When you receive an offer, make sure it is presented in a legally approved contract and the offer price is close to your comps. The offer should have reasonable loan terms, like interest rates and origination fees, and it should feature feasible time frames.
- Accepting Offer. If you agree with all of the buyer's terms, then simply sign the offer and it becomes a ratified contract. Offers you receive may contain contingencies, which are features of the buyer's proposal that allows them to retract their offer if a specified future event does not occur. Typically, contingencies relate to appraisal, home inspection, and mortgage approval. For example, if a buyer does not approve the home inspection report when it happens in the future, then they can use a contingency to back out of their offer.
- Counter Offer. A counter offer is a way to accept the buyer's offer with some modifications. For instance, you can ask for a higher price, to have some contingencies removed, or adjust the time frames they proposed. This tends to be a much simpler contract than the original offer, and is usually only one page.
- Multiple Offers. If you have the good fortune of receiving multiple offers, your dilemma is in selecting the best offer. Remember that while getting top dollar is important, an offer with a slightly lower price but less contingencies may ultimately be the better choice.
Get your buyer pre-approved. Make sure your borrower is qualified and alleviate the risk of your buyer falling out of Escrow by having them preapproved for their home loan.
Got possible buyers?
Get them preapproved!
Got possible buyers?
Preapprove Your Buyers
Get them preapproved!
For the next 30–60 days, you will be:
- Processing paperwork
- Scheduling appointments for inspections and any repairs
- Checking in with your mortgage company and the buyers, to make sure all parties have what they need to close
- You will want your attorney to review all of the documents
Engage an Attorney
Real estate laws differ—as do closing requirements—across the country, which is why it's a good idea to have an expert on hand to keep your transaction compliant.
Few buyers will make the leap without negotiating. Know where you can compromise in advance, and then get ready to find the middle ground. This approach will get your deal done. After that, it's a matter of paperwork.
Negotiation Tips and Best Practices
- The first offer could be the best. The first offer can be a good assessment of your market value. Though, there are some buyers who will start very low hoping you are in a hurry to sell. When an offer is too low, you have the option of not countering, but instead asking them to resubmit. You may even decide to reject low ball offers.
- Consider conceding before countering. Often, offers come with concessions, like a request for a delayed closing, for instance. When an offering price is close to your listing price, you may want to accept a concession instead of immediately lowering your price.
- Be a listener, not a talker. The less buyers know about your circumstances and reasons for selling, the better. Additionally, the more you know about the buyer's circumstances, the more leverage you have in a negotiation.
- Know your limits. Before you list, determine your minimum sales price. Then, ask yourself how long you are willing and can afford to have your home on the market. You may come out money ahead by selling at a lower price due to your carrying costs, especially if you have already moved.
- Know your facts. Create a history of upgrades you've made since you bought the home, the age of appliances, and how much it would cost to replace them. You may want to consider offering a home warranty to counteract any reluctance on a buyer's part. This relatively inexpensive insurance covers repair costs should something break down within the first year of you selling the home.
- Follow the money. Understand the lending conditions your buyer is working with. That can help you determine whether you want to agree to a lower price to help them qualify for their mortgage in exchange for a larger participation from them in the closing costs, for example.
- Set aide your emotions. Try to conduct the sale of your home from an objective standpoint. Put your self in the buyer's position.
- Face-to-face. It's usually best to conduct negotiations in person rather than over the phone, by text, or by email.
- Get it in writing. Make sure everything is down on paper, verbal agreements won't due in legal contracts.