Opinion: Why a higher offer is not always the best offer, by Joe Fisher.

By Joe L. Fisher

Why isn’t the highest offer always the best offer?

The housing market is a whirlwind! Because this is a seller’s market, purchasers will compete in whatever manner they can to become the owners of the listed homes. Every bidder makes the finest offer they can to the potential sellers, which they think is enticing and exceptional. Offering the greatest home price is one of the most perfect and enticing offers for buyers, but is it the best offer? Certainly not! Every seller has distinct objectives, and there are many other factors to consider besides the price when making an offer. Homeowners engage with their brokers to determine the best offer depending on their goal and urgency to sell, as well as the market conditions and more so, tend to establish the motive of their prospective buyers. As said by Jeff Samuels, a regional manager for Northern California at Agency, “The key is to help the seller look at the whole picture for each offer—not just price, but all the terms, and also the perceived eagerness of that buyer.”

REASONS THE HIGHEST OFFER MAY NOT BE THE BEST OFFER

Non-cash payment- One of the most common reasons for contract failure is non-cash payment financing. If the buyer is unable to obtain a mortgage, they will be forced to terminate the deal. This takes the seller back to square one when it comes to selling their home, which costs them money and time. This implies the vendor will have to start all over again. No seller wants to be in this uncomfortable scenario, thus they prefer all cash payments because they don’t have to wait for mortgage documentation. For customers who require a rapid closing due to school or work relocation, the mortgage payments form may not be an appealing option. Because it provides a guarantee to the seller and because most purchasers cannot afford it, an all-cash offer is favorable.

Lack of pre-approval letter- Although it isn’t required, being mortgage pre-approved, might provide a buyer a noticeable advantage in such a competitive market. A pre-approval letter informs the seller that the buyer has met with a lender and has been approved for a

mortgage. If the buyer doesn’t show the letters, the seller assumes they don’t have their finances in order, thus the sale isn’t certain to close. Buyers may not be able to purchase the house even if they make the greatest offer.

Inflexible Timeline - the closing date may be more essential than the home price offer in some cases. Some sellers may prioritize a rapid sale above a high price for a variety of reasons, including cash flow or relocation. Even if the highest offer is made, a buyer who is unable to meet these deadlines will lose the property. On the other hand, the seller may not be in a hurry to leave for a variety of reasons. The buyer should wait until the deadline has passed. If the buyer is in a hurry to buy, it is a turn-off to the seller, and even if the buyer offers the highest price, the buyer may not be the best. The more rigid a buyer is, the less appealing the deal gets.

Too many contingency- sellers see contingencies as a disadvantage, so an offer with the fewest possible contingencies is more enticing. Some contingencies are important, and waiving the ones that aren’t is the best approach to make the offer stand out. This will encourage vendors to consider the offer over the best possible price.

With the heated up market condition, money is not everything as sellers are looking for the ‘highest and best offer’ Most Buyers make the mistake of bidding with the highest offer and end up not affording to pay in the name of becoming the outstanding buyer. The best way to avoid such risks is to work with a qualified real estate agent. They know exactly what the seller wants and help you work through your strategies. Make your offer appealing without having to go through financial strains, by heading on to The Power Is Now Media Inc. We are the best realtor company for all your real estate investment. Joel Fisher, a VIP agent in Richmond can guide you in the best ways to strategically place your offer and be the seller’s best choice.

ABOUT JOE FISHER

Joe Fisher has worked as a First Time Home Buyer Specialist and realtor since 1998. Having served on the CCAR Board of Directors as President and Vice President. He is the President of the Coronado Neighborhood Council, a member of the Richmond Chamber of Commerce Board of Directors, the Richmond Convention Visiting Bureau Board of Directors, and the Richmond Convention Visiting Bureau Board of Directors.

ABOUT THE POWER IS NOW MEDIA INC.

The Power Is Now Media Inc. is an advocate for the empowerment of the minority communities all around the United States. We engage in various thoughts of leaders to make sure that you are equipped with knowledge about our economy. We have partnered with First Bank to provide you with products and services that will help you prepare better for the future. We are also advocating for first-time home buyers. The Power Is Now Media Inc. can help make your home ownership dream a reality. Go to www. neverrentagain.com and get started today.

Eric Lawrence Frazier MBA, Vice President and Mortgage Advisor of First Bank, NMLS 461807. President and CEO of The Power Is Now Media Inc. www.thepowerisnow.com

References: https://www.trulia.com/blog/5-reasons-the-highest-offer-wont-always-get-youthe-house/ https://www.mansionglobal.com/articles/in-a-frenzied-market-the-highest-offermay-not-be-the-best-one-2 https://www.upnest.com/1/post/do-sellers-always-accept-the-highest-offer/