You’ve listed your home, showings have begun, and now it’s time to prepare for incoming offers.  What should you know before this happens?

• Sellers should prepare for aggressive tactics by Brokers who want their offers accepted as soon as possible.  If a Seller has stated they want to collect offers until a specific date and time, they should stick to that commitment. This gives most Buyers a chance to schedule a showing and see the property. It also establishes a time line so any Buyer that is interested can submit their highest and best offer if they want to get in on the bidding war.  Thus, most likely resulting in an offer asking purchase price for the Seller.
• Weigh different loan terms vs cash terms to mitigate risk. Cash offers should be accompanied by proof of funds to demonstrate legitimately cash offers.
• Sellers should consider what the ideal price and terms are for their situation.  Many times, it is not just about the highest price – perhaps the Seller needs time to find a replacement property or some time to pack and move after closing – Buyers willing to provide a post-closing occupancy can help a Seller save time, stress, and money.
• Sellers should consider the merits of all the offers they receive especially those offers using VA loans – sometimes these buyers are dismissed by Sellers because the Seller assumes they’re using 100% financing because the buyer doesn’t have any down payment.  Many times that is just not the case and the buyer is just trying to take advantage of a benefit of serving in uniform.
• The first offer is not always the best, patience is needed.  Often times, an offer will come in the first day that requests a very short response time.  However, if the Seller wants the highest and best offer, it’s wise to let the house be shown for a few days to allow as many showings as possible.
• The highest offer is not always the best offer – other terms such as an appraisal waiver, type of loan, date of closing or rent-back should be considered.
• It’s important to consider the merits of the offer, not who is making the offer in order to avoid a discrimination suit
• It’s critical to vet the top few offers – we want to talk to the Buyer’s lender, view proof of funds if it’s a cash offer, and make sure we discuss any gray areas with the Buyer’s broker.
• You need to have a strategy for offer acceptance, and dates and deadlines as to when offers will be collected, reviewed and accepted.
• Focus on the big 3:  financial terms, dates and deadlines (to match up with your goals), and which contingencies are acceptable and mitigate your risk – all the other minor details are just noise.
• Understand you can accept an offer at any time for any reason, even if you have acceptance deadlines that say otherwise.
• Your agent should be able to help rank them according to financial terms, but the highest net is not always the best offer