Updated: Sep 16, 2020
Awesome! We have received the first offer on your property. We’ll carefully review the details together, and I’ll help you evaluate the strengths, weaknesses and potential liability of the offer. A few important points to pay attention to while reviewing the offer include:
What price do you want for your property? How much do you need to sell the property for? Do you have an outstanding loan on the property that would need to be paid off?
At the Oregon Coast, it’s typically taking 30-45 days after contract acceptance to close a transaction. If the buyer is paying cash for the purchase, closing times may be greatly reduced. When considering the specific closing date for your property, we’ll need to discuss where you’ll go next if you’re relocating and any other major to-dos that would need to occur before closing. Depending on the details of your specific situation, it may make sense to negotiate an agreement for you to occupy the house after closing in some cases.
In this area, it’s typical to see earnest money deposits around 1% of the purchase price. Some buyers may offer more or less, though. Remember, earnest money remains refundable to buyer’s until after they’re removed all the contingencies in the sale agreement.
Financing Type & Down Payment
Depending on the type of loan product the buyer will be using, down payments will vary from 0% down payment to 20% or more. As with earnest money deposits, a larger down payment typically indicates a more financially-able buyer, however there are many additional ways we can do our due diligence on the buyer’s qualifications. It’s also important to know that different loan programs may have different requirements for your home’s physical condition. and these should be considered before accepting any given offer. For example, a house with peeling or chipping paint wouldn’t qualify for VA financing.
Closing Cost Credits
For first time buyers or those with limited cash reserves, it’s not uncommon to receive requests for closing cost credits. This enables buyers to finance a portion of their closing costs with less of a financial burden out of pocket. How does this affect your bottom line? For example, if a buyer offers $400,000 for your home with a $5,000 closing cost credit, the net income to you as the seller would be $395,000.
Buyers have the option to ask you to pay for a home warranty, which typically costs between $350-550, depending on the provider and product. If you agree to pay for the home warranty on behalf of a buyer, the cost of the warranty would be deducted from your sales proceeds at closing.
Personal Property & Exclusions
Personal property is anything not permanently affixed to the property, and sometimes buyers request to have personal property items included in the sale. Some examples of personal property include free-standing refrigerators, washers & dryers, planters. Fixtures are anything permanently attached to the property, and fixtures are always included in the sale of the home unless specifically noted as being excluded on the sale agreement. Examples of fixtures include window coverings & hardware, lighting fixtures, and any plants or trees planted in the ground. When it all comes down to it, everything needs to be very clearly spelled out in the sale agreement regarding what is or is not included in the sale.
Is the buyer needing to sell their home in order to purchase yours? Any other financial contingencies? We’ll talk through all these concerns and come up with the best plan of action.
If you are interested in reviewing all the details included in the Sale Agreement in advance, reach out to me and I'll be happy to provide a sample.
With any offer, you have the option to accept the offer as written, reject the offer, or make a counter offer, which means you’re accepting some terms and making adjustments to others. Once we have discussed all the details and decided on a course of action, I will send you applicable documents for signature. All signatures throughout the sale process are obtained using DocuSign, which is an online program that enables clients to sign electronically from the convenience of their computer or smart phone. Time is of the essence in responding in writing to offers as they’re presented, so please make yourself available to sign documents in a timely manner.
It’s very important to remain flexible and patient throughout the negotiation process. Sometimes an offer is accepted quickly and without any changes. Sometimes, we will go back and forth with the Buyer multiple times during as many weeks. You and I will continue to discuss what is most important to you and how we can be flexible to help both parties ‘win’. My best advice during this stressful time is for you to relax, take a deep breath, and be patient.