As a real estate agent, one of your key responsibilities is to negotiate offers on behalf of your clients. While multiple offers may seem like a dream come true, choosing which offer to accept can be a daunting task. In this blog post, we’ll discuss how to evaluate and compare offers to help you make the best decision for your client.
Analyze the offer price
The first and foremost consideration while choosing the right offer is to look into the offer price. Analytical handling of the offer price may drive you to accept or reject an offer. Compare the offer price with similar properties in the same area and evaluate whether it’s reasonable or not. If the offer is too low, you need to decide whether to counter-offer or reject the offer altogether.
Check the Contingencies
Contingencies are the ‘what if’ clauses that give the buyer the option to back out of the deal under specific circumstances. There could be multiple contingencies listed in the offer, including those related to financing, inspection, and appraisal. You should evaluate each contingency’s likelihood of occurrence and how they may impact on the transaction before recommending your client to accept the bid.
Determine the Buyer’s Financing
Understanding the buyer’s financial strength is important while selecting the right offer. Cash offers are always the best, but not everyone can afford to pay in cash. Check whether the buyer has been pre-approved for a home loan by a reputable lender. A pre-approval letter is a strong indication that financing will not be a problem, and the deal is more likely to close.
Consider the Proposed Closing Date
The closing date is the day when the transaction is officially completed, and the buyer takes ownership of the property. As a real estate agent, it’s your responsibility to evaluate the proposed closing date and ensure it aligns with your client’s needs. Is the closing date realistic, or does it need to be pushed back? Be sure to communicate with all parties involved and iron out any issues before agreeing to the proposed date.
Evaluate the Buyer’s Deposit
A deposit shows the buyer’s commitment to buying the property. Typically, the higher the deposit, the more serious the buyer is and the lower the risk of backing out of the deal. However, be cautious of deposits that are too high or ask for an unreasonable transaction.
Evaluating and comparing offers takes time and careful consideration. As a seasoned real estate agent, you must use your expertise to guide your clients through this process. By considering the price, contingencies, financing, closing date, and deposit, you’ll be able to help your clients choose the right bid for their property. In the end, your professional advice can make all the difference in a successful transaction.