OFFERS - THE GOOD, THE BAD AND THE UGLY
When is an offer a GOOD offer? Of course, the first thing that comes to mind is PRICE. Yes, price is important but you can get your asking price and still have a bad offer.
You need to dig and see what is behind the price. What is the quality of the buyer? How much are they putting down in order to get the loan? How far along are they in their loan application? Has credit been run and what are the obstacles? Can the obstacles be overcome and how long will it take them to be overcome? Are they buying for investment or as a primary residence? Are they trying to "flip" the house? How much are the putting down for earnest money? Do they have to sell a home in order to buy yours?
Your asking $230,000 for your home. Your receive TWO offers:
Offer #1 - You receive a full price offer ... Woo hooooo !!! What a deal ... where do I sign! They want to do 100% financing, interest only payments. They ask for a 45 day escrow so they can do their inspections, get loan approval, title commitment, survey, etc. They live in town, have their home under contract due to close in 35 days.
Offer #2 - $220,000 with 20% down, close in 30 days. They are firm with this offer ... take it or leave it.
No contingencies, they've sold their home in California, being job transferred and have to buy.
So which is better? Depends on the risk you want to take. Offer #1 has alot of things that can go wrong. I'll save that for another blog ... unless you want to know right away then just email or call me and we can discuss.
You need to put your business hat on here. For $10,000, are you willing to jeapordize yourself moving to your next step in life? Offer #2 has a lot of strength behind it. If you choose #1 and it goes south for ANY reason, then you can bank on buyer #2 being forever gone. You've lost marketing time, you can't move forward and you have to start all over again. By the time you get another offer, maybe you'll only get a $235,000 offer ... which means your true risk is only $5000!
If you're selling your home on your own, these are vital things to remember. An astute buyer, or worse yet a non-astute buyer, can tie up your home for a long time. I always recommend the use of a professional as they can help forsee a lot of pitfalls and can save you time and money. That's where the true value of an agent lies.
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