Making a Competitive Offer

Making an offer on a property is a complex coordination between asking for what you want and providing what a seller needs. It is a fine art. It is a dance between two parties looking to get everything they can from the other. When done well, the negotiation of an purchase agreement between two parties is a beautiful thing. You might think that it is all about price. Well, money is important, but there are several other factors that come into play. The focus here is to talk about what other terms and conditions might put a person in the best position to negotiate the best price.

Deposit
In order to have a binding agreement for the purchase of a property, there must be a Earnest Money Deposit. This money is a buyer's promise that they intend to purchase a piece of real estate. This money is held in a trust account by either a firm or a lawyer and applied as a credit to the buyer at closing. The typical deposit is 1% of purchase price for resales. A stronger than average deposit shows a seller a level of commitment that is higher than average--boosting a seller's confidence in a buyer.

Financing
A persons ability to come up with the money is one of the most crucial points of negotiating the sale of real estate. Being pre-qualified is a must. The type of financing and who is planning on financing the loan are crucial points these days too. Purchasing a property with cash is a great strength in a negotiating. However, at the end of the transaction--it is all cash to the seller. Therefore, there is some limitation to the strength of a cash offer. The point here is that the more danger that is perceived in a person's ability to get financing, the less likely a seller is to negotiate on other issues.

Inspections
Getting termite and structural/mechanical inspections on a property is fairly common. The goal is to make sure all the systems of a house and the structural components are working as designed. The negotiating of repairs is typically inversely proportionate to the amount of price negotiating on the front end. The more the seller comes down in price, the less likely they are to do repairs to a home--typically. The time frame of inspections and repairs are important elements that are often over-looked by buyers, but are important pieces of the purchase agreement.

Closing
Closing is the terminology for the exchange of keys and disbursing/paying for the purchase. Legally, Closing is the recording of the Deed and Deed of Trust (if applicable). The date of the closing is a negotiating point on the front end and is something that can be the difference between a good offer and a bad offer.

Ultimately, a offer to purchase a home is seen as by a seller as a calculated risk. The more risk involved in a transaction, the less comfortable they are in taking less money. The less risk, the more comfortable in negotiating. They goal is to provide offers that appear lucrative and safe at the same time being beneficial to your own desires and interest. Negotiating is best conducted by professionals who can look at a transaction as objectively as possible and push your interest in a manor that will ultimately bring you out on top. This being the reason why having a good real estate agent who is skilled at negotiating is one of the best things to have on your side.