4. What to Expect When Your Home is Shown to Buyers
Serving Hampton Roads
Congratulations!
You've reached an exciting stage in the process! One or more of the many buyers who have viewed your home has decided they would love to make it their own, and submitted an offer to us! There is a lot to consider at this stage, especially when comparing multiple offers, but we will break it down and go through each term and piece together.
Offer Presentation
I will let you know promptly as each offer comes in. If we are comparing multiple offers, I will email each to you separately and then draw up a spreadsheet that directly compares them in price, costs, and other terms. Ultimately, it is up to you to decide what your greatest priority is and whose offer you would like to accept on your home.
OFFER VOCABULARY
PRE-APPROVAL
First, each and every offer should come with a full approval for the amount stated in their offer, if not more. This assures you that they can obtain the necessary loan and follow through to closing.
CONTINGENCIES
This is something that could prevent the buyer from closing or the sale from going through, that is being anticipated from the beginning. Some examples are releasing based on home inspection, the need to sell a home before the buyer can purchase yours, or the appraisal value coming in low. The fewer contingencies on an offer the better it is for you as the seller, because there are fewer ways the buyer could get out of the deal.
CLOSING COSTS
While you will be paying your own closing costs, sometimes a buyer will ask you to contribute to or pay for their closing costs as well. This is often the case with first time homebuyers. Consider this especially if an offer comes in high to see what your true net profit will be.
REPAIR REQUESTS
If the home needs some repairs, but you don’t have the time or money to do them, a buyer who is willing to do them for you might be what you need.
FINANCING TYPE
A cash offer is usually more appealing than a finance offer as the seller doesn’t need to worry about the bank approving the loan. A conventional loan is often the least complicated. This is an appealing choice for sellers. An FHA loan can cause delays because they require certain repairs and approvals. A VA loan also could require certain repairs to be made, but is one of the most common loan types in our market.
TIMELINES
You might need to close quickly to move on to the next adventure, or you might need to extend the closing to allow time for the next home to be ready. Choosing the offer with the closing time that fits your needs will be most attractive to you. Typically shorter time periods on the buyer’s end, like inspection periods or negotiations, are beneficial because you quickly remove obstacles that could prevent closing.
BUYER LETTER
If you care about the future of your home, a buyer letter could assure you that you’re selling to someone who will love the home and your neighbors as much as you did.
OFFER PRICE
Of course, price matters too! This is one of the most direct comparisons multiple offers can have. Just keep in mind that if a high offer will cost you more in closing costs, repairs, or other factors—then it probably won’t be the better offer.
Offer Negotiation
Most offers require negotiating either before or after inspections. I will explain all terms and negotiate them on your behalf. You can accept an offer if the terms are satisfactory, or reject the offer if it isn’t close enough to your expectations and there is no need to further negotiate. Additionally, you can counter the offer which means to return an offer of different terms to the buyer. The buyer can then choose to do one of the following:
- Accept the counter-offer
- Decline the counter-offer
- Or Counter the offer
You can negotiate back and forth as many times as needed until you can reach an agreement or someone chooses to walk away.
Offer Acceptance
You will sign the purchase agreement and you are now officially under contract! This period of time is called the contingency period. Now inspections, appraisals, or anything else built into your purchase agreement will take place.
