Selling a Home?  Learn and Save Money, Stress and Headache!  Part 4

Using my  aggressive marketing and pricing your home at the right list price will give your home maximum exposure to buyers... We are going to receive offers!

We can do a little happy dance but the big celebration comes later.

Picture provided by Martin

RECEIVING OFFERS

There are two ways we can set up the marketing that will determine how we receive offers:

  1. Ask the buyers to submit their Highest and Best offer on their first offer because we will not be countering… Or
  2. Not mention it and then send a multiple counter to all offers

These are the pros and cons for each.

Ask the buyers to submit their Highest and Best offer on their first offer…

PROS:  

  • We get their highest and best offer right off the bat
  • We only have to review offers once and you can make a decision sooner

CONS:

  • Some, if not all, of the buyers may be willing to go higher on their offer

Not mention it and then send a multiple counter to all offers

PROS:

  • We can play each buyer off of each other and potentially get the highest offer with the best terms

CONS:

  • We have to review offers 2 or more times
  • It will take longer for you to make a decision

No matter what, we are going to look at ALL offers - no matter the price.

Buyers sometimes like to test the sellers.  We are going to counter ALL offers. 

GOING OVER THE OFFERS

There is nothing much worse than getting multiple good offers, then select one that turns out to be a dud.  Then go back to the other offers and the buyer has already found another home.

Ouch!

Don't get caught taking an offer that's a dud!  Review each one carefully!

Photo by Emergency Brake

How do we avoid that?

We can't... At least not all the time.

We don’t have a crystal ball, so we won’t be able to avoid some things.  Some things will happen that are out of our hands.  However, there are steps we can take to assure the best chance of getting the best offer that will actually close.

Ways to avoid the pitfalls of selecting the wrong offer:

  • Pay attention and make sure we understand the type of loan the buyer has
  • If the buyer is using a special loan program, find out more about that program and its qualifications.  Be very careful with special loan programs that are new and not proven.
  • With special programs, make sure the buyer has reserve funds to cover if anything were to go sideways on the loan.
  • We may need to ask for an increased deposit from that type of buyer and make the terms easy for us to receive those funds, if the buyer/loan shows signs of loan trouble 
  • Send them a Notice to Perform asap so, they either perform or we get out of the contract and put the property back on the market
  • Keep all contingency timelines and removals tight
  • ALWAYS have the buyer be prequalified through our favorite lender who can tell us how solid the buyer really is - especially if they have a special loan program.

Let me repeat - once there are signs of things falling apart, give them a Notice to Perform and get out of the transaction as quickly as possible.  

We will not play that game!

Once we find out there something not right from the buyer's side, we will send out a Notice to Perform right away to find out if we're moving forward or not.  We will NOT be playing that game.

Photo by Jim Larrison

CONSIDER YOUR TIMELINE AND BOTTOMLINE

When we go through the offers, price is important, since that determines your bottomline.  However, terms in the contract can also affect you bottomline, as well as your moving timeline.  

Consider too, if you already have a place to move to or will you need a replacement property.  (This should already been discussed during the initial interview and our marketing of the property will reflect this as well.)

Here are some questions we need to ask and look for in each offer:

  • Will the offer allow you to achieve your moving date?
  • Will you need to rent-back from the buyer after closing in order for you to completely move out?  Or have you already planned with a moving company to move you asap and do you have a place to go?
  • Will the offer NET you what you want or need?
  • Do you have any concerns about the offer’s terms and conditions?
  • If we ordered the inspections ahead of time we would know if the property needs repairs or not - and how much.  If so, will the offer give you enough to be able to do the repairs and still net you what you want or need?

Of course we would like to receive an offer that would net you as much as possible.  However, we have to be careful that the offer price is not too high that the property won’t appraise at that price.  This will cause us issues in the middle of the transaction, which could cause the transaction to fall apart.

So, what do we do?

If we get a high offer like that, we will ask the buyer to let us know what they plan to do, if the appraisal comes in much lower than their offer price.

  1. Do they plan on coming up with the difference?
  2. Will their agent  assist them or a family member?
  3. Do they expect you, the seller, to come down in price?
  4. Do they plan on coming up with SOME of the difference (up to a certain amount), but not the full amount?

Knowing these ahead of time will help us make a decision on that particular offer.

GO OVER OFFERS - SOME MORE

Other terms that we need to review and look for are:

  • Asking for credit towards their closing costs
  • Asking for your appliances.  The stove, microwave and dishwasher stay, but refrigerators, wine fridge, washer & dryers and even furniture can be negotiated.
  • Who pays for title insurance, escrow and other 3rd party fees
  • Asking for Home Warranty, etc

“Wow!  There is a lot to go over in the contract.” they both said and I agreed.

ACCEPTING AN OFFER AND OPENING ESCROW 

Once we accept an offer, the clock starts ticking because time is of the essence.  There are timelines in the contract.  Therefore, let’s get a jump on the things we can control - from our end.

  1. Open escrow with the title company and send them a copy of your mortgage payoff info
  2. Send the buyer’s agent your disclosures (we have 10 days typically, but we’ll send them the disclosures within 2 or 3 days or sooner, if they’re ready.
  3. Order items to be repaired, if they have already been repaired,
  4. Make sure you have smoke detectors in every bedroom close to the door, as well as another one in the hallway.
  5. Make sure you have carbon monoxide detectors on every level of the home
  6. Make sure their inspector will have access to the attic, crawl space (if there is one), the electrical panel 
  7. Test the AC and heating units as well as the thermostat and make sure they work
  8. Test all of the burners on the stove, as well as the oven and make sure they’re working

And a host of other things to make the inspector’s and appraiser’s job easier, thus making the entire transaction smoother.

REPAIRS AND CREDITS

I am always in favor of ordering the inspections ahead of time and if possible, go ahead and repair those items. 

If you decided not to do the repairs, at least in the beginning, we’ll already know if the buyer will want the repairs done or not.  By negotiating all of this in advance, you’ll have a better idea how much you’re walking away with and we’ll know how smooth the rest of the transaction is going to go.

However, if you decide not to order the inspections, then they will order their own and we get a copy of it.  If we make sure that everything is in working order ahead of time, the reports will be cleaner and the buyer may not ask for as many items to be repaired, which is good for your bottomline.

Also, if they do ask for repairs, depending on their lender’s guidelines, we can offer them credit for the amount of the repairs and let the buyer take care of those items when they move in.

GETTING READY TO MOVE

Moving day.   Picture provided by Bill McChesney

You should have already removed as many items as possible out of the property to make it in showing condition.  However, this would be a good time to start packing the rest of the items so you won’t be stressed later.

In the meantime, I’ll stay in constant contact with the buyer’s lender to make sure everything is going well with the buyer’s loan.

SIGNING and CLOSING

Most of the time, your closing paperwork will be ready before the buyer’s papers.  So, we can set up your signing ahead of time. 

Typically, once the buyer signs their closing paperwork, it takes 2 to 3 days to finalize the transaction and you get your funds.  However, if can be as quick as a day, so make sure you’re all packed and ready to go once we close.

Although, you typically have until around 5 pm or 6 to be completely moved out on the day of recording....  Unless it was negotiated in advance that you have a rent-back for a certain amount of time, then you can stay up to the day negotiated on the contract.

It helps to plan in advance.

WHAT TO LEAVE AT THE PROPERTY

Leave all keys (front door and mailbox, etc), remote controls, warranties and owner’s guide to appliances and any other paperwork we need to give to the new owner.

I’ll leave the front door key in my lockbox for the buyer’s agent to take and give to the new owner. 

“Nice.  We are both looking forward to that day.” Cersei said.

Buckle up.  It will be here before you know it!

Go Back to Part 1      Part 2      Part 3

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About the author: All of the articles in this site were written and provided by Rico Castillo (DRE# 01234643) with Coldwell Banker.  If any information is provided by another source, such as the local MLS or by Metrolist, then a disclaimer will be on that page.

Rico can be reached by cell at (916) 934-3146 or email at rico.castillo@cbnorcal.com.   Visit his YouTube Channel at https://bit.ly/3bAaZJs

My aim is always 100% client satisfaction by helping you accomplish your real estate goals and finding you the home you've Dreamed about in the area you and your family can feel proud and safe to live in!