These days multiple offers on houses that are for sale are fairly common. When choosing an offer it isn’t just about the amount of money being offered. Here are a few things that matter to sellers when they evaluate offers:
- The total dollar amount of offer.
- Down payment percentage. The greater the down payment the better but that doesn’t mean buyers need a huge down payment to buy a house. It just means that if all things are equal an offer with a 10% down payment is better than an offer with a 5% down payment.
- Closing date. Usually, closing dates can be negotiated but buyers should ask their agent to find out what the sellers have in mind for a closing date.
- Length of the inspection period. A shorter inspection period is better than a longer one.
- Earnest money matters, it shows that the buyer has money and it also shows the strength of the buyer’s commitment to buy the home.
- An offer written by a real estate agent with a good reputation. An agent’s reputation is based on how she works with her clients and with other agents. The agent with the most sales isn’t necessarily the agent with the best reputation.
- Offers that are not contingent upon the sale of another property are better than contingent offers.
- Asking the seller to pay the buyers closing costs weakens the offer.
These days speed is important. When the right house comes on the market buyers need to drop what they are doing, see the property and make an offer. Unfortunately, those who wait for the weekend or for an open house end up missing out.
Pro buyer tip: If you are at an open house and you think you want to make an offer on the house act as disinterested as possible around other open house attendees and be very careful about what you say in front of the real estate agent who is hosting the open house because he/she is representing the seller and anything you say can be held against you and it can weaken your negotiating power.
It is also important to have that pre-approval letter from a lender ready before looking at houses. If there are multiple offers the seller isn’t going to wait for a pre-approval letter and an offer isn’t any good without one.
Happy house hunting and may the odds be forever in your favor.