Evaluating Offers on Your Charleston Home

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For most sellers, negotiating an incoming offer is a matter of settling on a price with the buyer. However, there is another aspect in negotiations that greatly impacts your home sale: the terms of the contract. Terms are equally as important as the sales price. Here are five things for you to consider while navigating the negotiation process. 

1. Make sure the buyer is pre-approved. If a buyer has a pre-approval from a reputable lender, you know whether or not the buyer can actually afford to purchase your house. 
2. Pay attention to the down payment. Lenders require appraisals on homes in order to equate the home value with the selling price. Unless the buyer has a significant down payment available, an unsatisfactory appraisal could cause the deal to fall through. Check to see how much money the buyer is able to put down, and add that amount to the loan to see if they equal the asking price. 
3. Does the buyer have an existing home to sell? This can be a problem for sellers, as these buyers usually want to include a contingency in the contract that absolves them from buying your home if their home fails to sell. This can wreak havoc on the sale of your property, as it requires you to leave the terms of your sale up to the success of another sale. It's best to avoid offers with existing home sale contingencies. 
4. Closing dates are crucial. If the buyer requests a closing date beyond 90 days, it might be time to reconsider the offer. Lenders have timing guidelines that allow a buyer 45 days to apply for a loan. Any closing period longer than 45 days leaves the seller in limbo. If a buyer cannot meet that 45 days, forego the offer. 
5. Look carefully at cash transactions. Although these are attractive to sellers, you need to make sure that the buyer has the cash. Ask your Realtor to verify the funds before you move on with the offer. Unless you know the cash is there, it's a better idea to move onto the next offer.

Negotiating can be tricky in today's market. If you have any questions, give us a call or send us an email. We would be happy to help you!