Terri Haklin has not received any gifts yet
I like to prepare my clients and customers for the Buying or Selling process. It is important for you to understand that properties in good condition in get picked over very quickly because the inventory is still very low. Do not be surprised to see a property in a desirable area, in good condition and priced to sell go under contract and get taken off the market the same day it was listed.
It is also important for Buyers and Sellers to understand that because we are in a sellers' market with low inventory, Buyers who are assuming a mortgage have very little negotiating power; especially if they are up against a cash Buyer. Cash Buyers are also frustrated because their offers do not have the leverage they would in a buyers' market. In this Sellers' Market, Sellers are less likely to back off their original asking price because they know they are most likely going to get multiple offers at the Sellers' asking and sometimes, at over asking price.
What does this mean to the Buyer? If the Buyer is assuming a mortgage and has a financing contingency in their offer and there is a multiple offer situation, the Buyer needs to be prepared that they may not get the property, especially if they are up against a cash offer at asking price with a four week closing; even if the Buyer assuming the mortgage offered more than the Sellers' asking price.
This brings me to a very important point. Offering more than what the Seller is asking. What does that mean to the Buyer? If the Buyer offers more than asking and they are assuming a mortgage, they risk the appraisal coming in under what was offered. This means that without an Appraisal Contingency, the Buyer would be responsible for coming up with the cash for anything over the appraisal amount because the mortgage company will not loan for more than the appraisal. Let us say the Buyer was advised well by their agent and adds an Appraisal Contingency to their over asking price offer, the Seller most likely will reject the offer due to the risk to the Seller.
What do I mean, "Risk to the Seller"? If the Seller is in a multiple offer situation, the Buyer with the highest offer is not necessarily going to be the Buyer with the best offer. If the buyers' offer includes an Appraisal Contingency and the appraisal comes in below what the buyer offered, the Buyer can walk away from the deal and the Seller never gets to the closing table. The Seller must re-list their property because most likely, the buyers from the first round of offers have already found new properties. The Seller has lost precious time and new Buyers question why the property is back on the marker. Consider all variables before accepting a final offer. This is where a good Realtor guidance and advise is necessary.
I have a firm understanding what is going on in the market and I can help both Buyers and Sellers navigate and come out a winner. I am a US Army Veteran with the work ethic and discipline of a soldier. Now instead of providing service to my country, I service my clients and customers. I look forward to serving you and your real estate needs!
Last Update 6/7/16