Developing an Offer Strategy
Before an offer becomes an agreement, there are many elements we must negotiate with the seller, including price, closing date, and contingencies.
Here are a few common items that must be negotiated and how we optimize your offer:
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Including down payment amount, earnest money amount, etc. Using our local market expertise, we want to make an offer that the seller accepts while making sure you don’t overpay. Minor tweaks to terms in this category can make even lower offers enticing to a seller, even in a competitive scenario.
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Including closing date, move in date, included/excluded items, etc. Certain sellers care more about certain terms. It’s our job as your advisor to get as much information as possible beforehand to make an offer that makes sense for both you and the seller. This is where itms like “rent-back,” “home warranty,” and other negotiating strategies come into play.
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Contingencies are clauses we include to protect you as a buyer. These mean “the sale of this property will only happen if” each of your contingencies are met. If not, you will be able to terminate the contract and receive your earnest money back. How long these contingencies last can be an effective negotiating tool.
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The inspection contingency allows you to back out if you are not satisfied with the results of the home inspection, or are unable to come to an agreement with the seller on repairs or concessions. Inspections are not required, but highly encouraged. Shortening our inspection contingency or negotiating up front are ways we compel sellers to entertain our offer.
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If you are unable to get home insurance on the property at a rate below one half of one percent of the purchase price, you are able to back out of the purchase and have your earnest money returned.
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The title contingency allows you to back out if there are defects or conditions on the title that may prevent the seller from selling, or from you using the property as you intend. The title search will reveal if there are easements on your property (agreements that allow access to your property by the city, utility providers, or neighbors) and other items that may effect your use.
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The financing contingency allows you to back out if your application for a mortgage is not approved, or if your circumstances change and you are no longer able to obtain a loan.
