In a real estate transaction, typically negotiating is thought of as price. However, there are many other factors that can either aid or hinder your probability of getting the house you want for the price you’re willing to pay.
As a buyer, the most important item you can provide to flex your buying power muscles is a pre-qualification letter. No seller wants to take their home off of the market for weeks just to find out that the buyer doesn’t qualify for the purchase amount. Any savvy buyers agent would make sure their client has a pre-qualification letter before even beginning the house hunt.
MAKE A STRONG DEPOSIT.
Offers are normally accompanied by a “good faith” deposit that goes into an escrow account while the property is under contract. Contingencies on the contract protect your escrow deposit in case something arises during the contract period such as a cloud on the title, property appraisal not meeting the purchase price or a poor home inspection. Deposits are typically 1-2% of the purchase price. A larger deposit shows a seller you’re serious and committed to the process of buying the home.
KEEP INSPECTIONS SHORT.
Inspection periods fall under contract contingencies that allow buyers to negotiate repairs, a lower price, or terminate the contract altogether if the inspection report is unsatisfactory. 15 days is the typical length of an inspection period, keep it at 15 days or shorter to make your offer more appealing. For a seller, a long inspection period means the property is off market for an extended period of time without a guarantee that the sale will go through.
An “AS-IS” contract means the seller isn’t obligated to make repairs or pay for any items, however, the inspection period on an “AS-IS” contract also states, “If buyer determines, in buyers sole discretion, that the property is not acceptable to the buyer, the buyer may terminate the contract in writing before the end of the inspection period”. AS-IS contracts are basically a low-risk look behind the curtain of a home. Standard residential contracts are more difficult to negotiate repairs as a buyer because the contract has a certain amount built into the contract that the seller has allocated towards repairs.
When financing a property closing usually takes about 45 days, some lenders pride themselves on closing deals in as little as 30 days. A quick closing that isn’t contingent on the buyer selling their home is most desirable to a seller. Some buyers want to make the sale of their home a contingency for purchasing a new home but there is usually a “kick-out clause” meaning the seller can still accept another offer without that contingency.
As a buyer, having Realtor® representation is typically at no cost to you. Don’t walk through the buying process alone or depend on the listing agent of the home. A listing agent can only represent the transaction if they have both sides of the deal and can NOT represent the best interest of both sides. Be prepared, have your own representation that’s looking out for you! If you are in need of a Realtor®, call me! It would be my pleasure to serve you.