contract. Choose a number that feels meaningful but does not strain your budget.

Takeaway: Earnest money is more about confidence than size.

9. Set Your Closing Timeline

Most sellers with distressed homes want a fast and simple closing. Your financing method determines how quickly you can close. Make sure the date you choose is achievable.

Takeaway: A realistic closing date helps you stand out without creating pressure you cannot meet.

10. Prepare a Simple, Clear Contract

Use a standard purchase agreement for your state. Keep the language readable. Always include a reminder that you are not offering legal advice. Studies from legal education groups show that clear contracts lower the chances of confusion for both parties.

Your contract should include:

• Property address
• Offer price
• Earnest money
• Closing date
• Contingencies
• Signatures

Takeaway: A clean contract builds seller trust instantly.

11. Practice the Conversation With the Seller

Even new investors sound confident when they practice their script. You can rehearse the basics:

• How you introduce yourself
• How you explain your offer
• How you ask follow-up questions

DealMachine users often keep notes about seller communication inside the app so they stay organized during calls.

Takeaway: Preparation creates confidence, even if this is your first offer.

12. Deliver the Offer Calmly and Clearly

Your tone matters more than your experience. Slow down, speak simply, and give the seller time to process the information. Many new investors report better results when they avoid pressure and focus on clarity.

Takeaway: Clarity builds trust. Trust leads to smoother negotiations.

Key Takeaways

You can make a confident offer on a distressed property when you follow a simple, proven process. You do not need years of experience to sound prepared. You only need a clear MAO, a clean contract, and a step-by-step plan.

Tools like DealMachine make the process easier by helping you estimate repairs, study comps, track seller conversations, and stay organized through the entire offer process.

If you stay consistent, your confidence grows quickly, and your offers become stronger each week.

Frequently Asked Questions

How do I know if my offer is too low?

If your offer matches your MAO calculations, it is not too low. Sellers often start higher, but your numbers guide you to a price that protects your profit.

Do I need an inspection on a distressed property?

An inspection is helpful, but some investors skip it when buying cash. Use your repair checklist to understand risks and decide if you want this extra step.

What if the seller rejects my offer?

Rejection is normal. Ask the seller what matters most to them. Sometimes small adjustments in closing speed or earnest money help.

Can I make an offer without a real estate agent?

Yes. Many investors purchase distressed properties off-market. Still, follow state contract rules and seek professional guidance when needed.