Why Choosing The HIGHEST Offer Could be a BIG MISTAKE!

With continued low housing inventory and lots of buyer demand, you are highly likely to field multiple offers on your home if you list it for sale. How do you choose the best offer?

You might think, "That's easy! Just choose the highest one!" Not so fast! Believe it or not the highest offer may not be the best offer to choose. It's important to take a close look at the terms, timing, financing and contingencies before making your final decision. Remember, once you are under contract, buyers have lots of ways to get out, but seller's don't. Here are some specific things to look at when reviewing multiple offers.

1. Timing: Does the suggested closing date meet your timeline or will it cause you to be homeless or have to move to a temporary place while you find your next home?

2. Financing: What type of financing does the buyer have? Are they paying cash or getting a loan? If they are getting a loan, what type of loan is it? Some loan types have stricter appraisal requirements, and sometimes may require repairs before they lend! This could cost you thousand of dollars!

3. Appraisal Contingency: Is the buyer offering to pay the difference if the appraisal comes in low? With so many bidding wars, many times the purchase price comes in lower then the purchase price. Since the lender will not lend higher than the appraised value. This means either the buyer has to pay the difference or the seller has to agree to lower the purchase price. So it's important to know what the buyer plans to do in this scenario and make sure to counter the terms in your favor.

4: Inspection Period: Most buyer's will want an inspection before they buy the home. In the inspection period, the buyer has the right to have an inspection done on the home then negotiate repairs according to the findings in the report. Although I would never recommend that the buyer's I represent waive their inspection period, there are many buyer's out there doing so because of the stiff competition. This could save you the hassle of re-entering negotiations and save you money!

So these are the type of things to think about when you are reviewing multiple offers. There are many other things to consider as well, but don't worry! Remember, I am always here to help you have a fun, empowered, informed real estate experience by guiding you every step of the way.