Questions Sellers should ask before Accepting an Offer
There are a few key questions that every seller should ask before accepting a Buyer’s offer. The answer can show if the buyer is highly motivated to purchase. You can decide if it’s worth seriously negotiating with that buyer and making a counteroffer if the initial purchase offer isn’t acceptable.
Does the buyer have Mortgage Pre-Approval?
A pre-approved home buyer is highly motivated to buy. It is a confirmation that they are able to afford the asking price and helps close deals faster.
Is the buyer a cash buyer?
Cash sales close faster and are advantageous to the seller. Some sellers also offer discounts to cash buyers. But this may require you to pay out your existing mortgage and there may be an interest penalty for doing this. Remember that having to pay an interest penalty effectively reduces the price you will be receiving for your home
Does the Buyer need Mortgage Contingency?
A “mortgage contingency clause” is a provision in the home purchase contract that says that if the prospective buyer can’t get a mortgage within a fixed period of time, they can call the whole deal off. In other words, the agreement is conditional on the buyer being able to obtain a mortgage on the property. This can help decide if the seller wants to accept the offer.
Does the Buyer have to sell another home before buying?
If the buyer needs to sell before buying, this can lead to delays and financing issues. They may plan to use the proceeds from sale of an existing home to pay for the new one. You may either reject the offer or only allow a short period of time to place it under agreement.
Other questions include
What is your time frame for buying a home?
What price range do you want to work within?
Is their credit good?
These questions can help analyze the buyer’s offer and the risks that may or may not be associated with it. Then, if you decide to accept an offer you will do so feeling confident that the buyer will be able to secure financing and close the deal.