competitive offers

IN GENERAL

MORE THAN MONEY

In ANY market (Buyers or Sellers) it’s important to have an understanding of what makes a competitive offer, that is – OTHER than price! More often than not, price wins. But sometimes it doesn’t! Like you, the seller(s) certainly have their own motivating factors. Who doesn’t?
LAYING THE FOUNDATION

THE BASE

Before you start crafting your offer, we have to lay the groundwork. Your Realtor will provide you important information about the seller to get a better gauge on what is important (and what is not important) to the seller. Here are some important questions that your Realtor will discover, before you write your offer: 

Did the sellers recently purchase the home? 

Have the current owners lived in their home or are they investors

How quickly do the sellers want to close

Are the sellers in a financial hardship

Why are they selling? 

Where are they moving? 

When do the sellers prefer to close ie. transfer ownership? 

Is the home in a Will or Living Trust

Have the sellers had any recent bad experiences with selling? If so, decipher what components would make them more confident with your offer?

KEY COMPONENTS

TO OFFERING

1. Type of Financing – You know what they say “cash is king” but why? Why would a cash offer, win over an offer that is financed ie. Buyer has to get a loan? The number one reason why homes don’t sell, after being in contract is the buyers inability to obtain financing to purchase. For that reason, most sellers are impartial to Cash and find great comfort in not having to deal with a bank. 

What if you don’t have a pile a cash lying around? Take the extra step and get approved with a lender who can provide you a Guaranteed Approval! When you have this one thing, you will out compete other like offers. Many of these lender guarantees come with a promise to reimburse both buyer and seller up to $5,000 if they are unable to close. 

2. Close date – Time is money baby. If the seller prefers to close as soon as possible, the winning offer may (on paper) be less than the highest priced offer. But in actuality closing earlier could save the seller hundreds if not thousands of dollars in taxes, insurance and mortgage payment.

3. Earnest Money – Put some skin in the game. Earnest Money conveys to the sellers that you are making a Good Faith Offer. That is, you aren’t simply going to walk a day before closing because you got cold feet. Putting as much as 3% earnest money (3% of the purchase price that is)  in a competitive environment, is sometimes warranted to get your offer in the winning seat. 

4. Home Inspection – Have one. Yes. You heard me. Have one. If you don’t have extensive house knowledge, it’s not advised to purchase a home without hiring a professional to get into your crawl space, attic, scope your sewer line or septic and dig into every nook and cranny before going all in. 

You can however, perform a pre-inspection ie. do a home inspection before your offer is accepted. If you do this and are satisfied with the condition of the home, you can check the box that you’re inspection is already conducted. This allows you to compete again home buyers who are waiving their life away. 🙂 

Include a clause in your contract that states your Inspection is for Informational purposes only. It’s not advised you include this in the purchase and sale without the review of an attorney. This modification help compete again other home buyers who are choosing to waive their inspection. 

5. Professionalism & Reputation – Work with a local expert. It pays to hire a Professional Realtor who knows the market, the other working professionals and has the resources to offer you when you need them.

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