Terms Matter!

Winning in multiple bid situations is tough, but you can stack the percentages of success in your favor with the right plan. We recently had a buyer client win in a multiple bid situation because she was willing to pay (relatively) the same amount as the next highest bid, but she pulled all the right levers with the terms of the agreement. Ultimately, success was achieved because she was willing to offer the best set of terms.

 So, what are terms can you offer to increase your chances of success?

1.     Escalation Clause – You can offer a price on the home, but put a clause stating you will pay X dollars more than the highest bid UP UNTIL a certain dollar amount.

• Example: “We are willing to offer you $335,000, but will pay $2,000 more than any other offer up until $350,000.”

2.     Appraisal Gap Coverage – The escalation clause is only as good as the appraisal gap coverage, so don’t miss this step! In a nutshell, you are stating you will come to closing with extra cash if the home appraises for less than the sale price.

• Example: “In the case of a lower appraisal amount, we will bring $5,000 in extra funds to closing.”

3.     Written Statement – Have this one week before closing, but specify that if the seller doesn’t receive a written statement by that date the seller can call off the sale and retain the earnest money. MOST offers have the buyer retaining the earnest money, so this is another way the seller feels confident you are the right buyer to work with.

These summaries and examples are meant to be concise, so talking in depth with our team to understand it further is important. At the core, we want to put you in a position to win in multiple bids on your dream home! Reach out to Dan and Mary today to put yourself on the path to success!