Here are four tips to help guide sellers who’re facing multiple offers.
If you’re thinking of selling your home, knowing how to work with multiple offers is a must. Multiple-offer situations are common in our market right now. If you list your home and it generates multiple offers, there are four steps to remember to make sure you have a smooth and successful transaction:
1. Qualify your buyers. The last thing you want to do is accept an offer where the buyer can’t actually make it to the closing table. Look at the financial qualifications for each buyer so you can be sure they’ll be able to carry out the contract they’ve offered. It may also be a good idea to check in with the lender to make sure the buyer has actually been qualified and started the process. You want to make sure they don’t just have a preliminary pre-qualification letter.
2. Look for the best terms. This will include earnest money. Earnest money should be at least 1% of the purchase price in today’s market. We want to make sure the buyer is serious. You should also consider how much their down payment is. This will let you know how much liquid cash each buyer has, giving you a better sense of their total purchasing power. Additionally, determine each buyer’s flexibility on their closing date. More flexibility means more time for you to prepare the home and move.
3. Check for an appraisal gap guarantee. Should the appraisal come in low, which is always a huge concern for sellers, is the buyer willing to bring the cash difference so they can still buy your house? Just because a buyer offers more doesn’t mean that it’s always the best offer to accept. Ultimately, it’s best to have the buyers who are willing to back up their offer with an appraisal gap guarantee.
4. Have a backup offer in mind. When there are lots of qualified buyers in the market, the opportunity to accept a backup offer is important because the first offer could fall through. This way you can keep moving forward with the transaction without starting all over again and having to look for a new buyer.
Also, because of how hot our market is now, accepting an offer is often much more complicated. We’re here to help, so if you have any questions at all just let us know. If you want to know what your house is worth, contact us.