Behind The Scenes Look at What Gets Your Offer Accepted Over Others

By
Real Estate Agent with United Real Estate TX #0552717

Earlier this month, I listed a cute little one-story home on a Thursday morning. By the next morning, there were 7 offers. Before the Saturday afternoon cutoff time, there were an additional 5 offers. The following Carrollton Zero Lot Homeexplains how the seller determined which offer to accept.

The home was listed at $125,000. ALL the offers were at or above list price. This is a very competitive price point in the Dallas area, and one-story homes are especially appealing.

All the buyers agents, and in one case an unrepresented buyer, were told this was a multiple offer situation and all either agreed we had their clients' highest and best offer, or they changed the offer to make it the highest and best.

I prepared a spreadsheet for my client with all the particulars of each offer condensed onto one page for an easy side-by-side comparison.

I entered the details of each offer, such as the offered amount; request for seller contribution towards closing costs; amount of earnest money; the title company; the amount of money requested from the seller for the first year of a residential service contract (home warranty); closing date; amount of the option fee and number of days; the type of payment (cash/loan and FHA or conventional - there were no cash offers); if proof of funds/pre-approval letter was received with the offer; if the signed seller disclosure notice was received with the offer; amount of money down vs. amount financed; who would be paying the HOA fees; and other important information.

Once all the details were in the spreadsheet, I sorted it from the lowest grossing offer to the highest based on just the offered amount and the seller contribution towards closing costs.

It was tempting for my seller to look at just the best few in terms of the amount she'd put in her pocket, but we went through all of them.

Some of the things that got offers tossed aside?

  • Incomplete offers where not all the fields were filled out (this, despite my reminders to the buyers agents who submitted incomplete offers )
  • One buyer wanted the title company to hold just $500 in earnest money (1 to 2% is common here)
  • The amount requested for the seller to contribute to the first year of the home warranty 
  • Closing dates far in the future
  • The number of days for the option period
  • The amount of the option fee (one buyer was willing to spend just $1)
  • High number of days for the third party financing approval
  • Closing date on the Sunday of Memorial Day weekend (really!)

Once the seller weeded out the non-competitive offers, she focused on her top four.  All four were at least $5,000 over the list price. Three were conventional loans, one was FHA. 

The seller selected an offer that eventually closed. It was a clean offer, with all fields filled in, and both the pre-approval letter and the signed seller disclosure notice came in with the offer. Although the cash down on this conventional loan was only 3.5% and other offers were in the 15-20% range, other factors weighed in more heavily. The buyer stripped all the "extra" stuff out of the offer. She didn't ask for help with closing costs. The amount of the earnest money was more than 1% to show good faith. The buyer agreed to pay the cost of a new survey if the seller's survey wasn't acceptable to the title company. She didn't ask the seller to pay for the first year of a home warranty. She asked for only a 5-day option period. And she certainly offered more than $1 for that privilege.

The difference in the estimated net-to-seller between the top two offers considered was less than $1,000. More than half of that difference? The other buyer wanted the seller to pay up to $520 for the home warranty. Had that not been in there, would the seller have chosen that offer? Maybe. They were offering double the amount for the option fee and just two days longer. Theirs would have been a quicker close (by 4 days).  They were going to put down 15%.

One other thing the new owner did was to write a personal note to the seller explaining why she wanted THIS house. Her agent told me that she had lost out on at least 10 other homes - due to multiple offers - and this was THE one for her. That was reflected in the clean offer with just the right amount above the list price to make it hers.

And yes, it did appraise! Barely. After a second appraisal.

If you're a buyer, to get YOUR offer accepted by a seller, consider ALL factors, not just price!

 

 

Posted by

Lorrie Semler, e-PRO, GRI, SRES, CPRES, CRS
Addison Resident/Addison Specialist                                                      Subscribe Button
Real Service. Real Results. Real Estate.
United Real Estate
972-416-3417

http://www.AddisonUpdate.com                                                                                                                         

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Show All Comments
Rainmaker
1,071,619
Kevin J. May
Florida Supreme Realty - Hobe Sound, FL
Serving the Treasure & Paradise Coasts of Florida

Gotta love the fairy tale ending Lorrie. Good for her and you! Price and terms go hand in hand from contract to closing.

Jun 28, 2015 08:55 AM #1
Rainmaker
2,126,849
Ronald DiLalla
Century 21 Discovery DRE 01813824 - Anaheim, CA
No. Orange Cty Real Estate

Amazing how a personal letter sometimes works...more often then not.

Jun 28, 2015 09:48 AM #2
Rainmaker
1,297,786
Lorrie Semler, REALTOR® in the Dallas area. Call/text 972-416-3417
United Real Estate - Addison, TX
Real Service. Real Results. Real Estate

Kevin J. May As does working with a professional on the other side of the deal.

Ronald DiLalla I'm surprised more buyers don't write those personal letters.

Jun 28, 2015 11:37 AM #3
Rainmaker
680,255
Nicole Doty - Gilbert Real Estate Expert
Zion Realty - Gilbert, AZ
Broker/Owner of Zion Realty ZionRealtyAZ.com

I write personal letters for my clients all the time. They really do make a difference!

Jun 28, 2015 12:54 PM #4
Rainmaker
840,966
Troy Erickson AZ Realtor (602) 295-6807
Good Company Real Estate - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Lorrie - Thanks for sharing this real-world experience. I have known personal letters to make a difference on more than one occassion.

Jun 28, 2015 03:54 PM #5
Rainmaker
1,071,619
Kevin J. May
Florida Supreme Realty - Hobe Sound, FL
Serving the Treasure & Paradise Coasts of Florida

Lorrie, that goes without saying!

Jun 29, 2015 07:07 AM #6
Rainmaker
2,930,427
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Sometimes the tiniest nuanced details make all the difference in the wide world, you know? Good observations!

Jul 07, 2015 04:12 PM #7
Rainmaker
2,930,427
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Kevin, sometimes I guess the obvious needs to be said even when we feel it's not necessary.

Jul 07, 2015 04:13 PM #8
Rainmaker
2,930,427
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I meant to tag Kevin J. May in that previous post. That was a great point, but again, the obvious might need to be stated as in the above in the story.

Jul 07, 2015 04:15 PM #9
Rainmaker
1,071,619
Kevin J. May
Florida Supreme Realty - Hobe Sound, FL
Serving the Treasure & Paradise Coasts of Florida

Laura Cerrano, in love, war or Real Estate a little reinforcement never hurt anyone!

Jul 08, 2015 01:23 AM #10
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Rainmaker
1,297,786

Lorrie Semler, REALTOR® in the Dallas area. Call/text 972-416-3417

Real Service. Real Results. Real Estate
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