Professional agents can be extremely helpful in determining:
- Opening prices
- Assessing relevant information
- Negotiation strategy and tactics
To really gain some insight into what price range is acceptable to sellers and how they might proceed in the negotiations, it is important to know as much about the seller as possible, including their motivation for selling. Once again, the seller's agent can only disclose this information with the seller's approval; however it is your right to ask for this information even though a seller does not have to disclose their reasons for selling.
Negotiation Factors
Negotiable Items
Potential Purchasing Contingencies
Negotiation Process
Negotiation Factors
- Are they moving up or down the housing scale?
- Are they moving to a better location?
- Are the sellers divorcing or making a career change? They may want out quickly.
- Estate sales often yield a bargain in return for a fast sell.
- Every month a vacant house remains unsold represents considerable extra expense for the seller.
Negotiable Items
You know the old saying "Everything is negotiable!". Keep that in mind throughout the negotiations. Many things are negotiable and often times are negotiated during the purchase of a home including:
- Buyer's closing costs
- Contingencies
- Home protection policy
- Inclusions
- Inspection costs
- Points to the buyer's lender
- Possession
- Repairs required by the lender
- Repairs that need to be done
- Survey
- Termite inspection
- Terms
Talk to your real estate agent about all the negotiation possibilities to ensure you get the best deal available.
Potential Purchasing Contingencies
- The buyer must first obtain specific financing from a lender
- A home inspection report must be obtained and all the details must be clearly detailed in the written contract
Negotiation Process
Your agent can save you time and money by representing you through the offer, negotiation, and acceptance process. They will review the written offer with you to make sure that you thoroughly understand the purchase, terms, and conditions of the sellers offering. They will help you understand the issues and how you are affected. Your agent's primary responsibility is to protect your best interests throughout the negotiations and should have the knowledge and expertise necessary to make sure that you receive the best price and terms available.
- The negotiation process starts with a written offer
- Each time either party makes any change in the terms, the other side is free to accept, reject, or counter again. A counter offer is actually a rejection of the original offer and presentation of a new offer.
- A written offer becomes a binding contract when it is signed unconditionally by both parties without any changes.
- An offer can be rescinded up until the moment it is accepted, or even in some cases, if you have not yet been notified of acceptance
- The offer becomes a binding contract as soon as you are notified of acceptance
- At this point a deposit (earnest money) will generally be made to make an offer on a house
- If you want to revoke your offer, be sure to do so only after consulting a lawyer who is experienced in real estate matters. You do not want to lose your earnest money deposit, or find yourself being sued for damages the seller may have suffered by relying on your actions.
Once you have made an offer to purchase a home, your real estate agent will inform you of all the procedures, timeframes, and responsible parties in order to proceed successfully to closing. For example, the property may need to be formally appraised, surveyed, inspected or repaired. Depending on the specifics reached during the negotiations, you may pay for some, all, or none of these items.
Your agent will coordinate with all the parties involved and keep you informed as to the results of the various procedures. If each procedure returns acceptable results as defined by the contract, then the sale continues. Occasionally issues arise during certain phases prior to the close such as during the inspection or title search. The terms of the contract will dictate your options. Your agent will advise you throughout this process and to help ensure your interests are protected.
There are some sales that go smoothly and some that require a lot of work to get to the closing table. Until you get into it, you will not know which one you have on your hands. Either way, your agent will be there with you every step of the way.
The key to a successful negotiation is to keep in mind that the end result must make both you and the seller happy. Otherwise, negative feelings will persist throughout the remainder of the process and someone may walk away feeling that they were not treated fairly. Keep in mind throughout this process that many people are personally attached to the home they may be selling and try to keep emotions at bay. A win-win situation is always best and sometimes requires compromise from both parties involved.
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