Selling a home can be a very exciting process, especially as the offers start rolling in. But just because an offer comes in first doesn’t mean it’s the best one. The highest offer also does not always equate to the best offer either.
There are a number of factors and considerations you should keep in mind when reviewing offers for your house.
Payment Type: The first thing you should do when looking at offers is check out the payment type. Most buyers will not choose to purchase in cash, but offers that are all cash are often the safest offers since sellers don’t have to worry about loan approvals by banks.
Pre-Approval Status: Pre-approval is another important element to consider when selling a house. Essentially, a letter of pre-approval means a buyer will be able to get the loan they need to purchase your house.
This makes these types of offers safer (and stronger) than from people who are not pre-approved. Do keep in mind there’s a difference between pre-qualification and pre-approval.
Repairs: Your house might need some repairs, but maybe you don’t have the time or money to do them. This makes a buyer who is willing to do the work an attractive one when it comes to selling. Some buyers will ask you to fix things in the house, while others will want to do the work themselves.
Taking this into consideration can save you a lot of time and hassle when it comes to reviewing offers.
Additionally, some buyers will want you to take all the appliances, while others will want to use them. Items like refrigerators and washers can be expensive, so keep this in mind when it comes to reviewing offers.
Contingencies: A lot of offers will come with contingencies attached, which are a list of things that have to happen at certain times in order for the deal to actually go through. For the seller, fewer contingencies are always better, so it’s important to carefully review all contingencies in each offer.
More common ones include inspection, financing, and appraisal. Some buyers will put in a clause to back out of a deal if an inspection reveals too many problems, so be sure to read the fine print of each offer and weigh options accordingly.
Types of Loan: Buyers will probably come towards you with a variety of mortgages under their belt, and this can lead to very different circumstances for the seller. Conventional loans are popular because they are pretty simple, but some government-backed ones can get a bit complicated since they require specific approvals and repairs at times.
Make sure to keep the loan type in mind as you are reviewing offers, since this can add a lot of time and stress to the entire process.
Closing Timeline: When you are selling a home, you’re probably just
ready to get a deal done and move on to buying your new home. Buyers who come with all cash offers will probably then be the best bet for you, even if the price is a bit below other offers.
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However, if your plans somewhere else are not yet clear, then you might need an extended closing timeline with a buyer who is willing to take more time. This gives you more of a chance to prepare to buy a new home, and gives the buyer more of a chance to potentially find more money for their own expenses.
Overall, there are a number of things to keep in mind when reviewing offers for your home. Price does matter, and this might be the most important factor for you, but some offers come with a lot of risks that makes them more of a hassle, even if you are getting more money upfront.
Are you looking to buy or sell a home in San Diego County? Call the Reed Team today at 949-392-6400!