Imagine for a moment…visualize and trust that your hard work has paid off, and you’re getting an offer from a Buyer.
What are some of the things you need to consider?
Examine the Offer
The offer will contain some important points that you’ll want to look over closely:
- Sales Price
- Closing Date
- Conditions (closing costs, home warranty, etc.)
- Earnest Money
- Option Period
There are several points to each offer that can be used to differentiate which offer is best for you during multiple offer situations.
Sit down with your agent to understand the terms of the offer. Ask lots of questions!
Is the sales price fair? If not, what are the logical, negotiation steps to reach your pricing goal?
What conditions has the Buyer included in their offer? What are the risks to you as a seller?
How much earnest money is the Buyer willing to put at risk? Under what circumstances would you retain the earnest money?
Have your agent pull an “Estimated Net Proceeds” worksheet so you can understand your selling costs. Your actual closing costs will be pro-rated by the escrow company based on the exact closing date, but you can come pretty close on your estimate.
Once you have reviewed all the parts of the offer, you can respond in one of three ways:
- Accept the offer – Congratulations, you’ve just sold your house!
- Make a counter-offer (with better conditions and/or price for yourself) – The Buyer at this point can accept your counter-offer, make another counter-offer or walk away altogether.
- Decline the offer and walk away.
This period starts immediately after both sides have agreed to terms of the Offer.
It allows the Buyer to do their due diligence such as having inspections and negotiating repairs.
During this time, they have the right to walk away from the deal for any reason at all without sacrificing their Earnest Money.
Once the Buyer has completed their inspection(s), they may ask for you to complete repairs noted in the inspection report(s).
These repairs are usually negotiated during the Option Period, and you can respond in the same three ways as their offer:
- Accept the requested repairs
- Negotiate the repairs (with better conditions and/or price for yourself)
- Decline the requested repairs and risk the Buyer walking away
Once the repairs have been completed, the Buyer will need to see that they have been completed as agreed. You will also need to keep receipts of those repairs.
Negotiations don’t just happen until you have an agreed offer, but continue throughout the transaction if needed.
Negotiating is a fine art, and when you’ve chosen your agent wisely, they’ll provide solid advice and guidance to get you the price you want. The final decisions when selling your home are always yours to make, but it helps to have a strategic negotiator on your side.
Every Buyer wants to negotiate a better deal, and you won’t know what their real motivations are until you negotiate. Stick with the negotiation.
If you can’t negotiate with this Buyer, what are your alternatives? How long before the next offer comes along? Understanding the current market conditions is critical to good decision-making.
Mortgage and Title
The Title Company is a neutral, third party that insures that each side completes what they agreed upon in the Offer. The Earnest Money and funds required for closing will go through them.
Throughout the entire process, the Title Company will be coordinating the completion of the following items:
- Transfer of title from you to the Buyers
- Payment of loans, judgements, or tax liens attached to your home
- HOA documents, transfer, and prorated payment
- Payment of prorated taxes
- Required survey of the property
- Any other items that are required to complete the sale
The Title Company will be contacting you for documents to complete these tasks, and the faster your response, the smoother the process will go.
Closing – Review all the documents that you will be signing, prior to the closing, and ask the closing officer any questions that you have. Once you sign, you are obligated to the terms.
For more information, please use the following valuable resources for information about selling your home: