There are several items that can come into the mix. The tier is cash, conventional then fha as far as best terms. If you opt to not do an inspection (risky but would remove the contingency), if you offer a higher EMD (that money will come off of what you'll owe) it could show you're a more serious buyer than someone who would put down a minimal amount.
You never know what the other offer is. The banks do what they want to do (even if it sometimes doesn't make sense to us).
It's likely that the seller views your offer as one that with enhancement could find you in the "winner's circle."
It is a fact that banks like cash offers and often lean toward them. But a cash offer in not necessarily iron clad. "Highest ans Best" can take on many different considerations: minimal contingencies, flexible closing, no seller concessions, cash deal, etc. to name a few.
Also there are no guarantees with offers. People have second thoughts, plans change, new opportunities arise, etc. An offer that has little appeal initially may be a long shot but shouldn't be ruled out because things change.
Cash offers will not have a appraisal contingency!
The bank know what this means and they would do well to avoid further negotiations.
Purchase offer price is only one element of the buyers proposition. Unfortunately, there is no transparency in these situations and create a fertile ground for conspiracy theories. The truth is you will succeed in purchasing a house if you listen to the council or your pro adviser.
Put is your best offer and then start looking for another home. You never know what will happen.
I think it's in the real estate agents hands to help make a good presentation about their buyer in order to be among the top contenders in the offer race. I use a couple creative techniques to stand out. Success 90% of the time.
Best of Luck.
While Cash is King for a number of reasons, the bank is asking all of the offers to go back, and rethink and possibly modify their offers. The bank might be hoping that one or more of you will change your offers to cash offers. (a "cash" offer doesn't actually have to be cash... it merely is an offer NOT contingent on obtaining a mortgage).
Don't fret... they're giving you an opportunity, just in case one of the offers is already "higher and better" than yours.
The reason a CASH offer is better, is that it is STRONGER; the Seller and the Bank do not have to worry about the financing falling through.
And whoever told you that the Banks ALWAYS take CASH offers over Loans, didn't know what they were talking about.
It really sounds like you are trying to do this without a Buyer's Agent advising you; because your questions should never have gotten this far.
Good luck and may God bless
Phyllis Crosby, Realtor/GRI
ReMax Realtec Group