Longboat Key, Florida | July 23rd, 2019 – Any offer received by our clients is where our team provides professional expertise in scrutinizing each purchase bid. Finding the right buyer and navigating the way toward a purchase contract agreement is a complicated process. Let’s take a look at some of the critical steps.
Insist on a written letter offer
In some cases, some buyers would ask their realtors to approach the agent of the seller first with an oral offer, to feel out the latter’s response before they commit anything in writing. From our viewpoint, though, we strongly recommend that from the beginning, all offers be presented in a purchase letter. Having that document at the outset is a good indication that you’re dealing with a serious buyer.
Examine if the buyer is qualified
It’s almost automatic for sellers to first consider the purchase price, but other factors are as critical. As a listing agent, our team helps seller check if a buyer is really qualified and the offer is fully documented.
One document that is a must in a buyer’s purchase offer is the preapproval letter from the lender. It’s necessary to make a comparison between the offer and the preapproval to ensure that the buyer is fully approved to borrow the amount needed for the purchase.
Scrutinize all contingencies
Besides the price bid and other basic information, most purchase contract offers already include certain contingencies for the deal to proceed. These events that must occur within a certain period of time need to be scrutinized too, because a seller may lose leverage in the transaction. Here are some contingencies we need to closely look into.
We need to ensure that the buyer holds enough cash to shell out extra money to closing if the appraisal comes out lower than expected. If not, the seller would have to cut the price or share with the buyer in covering the difference between the appraised value and the asking price. This situation likewise underscores the importance for sellers to get a buyer’s detailed financial statement which includes not only income, assets, and liabilities but also the cash amount on hand for the purchase.
A contingency of 21 days or less would be ideal. A buyer who makes a full-price offer but asks for 60 days or more to secure their financing would in effect be sending the seller to take the property off the market during that period. Under this scenario, it is almost certain that the buyer is still trying to figure out how to finance the purchase and, this long waiting game puts the seller at a disadvantage of missing out on other potential buyers.
There are many more interrelated factors to weigh in property purchase offers, whether you’re a seller or a buyer of a condo or a single family residence. Our Judy Kepecz-Hays team is just a call or an email away to provide you with a comprehensive roadmap on the tested ways of navigating the real estate market.
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