Step 2 - Where to Settle
We all have our favorites settlement companies in Bethesda, not because they are cheaper but because they've proven over time that they will get the job done with no problems. The last thing we want is for the settlement company to create problems for our real estate sales! But again, if the contract is not so perfect using a settlement company the listing agent trusts above all will ease the fear and make the rest of the offer more workable.
Step 3 - Big Earnest Money Deposit
Ain't nothing better than a lot of money in front of the seller! It was customary in the seller's market to put down 5% but today that is less so with more 100% financing (still occurs!). This money is extremely important to the ease the seller will feel taking his house off the market for 45-60 days. Sharing the risk with a large deposit can make even a lower price go down better. $1000 down is nothing for most people to lose and a seller is unlikely to to take a contract with such a low deposit. Big.Ole.Checks.
And let's have those checks actually be good :) If all goes well, it will be deposited the next day and deposited by the escrow agent very quickly. A bounced check right up front so doesn't put anyone's mind at ease! If money needs to be moved around in accounts to make it liquid, do it now before contract writing occurs.
Step 4 - Price and Comps
I'll have the comps for the Bethesda neighborhood ready so that you can always see how the home is positioned relative to current active property and very recent sales. Some real estate sales in Bethesda neighborhoods are still holding very strong and we'll find that an offer very close to asking price is going to be a winning offer and in others where there is more inventory that less than stellar offer might go through!
One very important statistic that I show to all buyers (and sellers when they price) is the average list/sale ratio that a given neighborhood is supporting. If they are getting 100% of their sales price, it might not be prudent to write a contract for 10% less but if they are consistently getting 96% of their sales price, then you are safe to assume that contract price will be expected.
While the national press would have us believe that every other home is in foreclosure and therefore easy pickins' the reality is that Bethesda real estate is still very strong with relatively low affordable inventory, especially in 20816. If the condition of the home is good then your offer needs to be strong. If condition is not so good there will be more room for negotiation. And if they made the dreaded error of seriously overpricing their home and now face the even more dreaded days on market, well then I'm sure you'll smell the blood in the water!
Step 5 - Sometimes it's not Price
- Offer $500,000 for a $499,900 sales price - goes a long way for the seller to be able to say they got over asking
- Let the seller keep their
junkno longer needed prized possessions in the house! If they are dreading cleaning tell them you'll get a dumpster and do it for them after settlement. It's not that costly!
- Offer a rent back if they need it - in multiples that's going to say "free rent back"
- Offer a longer settlement date if need be and understand how that will affect your rate lock
- If multiples, have the escalation amount be a high increment
Step 6 - How to Win!
It's hard to get past an offer that is written on paper and in front of that seller. Even the loudest critic of price reductions and low offers is silenced when there is the tangible evidence of cold, hard cash coming! So here are some of the ways to make that process work to our advantage:
- Make sure the contract is ratifiable. All initials in place, all addenda in place, all contingencies properly identified, lender letter strong and up front, big ole check copied for all to see.
- Face to face presentation. So many reasons to do this when possible (and it's not always) because the seller and the listing agent get to connect with the buyer agent who has very strong presentation and interpersonal skills. A well presented crappy contract can still get through when there is full confidence that the agent can get this to settlement!
- Time the response back from the seller. Within reason. We want to get the offer signed so that there is no possibility of another offer coming through in that time frame.
- Be available and ready to sign any counter. That might mean being at Starbucks, being right beside the fax machine, or being in another part of the office. We want to get to done!
Now believe it or not, once this is ratified the hard part begins... The easiest part was finding the home. It took a while to get through writing this contract and understanding all your options. Now we have to hold this together through the mine field that litters the way to settlement.
If you are buying a home in a Bethesda neighborhood, perhaps you might need my help.