Money Isn’t The Most Important Part Of An Offer: These 5 Things Are

Dated: May 4 2022

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Money Isn't The Most Important Part Of An Offer:These 5 Things Are Blog Header

By O’Brien Realty

 

Although price is important, sellers must consider these 5 things before choosing an offer.

 

Accepting an offer is the most exciting (and stressful) point in the home selling process. This is especially true in today’s seller’s market, where the record-high demand is creating some crazy competition. This is great for you, since you will get the best price for your home, but it also brings a lot of stress since you have to sort through so many offers to find the best one.

 

So how do you know if you are getting the best offer? Most people think that a seller should just go with the offer with the most money, but this isn’t usually the best. Although it is easy to get distracted by all of the checks (or even cash) that people are waving in your face, there are plenty of more important factors that you need to consider before you accept an offer.

 

Your Sale Priorities  

First of all, you’ll want to pick the offer that best aligns with your sale priorities. People sell their homes for different reasons, and what might be best for your neighbors who sold their home down the street, isn’t necessarily what’s best for you. Those who are facing a divorce or job relocation will be more interested in a speedy sale, but if you are facing financial hardships you may need to select an offer that doesn’t require a lot of costly repairs, a cash offer, or a higher offer. It’s important to keep your goals in mind and discuss them with your agent while evaluating offers.

 

Contingencies

Yes, the price is great! But what exactly are the buyers asking you to do? Consider the contingencies that the buyers have written in their offer to determine if this offer really is the best deal for you. Contingencies have the potential to delay the sale, cost you thousands in repairs, allow the buyers to back out of sale, or bring up some other deal breakers. Here are a few examples.

-Appraisal Contingency: the house must be appraised so the bank will fund the whole loan for the buyers. This means that your buyers will be verified financially, but the sale may take longer or even fall through if the bank refuses.

- Sale Contingency: your home will sell when (or if) the buyer’s current home also sells. Because of this, your buyers may be able to offer more money, but they could also back out of your sale.

-Inspection: the home will be inspected to protect the buyers from any potential major defects before closing. However, this can significantly delay the sale, potentially impact the value of your home, or give the buyers reasons to back out.

 

In this highly competitive market, we have seen some buyers start to waive contingencies, but doing so can come with risks. 

 

Financing

Before you start looking at your offers, start considering what financing options would align best with your selling goals and preferences. Each option brings some pros and cons for buyers and sellers.

-Financing: Your buyer will need a strong pre-qualification letter or be pre-approved (here’s the difference)

-Cash: Your buyers will need to verify that they have enough cash. This option is the fastest, requires less processing, and is significantly less complicated as it waives the appraisal contingency. However, due to all of these benefits, you will probably see a lower offer.

-Loans: These will require an appraisal contingency, but your buyers will be verified to make their purchase. However, this option takes longer and need more paperwork than the other two.

 

Earnest Money

For sellers, Earnest Money is a win-win! Buyers designate an amount of money to cover costs and demonstrate that they are serious about buying your home. Plus, if they decide to back out of the sale, the seller keeps that money! When the buyer puts more earnest money down, it shows they are committed to the home, and in a good financial standing. Committed, financially able, and the chance to keep that money are all big draws for the seller.

 

Closing Time

“I know who I want to take my home”-ok, so those aren’t really the lyrics, but they still apply. Once you’ve found the right buyer for your home, you have to make sure that the closing timeline also works for you. If your home is already empty, you need the money sooner rather than later, or you need to sell the home quickly, you will need to select a buyer that can help you make a quick sale, possibly with a higher offer. However, if you are in the process of finding your next home, or need some time to move, you might want to look at some offers that will give you the extra time you need. 

 

Although the offers with the most money are the most appealing initially, the highest bid may not necessarily be your best option. That’s why in this highly competitive market, it is important to have the right agent who is familiar with multiple-bid offers and can help you determine which offer is best for you. So if you are looking for Southern Maryland real estate, come see what The Best Of Southern Maryland has to offer! 

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