Is it a Good Offer?

You’ll hear everyone talk about offers, it was a good offer, it was a bad offer.  What exactly makes an offer good or bad? There is no magic formula or criteria, but there are several things you can look at.  So many offers are going around in the Phoenix Real Estate market and to make it a really good offer, you have to understand both parties to the transaction.  An offer is good, but is the offer any good? A review of a few items to keep an eye on.

1. One of the first things to check is where is the money coming from?

Cash buyers pose the least amount of risk, they are rare offers.  Most offers will use a financing element, the larger the downpayment, the lower the risk.  Are terms in line with market standards?  How does the loan officer feel about getting the loan?  Are there other options in case that loan type goes away?  Are there special conditions in order to qualify?  Such as length of ownership, condition of the home.

2. Why did the buyer pick this property?

This can be hard to determine in any detail, but is the home being purchased as an owner-occupied, second home or investor home is often outlined in the offer in settle ways.  Owner-occupied represents the most emotionally involved and least likely to walk away at the first sign of a problem.  The investor is at the other end of the spectrum.

3. Additional contingencies?

There are always contingencies, inspection, title, loan.  The one that adds risk is if the buyer is depending on selling their home in order to qualify to purchase your home.  This one contingency carries a lot of risk with it.

4. What other terms are included in the offer?

While these aren’t necessarily a risk to closing the deal, they can change the bottom line in many different ways.  Are they asking for contributions at closing?  Carry-backs or other financing options?

If the offer provides more of what you want over less of what you don’t want, you can consider it a good offer.  Always remain focused on the first objective, selling your home.

Related posts:

1. If you have Multiple Offers, what should you do?
2. Do I need to be Pre-Qualified to make an Offer?
3. Making an Offer
4. Sometimes I do too good a job
5. Why do I and other agents require an LSR?