Hot Housing Market Multiple Choice

Quick!  Guess which of the following variables — besides price — can be a tiebreaker for Sellers weighing multiple offers:

A. The Buyer’s type of financing.
B. The size of the Buyer’s down payment.
C. The Buyer’s lender (local, name brand > out-of-state and/or online).
D. The closing date.
E. The identity of the Buyer’s agent (and their reputation).
F. Any Buyer “pre-concessions” regarding either the Inspection Contingency or Financing Addendum.
G. The Buyer’s two cute kids and Golden Retriever (ideally, puppy).

Correct answer: “all of the above” (but, I wouldn’t rely too much on “G.”).

Here’s the explanation:

A. Most Sellers prefer what’s known as conventional financing rather than FHA, DVA, or other loan programs:  the Buyers are typically stronger financially, and there’s less red tape. Even better:  no financing (cash).

B. The higher the downpayment, the lower the mortgage’s loan-to-value ratio; the lower that ratio . . . the less appraisal risk.

C. Yeah, sure, that out-of-state lender is touting super low rates and negligible fees.

But, will the funds actually be there at closing?  Will the out-of-state lender be able to get the appraisal and underwriting completed by the contractual deadline?  Is there a human being that anyone can actually reach if any of the foregoing hiccups??

D. Sellers of vacant homes want fast closings; Sellers who don’t know where they’re headed, are building new construction, or remodeling their next home want a delayed closing.

E. Does the Buyer’s agent have a good reputation? Or, are they — or their clients — known for beating Sellers up during the inspection phase of the deal, nickling and diming over small issues, etc.

F.  To make their offers more attractive, some Buyers are now agreeing to limit their inspection requests, or, make up any difference if the appraisal comes in low.

G. Don’t know what look to go for?  Think, the models in the picture frames at Target . . .  🙂

See also, “(Some) Buyers in Multiple Offers Pull Their Punches. Or Do They??”; and “FOBH and 2017 Housing Market.”

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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