How to make a contingent offer more attractive to the seller

It’s the old chicken and egg dilemma: What should you do first? Buy a new home or sell the old one?

Buying a new home before you sell your current one can mean two houses and double mortgages. But selling your present residence before you find a suitable replacement means you might not find the house of your dreams before closing on the old house. The solution is to make an offer contingent on the sale of your present home. Though not very popular  in a stagnant market, a so-called contingent offer is now worth considering. But be aware: Contingent offers do put you at a weaker position if competing with other buyers who don't have contingencies.

That's why it's important for you to make your offer as strong as possible. Here are three ways you can improve your  contingent offer in the eyes of the seller.

1. The first thing you can do is put your current house on the market and get it into escrow. Since that’s a bit of a risk for you, you can also make the sale of your home subject to finding suitable replacement property, which means you don’t have to sell it until you find a replacement property that you like.  The seller will know you are actively trying to sell and have a greater chance of purchasing sooner.
2. The second thing you can do is put down more earnest money, also called the good-faith deposit. In this county, the norm is 1%, but in other counties like Los Angeles and San Francisco the norm is 3%. So find out what the norm is in your area and improve on it to show you are a serious buyer and help reduce the risk of the contingency in the eyes of the seller.
3. Last, maintain the contingency removal period, which is the time during which you have to do all inspections, read disclosures and ask questions. It normally lasts 17 days. Honoring the contingency removal date (and not asking for an extension)  means you will have to come up with money for inspections, etc., during this time frame, but it also shows your faith  in being able to secure an offer on your home and makes your offer more tenable in the eyes of the seller.

There are lots of other ways you can improve your offer. Give me a call today and we can talk about your situation.