Selling Your Home and You Have Received Competing Offers? Remember, Price Isn’t Everything
If you’re selling your home, you might be lucky enough to receive more than one offer. If so, it’s a good idea to let potential buyers know. That way, they can tailor their offer with the competition in mind.You’ll then need to evaluate each offer fairly and consider advice from your real estate agent to choose the best one. Here are strategies to reach a decision:
Start with price but don’t end there
The offer with the highest price is going to get your attention, especially if it’s close to or above your asking price. But that doesn’t mean you should automatically hand over the keys to the highest bidder. Those offering the most money might be stretching their finances and run into trouble at the closing table. For example, they may not get approved for a big enough mortgage to buy the house at the agreed price.
In some cases, the Mortgage Lender may ask for a Home Appraisal. This could cause the Lender to deny the amount of the Mortgage being requested if the sale price doesn’t match the appraisal amount. Inquire if the Buyer is willing to spend his own money to honor the original purchase price, even if the appraisal is unexpectedly low, that offer may be more attractive than one from a buyer who’s more dependent on a loan.
So in addition to considering the dollar amount, you should review the terms of the entire contract with your real estate agent. For instance, consider how much cash the buyer is planning to include in the offer. More cash — and a correspondingly lower home loan — can ease a closing.
Compare the conditions of the offer
When buyers make an offer, they’ll often include a few conditions that, if not met, allow them to cancel the deal. These conditions of the offer may include Condition of Financing, Condition of Home Inspection, Condition of Condo Doc approval. If you have multiple offers – you may want to choose the offer with the fewer conditions to be more certain of a Firm Sale.(yes that means even if the offer is a lower price)
Review Possession Dates
Possession or closing dates could also be a deciding factor for you. Are you in a hurry to sell your home? Is your work transferring you to another city? Have you already bought your next home and want this one sold faster? There could be several reasons why you may choose the offer with the fastest Possession Date proposed. Alternatively, you might not be ready to move as quickly as someone has proposed. Maybe you weren’t expecting your home to sell as quickly and you need time to move – then the offer with the latest possession date may be your best choice.
Any way you look at it, you should be elated that you have multiple offers. It shows that you have an incredible property that others are extremely interested in acquiring. Take your time to review each contract in it’s entirety weighing the pros and cons of each and sign the best contract for you.