You’ve worked hard to get your home ready for sale and to price it properly. With any luck, offers will come quickly, and maybe even multiple offers! You’ll need to review each offer carefully to determine its strengths and drawbacks and pick one to accept. It sounds like fun, but choosing the best offer when you receive multiple can be a challenge. Here are six tips for evaluating offers for a smooth transaction.
1. Understand the process
All offers are negotiable, as your Atlanta real estate agent will tell you. When you receive an offer, you can accept it, reject it, or respond by asking that terms be modified, which is called making a counteroffer. You aren’t required to respond to every offer (although we recommend you do, out of common courtesy). In addition, any Acceptance Deadlines are only applicable if you will be accepting that offer as written. If you will be rejecting or countering an offer, that deadline is meaningless so don’t stress about it. If you accept the offer as is, the offer will be binding at that point. If you counter the offer and the buyer accepts the counter with no changes, the offer will be binding at that point.
2. Review all offer terms
Decide in advance what terms are most important to you. Carefully evaluate all the terms in each offer. If you are a client of Catalyst Home Team, we’ll have a spreadsheet already set up for you to easily review each term of all offers. Each offer will have it’s pros and cons. Narrow your possibilities to those that satisfy the most important aspects of your move.
Price is important, but so are the other terms. Is the buyer asking for appliances, or window treatments to be included in the sale that you had your heart set on taking with you?
Is the amount of earnest money the buyer proposes to deposit toward the downpayment sufficient? The higher the earnest money, the more painful it will be for the buyer to forfeit those funds by walking away from the purchase if problems arise down the line.
Have the buyers included a pre-approval letter with their offer? This means the lender *should* have verified the buyer’s income & assets (through a copy of their bank statements, paystubs, and tax returns), received a full credit report, and ideally sent the buyer’s file to their underwriter for review. Before we present any offer to our sellers, Catalyst Home Team Realtors call the buyer’s lender to discuss the buyer’s ability to qualify for a loan.
Is the buyer asking you to make concessions, like covering some closing costs? Are you willing to contribute towards closing costs, is it standard for your neighborhood, and are you able to afford that?
Does the buyer’s proposed closing date mesh with your timeline? If not, even if all other terms are acceptable to you, consider countering the close date.
With each term you are reviewing, ask yourself if this is a deal breaker, or if you can compromise that term in order to achieve your ultimate goal of closing on the sale of your home. Remember also, the key to successfully negotiating the sale is to remain flexible.
3. If an offer is non-contingent, VERIFY
If it seems too good to be true, it may be. Even if one of the offers received is not contingent on that buyer’s home selling first, ensure your real estate agent verifies if the buyer has a home to sell with the buyer’s agent before accepting that offer. Even if it’s not contingent, if they do have a home to sell and the contract they have on that home falls apart, yours may also. More than one seller and their agent have been misled by this fact.
Likewise, if the offer is contingent on a sale, ensure your agent has requested a copy of the contingent offer. We always verify that buyer’s ability to qualify. We check on the progress of that sale also. Have inspections been completed? Have their been any red? Has the appraisal been completed yet? Did it come it at contract value?
4. Prevent the buyer from renegotiating the price
Clever agents will offer you the moon but keep the appraisal contingency. When the house does not appraise, they will ask for the price to be reduced to the appraised value.
If you run a bidding war correctly, you will get a buyer to pay over market value because they will get carried away with winning the auction.
To keep the high price,, the first step is to remove the contingency of the appraisal. The finishing step is to have the buyer show you proof that they have enough cash to bring to closing to make up the difference between the amount of the loan and the purchase price should your home not appraise at the higher price.
5. Treat everyone fairly
Selling your home can be emotional. But it’s simply a business transaction, and you should treat it that way. Negotiate in kind. According to a recent study by the National Association of Realtors, 1 in 4 contracts falls apart. Transactions fall apart, and you may be re-visiting these offers for a backup if things don’t work out with the original offer.
6. Check the professionalism of the buyer’s agent
Ask your agent about their experience so far with each buyer’s agent. When our sellers are going over the quality of the offers, I review the quality of the agents representing each buyer. If we have worked with an agent before, and they professionally closed the sale gracefully, that is information the seller should know.
If the agent has minimal ability as shown by things like he or she had a hard time complying with the instructions on how to submit the offer, the seller should know that also.
Talented agents typically have better lenders, better inspectors and have the ability to select better buyers to represent. If the offers are anywhere close, we always recommend our sellers choose the one with the best agent.
For more assistance in selling your home for the most money in the least amount of time, or for help in negotiating through multiple offers in Atlanta Georgia, reach out to Catalyst Home Team today!