When selling a property, thinking carefully before making any decisions during the offer process is essential. In this post, you will be given guidance on navigating the offer process so that you can make sound decisions based on thoughtful insights.
Receiving Offers and Responding Promptly
When your property is listed, interested buyers will hopefully submit offers shortly after. Each offer should include an expiration date, which gives you a limited amount of time to respond. In our quick-paced market, it’s best to react promptly—usually within a few hours of receiving the offer. Quickly addressing and recognizing offers demonstrates courteousness while maintaining the transaction’s current momentum.
When reviewing an offer as the seller, you have three choices: accept, reject, or counter it. Though you may be tempted to reject a low bid, consider a counteroffer. I’ve seen cases where this has resulted in an improved counter offer and a successful agreement even after a buyer initially proposed a price that was too low. By doing this, you demonstrate flexibility without devaluing your property by slightly adjusting your asking price.
Here are some common negotiation points that buyers and sellers often address:
Price: The purchase price is typically the most significant negotiation point. Both parties aim to reach a mutually acceptable price that reflects the property’s market value and meets their needs.
Closing date: The closing date refers to when the property’s ownership is transferred to the buyer. Negotiations may revolve around finding a suitable closing date that accommodates the needs of both parties, such as timing the sale with the purchase of a new home or relocation plans.
Contingencies: These stipulations must be satisfied for the contract to move forward. Common contingencies include inspections, financing, and the sale of the buyer’s existing property. Negotiations may involve determining the types and length of these contingencies to protect the interests of both parties.
Closing costs: Negotiations can occur regarding the allocation of closing costs between the buyer and seller. Both parties may seek to minimize their financial obligations by negotiating who pays for specific closing costs, such as title insurance, transfer taxes, or attorney fees.
Negotiating the Contract
It’s common for both buyer and seller to engage in a back-and-forth negotiation process. This negotiation focuses on various aspects of the contract, including price, closing details, dates, and earnest money. These negotiations allow both parties to address their concerns and find common ground, leading to a mutually beneficial agreement.
When negotiating, it is important to pay attention to the terms of the contract. The real estate contract forms used in our market are created by the board of realtors with the public in mind. These forms include attorney review clauses to protect everyone involved. Before signing any residential real estate contract in Illinois, make sure it has this clause. It allows for a complete review by an attorney after signing to ensure your interests are protected.
Multiple Offers: Making the Right Choice
When you receive multiple offers, it can be thrilling yet difficult to choose. As the seller, it’s vital to evaluate each offer meticulously and make a well-informed decision that aligns with your objectives. Here are a few tactics to keep in mind:
Choose one offer: You can accept one offer that stands out based on its terms, price, and buyer’s qualifications.
Reject all offers: If none of the offers satisfy your goals, you can let the buyers know they should come back with an offer that’s more aligned with your objectives.
Request final and best offers: Another approach is to ask all buyers to submit their final and best offers within a specified timeframe. This allows you to compare offers and choose the most favorable one.
Request terms: You may also consider providing guidance to each buyer regarding the best terms of their offer. This approach allows you to gauge their willingness to adjust their offer and potentially match or surpass competing bids. It is not illegal or unethical to inform other buyers of the terms of competing offers; however, there are risks associated with that approach.
When a seller receives multiple offers, it is crucial to assess each one thoroughly and make a well-informed decision. To select the most appropriate offer, sellers should take into account several factors, such as:
Price and terms: Compare the prices offered and evaluate the terms of each offer, such as financing contingencies, earnest money deposits, and other contractual details. Look for offers that align with your desired price and offer favorable terms.
Buyer qualifications: Assess the financial qualifications and credibility of each buyer. Consider their ability to secure financing and the strength of their pre-approval or proof of funds. A financially stable buyer can provide more certainty throughout the transaction.
Closing timeline: Evaluate the proposed closing dates in each offer and determine which one aligns best with your preferred timeframe. Consider any personal circumstances or commitments that may influence your desired closing timeline.
Contingencies: Review the contingencies outlined in each offer. Consider the number, type, and duration of contingencies and assess their impact on the transaction. Offers with fewer contingencies may be more attractive, but consider the risks of waiving essential protections.
As your broker, I will always be available to provide advice and direction. Ultimately, you are in control of the decisions regarding the home sale.
The Importance of Fairness and Long-Term Perspective
It’s important to treat all parties fairly and respectfully during the offer process. Remember that circumstances can change, even if you reject an offer initially, and you might need to reconsider the rejected party in the future.
In conclusion, the offer process requires thoughtful consideration, timely responses, and effective negotiation skills. You increase the likelihood of a successful sale by carefully evaluating each offer, leveraging negotiation opportunities, and treating all parties fairly. I will be here with you every step of the way. We’re here to help you navigate this exciting journey. You can always reach me at 773.865.5661 or ivona@ivonahomes.com.