So you have a buyer who submitted an offer on your home, congratulations! The best case scenario is you have multiple buyers who submitted offers on you home. What to do now?
Negotiating offers is an art-form. This is where the research from Part 1 comes into play. Depending on how long it took to receive an offer (or offers) on your home, you need to know the latest data. It could possibly be time to do more research. You need the most up-to-date data.
Factors to consider:
- Is the offer reasonable?
- Take into consideration the offer price, any seller help requested, the inclusions and exclusions, the types of inspections requested, the closing date, downpayment offered, type of loan, and any other concessions. Will your house meet the criteria for the buyer’s type of loan? Or will you be expected to spend monies you aren’t prepared to spend?
- How will the offer affect your “bottom line”? It’s time to prepare another “net sheet” to see if the offer will work for you financially.
- After your buyer has their inspections completed, are you prepared for the things they want you to fix? Did the radon results come back higher than the recommended limits? If so, you can expect your buyer will insist you install a radon mitigation system. Did the home inspector uncover an issue when he removed the cover of your electrical panel box? If so, you can expect your buyer will want a licensed electrician to fix the problem. No matter what else was uncovered, you can expect your buyer will insist you have a licensed professional fix the problem. Are you prepared to negotiate these (and other) issues by yourself?
After you have reached an agreement with your buyer, are you prepared for what’s next? There’s more to do!
- Make sure you have a legal contract, including the local addendums, financing addendum, inspections addendum, and more. Why is this important? You want to make sure your buyer can’t change their mind, “find a loophole in the contract”, and “walk away”
- Additionally, you want to make sure the contract protects you 100%, to reduce your chances of being sued.
- Make sure the buyer provided an earnest money deposit, and ensure it’s been deposited into a non-interest bearing account.
- Make your home available to any inspectors and the appraiser at their convenience.
- Be prepared to deal with the results of all inspections.
- If your home doesn’t appraise for the agreed upon price, be prepared to re-negotiate. Just because you thought your home is worth a certain price doesn’t guarantee the appraiser will agree. There are times when an appraiser will assign a lesser value. Are you prepared? Do another net sheet to see how it will affect you and if you can afford to sell for a lower price.
- In Maryland, buyers select the title company. You, as the seller, have no say in which title company the buyer chooses. Attorney’s are capable of handling the sales of FSBO homes. In some states, using an attorney is required. In Maryland, buyers want to use a title company. The title company not only prepares all the documentation, but also researches the title to the the property. They are the experts in performing this vital element of your home sale. Be prepared to provide the requested documents to your buyer’s selected title company. Documents typically requested include the contract of sale, payoff information, home warranty information, tax record, front foot benefits, public utility info, and anything else the title company requests.
Click HERE for the final step – SETTLEMENT!