Generally, Sellers want max cash as fast as possible, with the lowest risk that the sale will fail. About the strongest offer we encounter is: cash, no seller concessions, property in "as-is" condition and closing in 10 days. The closer a Buyer's offer is to this ideal, the "stronger" their offer will be.
I custom craft the strongest offer possible based on each individual Buyers financial profile and situation - there are a lot of variables. Three other things might entice the Seller to take one offer over another:
1) a short due diligence period and large due diligence fee that becomes the property of the Seller at acceptance of the offer and which is applied to the purchase price but otherwise non-refundable to the Buyer;
2) Type of financing and down payment;
3) Some compelling personal story about the Buyer may entice the Seller to choose their offer over an faceless investor.
If you have a full time agent with a Masters degree in Planning with Finance and over two decades of experience, working for you, you will likely do better in negotiations. If you appreciate this answer, please give it a thumbs up, or if this was the most helpful answer, please say thanks with a best answer click.
1. larger due diligence fee. The more money you have in the game the greater the chances that you will close and the less risk there is to the seller. Since this money is non refundable the more you put up on the house the more sincere you look at wanting the house.
2. Shorten the due diligence period. most agents are taking the due diligence period out to a week to a few days before closing. By making it two weeks or less you are not keeping the seller hanging on the offer worried that you may cancel or not.
3. Increase the earnest money on the offer to show you are serious about buying the house.
4. Remove any contingencies you may have with the offer. Like having to sell your house to buy or conditional on a job transfer....
5. Change the closing date to be more accomaditing to the seller or shorten it to show the seller you have done most of the legwork in the process to get the loan approved.
6. get a pre-approval letter versus a pre-qualifcation letter. This shows the mortgage broker has actually looked over your paperwork and is confident on giving you the loan based on your paystubs and bank statements.
7. put in writing you are only going to be looking ofr the seller to do certian repairs based on the home inspection. Nothing irritates a seller more than a buyer who asks for every little thing to be fixed or repaired. Limit the scope fo repairs to needed repairs or ones that affect the structural integrety fo the house, or electrical issues or plumbing issues and not little things.
8. Change your loan type if possible form FHA to cnventional. if you have a high enough credit score you can get a conventional loan with as little as 35 down. the seller doesd not need to knwo it is 3% down but it probably carries a little more weight than a FHA loan.
9. limit the items you might be asking for in the house. A lot fo buyers will ask for the refridgerator or other items. remove them from the equation especially if they seem newer or worht a lot of money
These 9 things can help bridge a gap between the seller and the buyer without changign the price fo the house and help put a deal together.
Coldwell Banker United
This assurance is provided based on the sensitivities of the seller and the local market. Remove the road blocks and ostacles and the likely outcome is you will prevail over the FHA/VA offer that is 6% above list price.
Best of success,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
Licensed Associate Broker
Accredited Buyer Representative
William Raveis Legends Realty Group
Here are a few ways you can effectively increase your chances of getting your offer accepted without going "higher" as you said...
1) Cash offer (as Bill said)
2) A shorter due diligence period (do this ONLY if you know you can get full loan approval in the time you specify, and you can get your inspections done quickly) - 2 to 3 weeks due diligence period would be very attractive to a seller
3) Increase your due diligence fee (do this only if you feel the home looks as if it may not need repairs - age of home, roof & mechanicals, etc). Remember, the due diligence fee will be a credit to you at closing.
4) Higher earnest money deposit. Remember, you can get this back if you cancel before the end of the due diligence period
5) Do not include any contingencies with your offer.
Once you have an accepted contract, you can negotiate for repairs if this comes up after your inspections. Put your best foot forward if you really want the house. Consider how much other homes have sold for in the area; while also consider what else is available. Lower inventory has brought home prices up in our area because of the law of supply & demand.
Good luck. If you need a buyer agent who can help you navigate your way through this process, I am here to help.
Broker/Realtor/Owner of Sun Valley Realty
1. If possible make it a "cash" offer
2. Motivated sellers often want to put this experience behind them ASAP, so offer as early closing a date as possible
3. Minimize or eliminate "contingencies." They often scare sellers.
4. Consider making you offer an "AS IS" offer with the right to inspect and a "kick out" that allows you to back out of the deal without penalty if repairs exceed a specified amount
5. Offer a larger than normal deposit. Since you are going to buy it any way and your escrow deposit is protected by an inspection clause, what's the harm?
When these 5 considerations are applied, it makes any ordinary offer appear better.
We are seeing a lot of multiple offers in this hot seller's market. Your competitors are willing to offer more than asking in many cases and are doing the above suggestions to make their offer the "winner". At the end of the day, money talks . . .
Jen really hit the nail on the head there. If you don't want to raise your offer, give on other issues such as:
-Increase your earnest money deposit - A higher EMD means you have more stake in the game and won't back out for any old reason.
-Close quickly and with few contingencies - This is a biggie. A quick closing gives the seller the opportunity to move forward with their plans, and sell their home quicker than planned.
Those are a couple of the main issues; there are others of course.
Keep in mind though, most sellers in this market aren't all too concerned about the above, and are really more concerned with their bottom line.
I recently bid just under asking price on a small foreclosure that we knew had other offers on it. The buyer out up over $20k in earnest money, could close in 10 days, and offered to buy the home as-is, with no inspection. The seller ended up rejecting our offer and taking a slightly higher offer, simply because their bottom-line was more attractive.
Lots to think about for sure! Call or email me with questions!
Benham Real Estate Group