Multiple Offers: Getting the Seller to Accept Your Offer
What are some ways a homebuyer can secure their offer besides simply offering the highest price? To start, price is most important – and it’s the consumer that drives it! Before you make your decision, make certain that you’re clear on what the value of the home is to you.
Sometimes it’s not just the market value, but the added value that the home will provide for you if you’re successful in purchasing it.
Will this home save you money on your commute time? Is it closer to your associations and/or family? Is it in the ideal school district for your needs?
Decide on your five-year plan
If you’re also considering the resale value of the home five years from now, how will the home and neighborhood look to a potential buyer at that time?
What are some other items and plans that you have for your future that are out of sight for now? Are you planning for children (extra rooms), or for recreational equipment and vehicles (extra garage space), or both? Could you make do in this home if your five year plan changes, and you will be staying in the home longer?
If the home is undervalued or overvalued
Does the home appear to be listed at a lower-than-market value? Are there other agents looking at the home with their clients? If the answer is yes, you may want to be proactive and add an escalation clause or simply offer a higher value in your offer price.
If you and your agent determine that the home is overvalued but you still want the home, you may want to make an offer that reflects the true market value for the home. Include a letter stating the reason(s) for the lower offer, such as:
- Market analysis suggests such and such a price,
- The home will not likely appraise for the current list value
Find out the seller’s needs
Try to find out what the seller’s needs are besides simply selling the home. Do they need more time in the home after closing to help with their needs? Do they have any unusual requests or needs that you would be more than happy to help with?
Find out when would be the ideal closing date for the sellers, as long as it still meets your needs. Have your agent go on a fact-finding mission, and be willing to compromise with the seller on similar issues to this to help secure your offer and facilitate the sale.
Purchase agreement contingencies
If you have contingencies with your offer, make them simple and concise. If your offer appears to be long-winded in requirements, ask yourself “If I were the seller, would I feel comfortable signing this offer?”
It’s commonplace to be subject to financing, inspections, and feasibilities, and you commonly have a 10-day window to do your “due diligence” already written into the first few pages of your offer – so don’t be redundant and ask for additional contingency pages that add to the confusion if your interests are already covered.
Tips to make your real estate offer stand out
And speaking of simple and concise, take the time to have your offer typed instead of handwritten. Include an intro letter that is not necessarily personal, but a bit of background that conveys viability and low risk to the seller.
Your offer submitted to the seller should contain the following:
- Signed intro letter
- Purchase agreement
- Pre-approval letter
- Copy of last recorded deed or legal description of the subject property with your signature
- Signed receipt of the sellers’ disclosure statement.
When dealing with earnest money, it’s best to offer 1% of the purchase value on a personal check, payable to the closing (escrow) agent. If you use promissory notes for your earnest money, it makes your offer look weak. If you have an option of using your agent’s firm to deposit the earnest money or the escrow company, choose the escrow company.
First impressions as a buyer
Impressions will always have their significance, and it’s no different when it comes to the business of real estate. When you’re out searching for homes, be mindful of your appearance.
What kind of impression do you think the seller would have of you if he saw you while you were viewing his or her home? Would the seller be comfortable entertaining an offer from you after what they may have witnessed from across the street while they were spying on you?
If you found a great home, and you were competing with one other offer that was basically the same on paper, would the seller’s impression of you be enough to give you the edge?
You’ve got an accepted offer. Now what?
So you’ve secured your offer on the home. However, you’ve been warned that the seller has a backup offer, and will “not likely” be inclined to make any repairs. Don’t let this situation deter you from making sure your needs and goals are taken care of.
There’s a reason why you’re in the market to buy a home, and nobody understands that better than you do. Do your due diligence and make sure that the home is going to work for you. Ask for concessions that are reasonable if needed, and stick to your guns – the seller’s false sense of security could easily change at the drop of a hat.