The nation’s real estate markets are still leaning toward sellers. Multiple offers on attractive, reasonably priced homes are common in many areas.
It only makes sense then that the higher the offering price, the better the offer, right? For many sellers, yes, but it isn’t always the case. Let us explain. Sometimes the highest offer may have the worst terms, so it pays to scrutinize the entire contract before deciding on which offer to choose. Here are some things to keep in mind.
BUYER FINANCING
The buyer’s funding is an important consideration. Most sellers prefer a buyer who is offering to pay cash for their homes, at least in markets that favor them. Also, a sizeable down payment is attractive and lowers the borrower’s loan amount, making it more likely they will qualify for a loan.
FHA LOANS
FHA-backed loans have a more stringent appraisal process than a conventional loan, so if there are possible issues with their home, many homeowners put any offers using FHA financing at the bottom of the pile.
EARNEST MONEY
How much earnest money is each bidder depositing? The amount can vary, and the buyer with the highest earnest money deposit has the most “skin” in the game and is less likely to bail on the deal.
CONTINGENT OFFERS
Some offers are contingent upon the sale of the buyers’ current home. When determining the value of contingent offers, keep in mind more variables need to be met for the deal to come to fruition. Therefore, their value should be measured accordingly.
THE BOTTOM LINE
Buyer offers can be deceiving, and having the right assistance to ensure you are excepting the best offer while avoiding possible pitfalls is crucial. The above list is just an overview of what we can look at in the purchase contracts you receive. Feel free to contact a Martino Realty Group agent at charles@martino-realty.com for all your real estate questions and needs.
