Congratulations, Mr. & Mrs. Seller, there's an offer on your home! 

Here's what you can expect when we sit down together to consider it:

The first thing we'll do before we even look at the offer is to review an updated Market Trends Analysis that's similar to the one I prepared for you when we listed your home.  Second, we'll review an updated Comparative Market Analysis. These reports will provide an objective point of view on the market today to confirm that little or nothing has changed since the listing date or to identify any changes in the real estate market that may impact your perspective on this offer.

 

There will be many details in the 50+ pages of this offer, but there are only a few factors that have a "make it or break it" effect for most home sellers.  That's why we'll look at these factors even before we consider any other contract details.  I call them The Big Seven, as we discussed when we listed your home and wrote down your home selling goals.

  1. PRICE -How does the price compare with the likely sale price we discussed at the listing appointment?  Let's look at an updated Comparative Market Analysis to see if more recent sales still support that price.
  2. SELLING CONCESSIONS - Does the buyer ask you to pay all or part of his closing costs or to make major repairs?
  3. NET PROCEEDS - What is the bottom line, i.e., the money in your pocket after all closing costs, concessions, adjustments, and payoffs? This is probably more important than the sale price.
  4. FINANCING - Does the buyer's choice of financing impact your net proceeds?  Ask me to explain how we can address this issue.
  5. SETTLEMENT DATE - Does the buyer's timetable match yours?  Is there adequate time for inspections, appraisal, repairs (if any), packing and moving? Will your next home be available on the proposed settlement date?
  6. INCLUSIONS/EXCLUSIONS- Is the buyer asking you to include anything that you didn't offer... the washer and dryer, for example, or the light fixture you received as a wedding present?  Are you willing to give up a sale rather than buy new curtains for your next home?
  7. CONTINGENCIES - A contingency-free contract is always the best, but there are some contingencies to be expected - Financing, for example, or a home inspection.  If the offer is contingent on selling the buyer's house, are you prepared to take your home off the market for a "Maybe"?

 

We'll rate each of these factors with a score of 1-3 and evaluate your offer in the manner described on the screen shot above.  Once a determination is made about The Big Seven, we'll review together the entire offer from start to finish.  As we do, I'll take notes on a separate piece of paper about any missing or unsatisfactory disclosures or terms so we can address them in a written counter-offer.

Shall we get started?

Copyright 2006-13. Margaret Woda. All rights reserved.

  DISCLAIMER: Information contained in this post is deemed reliable on the date of publication, but it is not guaranteed and it is subject to change without notice.

________________________________________

Margaret Woda, Crofton Realtor


Margaret WodaMargaret Woda, REALTOR & Associate Broker
Long & Foster Real Estate, Inc., 2191 Defense Hwy., Crofton, MD 21114
Direct:  (410) 451-6245 or click on EMAIL

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16 Comments on The Big Seven of Any Contract Evaluation

AUG
25
191,609 Points 2 Featured Posts Outside Blog

50 pages plus???  Egads, here I thought the 16 pages plus disclosures was ridiculous in our state.  It must really be an event when reviewing those contracts.  You have good 7 points to cover, as well!!
7:43am • #1
397,041 Points 5 Featured Posts Outside Blog Attended Rain Camp

Margaret, you nailed it.  I bookmarked this and am going to share it with my agents.  Thank you for this post.  It really reduces the decision making down to what is really important.
7:45am • #2
545,171 Points 120 Featured Posts Called Shot Master
Margaret. Those really are the big seven. It amazes me how many times a deal gets stalled because of inclusions or exclusions. A really smart seller would say WYSIWYG and not try to exclude things.
8:06am • #3
823,950 Points 155 Featured Posts Localism Sponsor Outside Blog Hit Router Attended Rain Camp Called Shot Master

Dan, a contract was 1 page on a legal-size sheet when I started in this business.  Now it's ridiculous.  Yes, it's rare to be fewer than 50 pages in Maryland, by the time you add all the disclosures and notices to the 10-page contract.

Gary, I learned a long time ago that there's no point in fretting over the minor details unless you have a sense of whether this is a workable offer.  Feel free to share.  At the listing, I provide sellers with a worksheet to write out their home-selling goals based on these same factors, and it comes in handy when the offer comes in and we go over this Contract Evaluation.  (The screen shot is a mini-version.)

Valerie, isn't that the truth?  I agree completely, and I tell my sellers that anything is fair game if they leave it in the house for showing.  If they want to exclude the curtains or light fixture, remove it... if they want to exclude the W&D, put a sign on it  but don't be surprised to find it included in an offer.
8:07am • #4
817,202 Points Outside Blog Called Shot Master

Some good tips for a list of things to go over with sellers and buyers.  Thanks for sharing.
8:33am • #5
499,569 Points 22 Featured Posts Outside Blog Attended Rain Camp Called Shot Master
What a great way to help the sellers analyze the crucial elements of an offer to decide how to respond. A businesslike approach like this probably helps them focus objectively and minimize emotional reactions.
9:04am • #6
110,754 Points

Good information for all to consider in real estate.

Bob Usey Properties

Mississippi Gulf Coast

Web Site: BOBUSEY.COM

 
10:41am • #7
498,310 Points 150 Featured Posts Outside Blog Hit Router Called Shot Master

Margaret:  Whether buyer or seller, real estate transactions are not simple or simplistic.  But you break it down here in very easy to tackle and understand increments.  I've "Suggested" this post.  It will be Featured here ... as I think your form and your breakdown can prove very beneficial to client and professional alike ...

Featured in BananaTude!

BananaTude Pic 

Congratulations!

Gene
12:34pm • #8
412,847 Points 16 Featured Posts Outside Blog Called Shot Master

Margaret, that is exactly how I would evaluate a contract.
4:34pm • #9
565,808 Points 6 Featured Posts Outside Blog Attended Rain Camp

I just submitted a 123 page contract on a relocation property for a buyer of mine.  It's the largest yet.  But you're such an experienced agaent Margaret and really have your clients best interests at heart.  Your evaluation  methodology is perfect for your clients.
8:13pm • #10
AUG
26
275,890 Points 17 Featured Posts Localism Sponsor Attended Rain Camp Called Shot Master

Very clear and concise.  Seller (and buyer) education is such a key component of what we do. You have a great way of communicating!
6:32am • #11
823,950 Points 155 Featured Posts Localism Sponsor Outside Blog Hit Router Attended Rain Camp Called Shot Master

Edward and Cecilia - Thank you.  It does help focus the conversation.

Nancy - I came up with this to simply contract evaluation for my 85 year old mother, and wondered why I didn't use it for everyone.

Bob - Thank you.

Gene - It's not for every agent or client, but some people need a guide to help get them through those 50+ page contracts!

 
5:55pm • #12
823,950 Points 155 Featured Posts Localism Sponsor Outside Blog Hit Router Attended Rain Camp Called Shot Master

Kathy -  The key to this is making sure you and they can articulate their goals up front, because then you have something to measure against.

June - OMG!  123 pages... that's a record.  (Although I have hundreds of pages of documentation for a short sale...)

Kathryn - Nothing like a road map to help you get to your destination.
5:58pm • #13
AUG
27
1 Featured Post Outside Blog

Margaret, This list is beautiful and covers all of the main points. I am bookmarking this to share with my agents as well as reblogging. Great way to break down this task into small manageable pieces for your clients. Kudos! ~Marisa
12:45am • #14
299,746 Points 21 Featured Posts Localism Sponsor

Wow Margaret - GREAT post!  Kudos to you for breaking down our outrageously large long contract and simpifying it.  This would be a great re-blog.
1:13am • #15
148,589 Points 3 Featured Posts Outside Blog Hit Router Called Shot Master

Margaret - 

These are exactly the items I glance over when opening up a contract for the first time.   I also look at:  Additional Addendums, and additional terms.   I probably look at title company too to see if I can persuade the buyer into using my preferred title company.   Do you?   Shanna
2:11am • #16


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Margaret Woda, Maryland Real Estate & Military Relocation Services

Margaret Woda

Crofton, MD

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Long & Foster Real Estate, Inc., Crofton, MD 21114

Address: 2191 Defense Hwy., #120, Crofton, Bowie, and Davidsonville, MD, 21114

Office Phone: (410) 721-1500

Cell Phone: (301) 346-2923

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Real Estate and community information for home buyers and sellers, military transferees, and rookie agents in the greater Crofton area, including Bowie, Davidsonville, Fort Meade, Gambrills, Odenton, and the U.S. Naval Academy in Annapolis.

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