Selling a home and a Buyer’s offer
Don’t make the mistake in thinking it’s only about the Price. Of course, price is at the top of your list but, don’t think it is the only thing to consider in a Buyer’s offer to purchase your home.
So what makes for a good Buyer’s offer when selling your home?
Consider these criteria in determing the value of an offer:
- Buyer’s Escrow deposit. Anything less than 1% of the purchase price is a weak offer generally, and as the deposit increases above 1%, with each percentage point increase making for a Buyer’s offer to stand out from the pack.
- Buyer’s Pre Approval, if financing and not paying cash. Has the Buyer provided a Pre Approval letter and not simply a Pre qualification letter. A Pre qualification is about as valuable, as the paper that it is printed on. You’ll want the Buyer’s Lender to have reviewed the Buyers credit, income and assets. A report indicating that their numbers have been run through some type of a Desktop Underwriting (DU) system can also be beneficial yet, keep in mind it’s only as good as the numbers added to the automated generated report so it’s not fool proof. Knowing that a DU was run and the Buyers’ credit, income and assets have been reviewed can give you the best indication of success for this Buyer ultimately gaining final loan commitment. Again, it’s important to understand however, that this still does not guarantee the Buyer will secure financing; it simply provides the best in knowing the qualifications of the Buyer.
- Buyer’s Loan Commitment. Most Real Estate Purchase Contracts will allow for the Buyer’s loan commitment to be provided in 30 days. Depending upon what contract is being used, the time periods can be calculated in calendar days or business days so pay attention to that. I will recommend my Sellers to look for a commitment being offered of at least 15 days (business days) or 20 days (calendar days) which is more than enough time to gain commitment. You don’t want to allow for 30 days to find out that the Buyer’s Lender has committed to Buyer as that would put you likely right on top of the closing date. The sooner you can find out about a Buyer’s inability to gain financing the better, in case you then have to go out and get a new Buyer with having to waste the least amount of your time. (When I’m representing Buyers, I will recommend for a quick commitment turn around period also in order to put my Buyer’s offer at the front of the pack)
- Inspections. Most Real Estate purchase contracts will allow for up to 10 days to complete an inspection once you have an executed contract. (An executed contract is when the last party to the contract has made the last initial and/or signature and delivered to other party) I always recommend to my Sellers that they look for a quick inspection time within 5-7 days or sooner, if possible. (When I’m representing Buyers, I also recommend that they get the inspections done fast as I know it will make my Buyers offer look appealing.)
- Who is the Buyer? Do you know anything about the Buyer? Sometimes, knowing who is buying your home can make a difference in who you would love to see living in your home, after you’ve moved out. Sometimes, you’ll find Buyer’s Agents sending over a letter or email describing the Buyer to you, in hopes of it pulling at your heart strings.
Remember these tips when you get ready to sell your home. Looking for some other good home selling tips? Feel free to contact me and we can discuss selling your home.