Counter Offers On Real Estate Purchase Contracts
This Article Is About Home Buyers With Counter Offers On Real Estate Purchase
The housing market has been booming for the past several years. Home prices have been increasing double digits for the past several years. Both HUD and the Federal Housing Finance Agency (FHFA) have been increasing FHA and Conforming Loan Limits for the past five years due to rising home prices. There is more demand for housing versus inventory. Therefore, homes are selling higher than the list price. This has been a major problem for homebuyers. Many home buyers are being squeezed out of the housing market.
Counter Offers And What It Takes To Get The Winning Bid
Counter offers happen after a home buyer submits an offer on the home that is below the listed price of the home. The seller counters back with a price that is lower than the listed price but higher than the buyer’s initial offer.
A counter is usually given when the home seller will accept the home buyer’s purchase offer contingent upon the following terms and conditions. Higher purchase price than the initial purchase price offered by the home buyer. But lower than the listed price of the property. Closing date considerations and closing terms. For example, a seller may want a fast closing or exclude the appliances. The potential increase of earnest money and shorter contingency periods. For example, the seller may want the home inspection period and mortgage contingency period shortened. The seller may also want to counter to the home buyer for a larger earnest money deposit. There are many things that the seller can counter with.
Sellers Counter Offer
When a seller counteroffers with a lower price than the home is listed from the initial purchase offer, buyers can counter-offer back to the seller with a higher purchase price than they originally offered but lower than what the seller counter-offered. Counteroffers can go back and forth until a mutual price is agreed on between both parties.
No Counter Offers
When homebuyers submit a low ball real estate purchase offer, some sellers will not respond back with a counteroffer. The seller may also not respond back with a counter offer and demand the full listing price. Properties with multiple offers normally go into a bidding war. The seller does not have to counter offer on every single offer the seller gets. The seller can review the multiple offers and decide to counter offer the home buyer of the seller’s choice. The seller will await the home bidder’s response before he or she might counter a different offer. Not every real estate purchase offer needs to be countered by the seller. The seller can pick and choose which contract offer is best and will counter that particular contract. Once the seller’s counteroffer is accepted by the home buyer than a deal is struck by both parties.
Price Is Not The Only Counter Offers Attractive To Sellers
The biggest fear for home sellers is that the home buyer’s lender will give the buyer a last-minute mortgage denial and the seller cannot close on their home. This is the exact reason why home sellers prefer cash buyers or home buyers with no mortgage contingencies. All pre-approvals issued by Gustan Cho Associates are full credit approvals that have been fully underwritten and signed off by our mortgage underwriters. In a sense, it is like a cash offer to sellers. There are many instances where home sellers will take a lower offer on their home with a TBD PROPERTY UNDERWRITE MORTGAGE APPROVAL than a pre-approval letter issued by a loan officer. Not all pre-approval letters are created equal. This is why all pre-approvals issued by Gustan Cho Associates close. We do not just close our borrowers’ loans but close them on time.
Home Buyers who need to qualify for a mortgage with a national direct lender with no overlays, please contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us at [email protected] The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. We have a national reputation for not having any lender overlays on government and conventional loans. We also are experts in non-QM and alternative financing mortgage loan programs. Gustan Cho Associates has dozens of lending partnerships with non-QM wholesale mortgage lenders.