Welcome to my blog on why choosing the right offer isn’t always the highest offer when selling a house. Are you in the process of selling your home and have received multiple offers? Have you received an offer that is significantly higher than the others? It may seem like a no-brainer to go with the highest offer, but is it always the best choice? In this video, I’ll be discussing some important factors to consider when selling your house, even if the highest offer seems tempting.
So, if you’re thinking about selling your house or you’re in the process of doing so, stick around and learn more. We’ll be covering topics such as the importance of the buyer’s financing, the terms of the offer, the buyer motivation, and your own goals and priorities. By the end of this video, you’ll have a better understanding of how to evaluate offers and make a decision that is best for your unique situation.
My name is Brian Johnson and I’m a real estate broker right here in Spokane with Windemere Valley Liberty Lake. If you have any questions about real estate, whether you want to sell your house, buy a house, or start a real estate investment portfolio, feel free to reach out to me. My contact information is right here.
Now, let’s get into the main topic: evaluating offers on your house. There are several factors to consider when evaluating offers, and it’s important to weigh each one carefully before making a decision.
- The importance of the buyer’s financing cannot be overstated. Not all offers are created equal, even if they are for the same price. If a buyer is obtaining a mortgage or has a mortgage contingency in their offer, there is a risk that the financing may not go through. This can cause delays or even lead to the deal falling apart completely. On the other hand, a buyer who is paying cash or has already been pre-approved for a mortgage may be a more reliable option. One thing to consider is the size of the down payment. A buyer who puts down a larger down payment, such as 20%, may be seen as a more financially stable and reliable buyer. On the other hand, a buyer who puts down a smaller down payment, such as 3.5% for an FHA loan, may be seen as a higher risk. This is because a smaller down payment means that the buyer has less invested in the property, which can increase the risk of default. It’s important to do your due diligence and ask for proof of financing, such as a pre-approval letter from the lender. This can give you peace of mind and help ensure that the sale goes smoothly. Remember, the financing of the buyer can impact the sale of your house, so it’s important to consider this factor when evaluating offers. Don’t just go with the highest offer if it comes with financing risks.
- The amount of earnest money is an important factor to consider when evaluating offers on your house. Earnest money is a deposit made by the buyer to show that they are serious about purchasing the property. It is typically held in escrow until closing, at which point it is applied towards the purchase price of the house. The amount of earnest money can be a good indicator of the buyer’s level of commitment and financial stability. A buyer who puts down a large amount of earnest money may be seen as more serious and financially secure. On the other hand, a buyer who puts down a small amount of earnest money may be seen as less committed or financially risky. In addition to being a sign of the buyer’s commitment, the amount of earnest money can also serve as a negotiating tool. If you receive multiple offers on your house, you may be able to use the amount of earnest money as a way to differentiate between the offers. For example, you may choose to go with an offer that has a lower price but a larger amount of earnest money, as this may indicate a higher level of commitment from the buyer.
- The terms of the offer should also be taken into consideration when evaluating offers on your house. The terms of the offer include the closing date, contingencies, and other conditions that must be met before the sale can be completed. A buyer who is willing to close on a shorter timeline may be more appealing, as this can help speed up the process and reduce the risk of delays. Contingencies, such as a financing contingency or a home inspection contingency, can also impact the terms of the offer. It’s important to carefully review the terms of the offer and consider how they may impact the sale of your house.
- The motivation of the buyer is another factor to consider when evaluating offers on your house. Understanding the buyer’s motivations can help you make a more informed decision about which offer to accept. For example, if a buyer is in a hurry to move and is willing to pay a premium price to do so, this may be a more attractive offer. On the other hand, if a buyer is simply looking for a good deal and is willing to negotiate on price, this may not be as appealing.
- Finally, it’s important to consider your own goals and priorities when evaluating offers on your house. What is most important to you in the sale of your home? Is it the price, the terms of the offer, the buyer’s motivation, or something else? Consider what is most important to you and weigh each offer accordingly.
In conclusion, there are several factors to consider when evaluating offers on your house. It’s important to do your due diligence and carefully consider each offer before making a decision. Don’t just go with the highest offer if it comes with financing risks or other potential drawbacks. Instead, take the time to evaluate the buyer’s financing, the amount of earnest money, the terms of the offer, the buyer’s motivation, and your own goals and priorities to make a decision that is best for your unique situation.