What is the highest and best offer? When a Seller receives multiple offers on their property, usually they will ask all interested Buyers to submit the highest and best offer by a particular time and date. The idea is that this is the highest amount the Buyer is willing to pay with the best terms possible. Usually, there is no additional negotiation other than perhaps asking the Buyer to change a closing date so interested Buyers should offer the maximum amount of money they are willing to pay for the property.
How do you put together the highest and best offer? There is a lot more than just purchase price in the highest and best offer. Here are some other items you need to consider when putting together this offer as well as strategies to help you win in the highest and best offer situation:
- Get your real estate team (your REALTOR® and Lender) on the same page to ensure a smooth transaction, particularly your Lender. You don’t want to find out that you can’t qualify for the amount of money you’re offering if you go above the list price.
- Mortgage pre-approval: if you’re using a mortgage, make sure you have an up-to-date pre-approval, which will be submitted with your offer.
- Flexibility: if possible, try to have a short closing day (30 days or less with a mortgage and 14 days or less with cash) unless the Sellers have a specific closing date in mind and limit your contingencies (i.e., if you have a house to sell before this purchase). The cleaner the offer, the higher your chance of having your offer accepted.
- Don’t be too picky: Sellers want to work with a straightforward Buyer. Talk with your REALTOR® and come up with reasonable requests. For instance, we don’t suggest asking for a home warranty if you’re in a multiple-offer situation.
- Consider A Pass/Fail Inspection, it means you do an inspection but won’t ask the Sellers to make any repairs. You agree to buy the property “As-Is”. After the inspection, you can still decide to walk away if you are not comfortable with the inspection results, but you won’t ask the Sellers to fix anything if you choose to move forward with the purchase.
- Have your Lender call the Seller’s Broker and assure them that you are a highly qualified Buyer and won’t have any issues qualifying for the Loan.
- Write a Seller love letter telling the Seller about yourself and why this is the perfect home for you.
- Consider a price escalation addendum.
Why do Sellers ask for the highest and best offer? It gives all bidders an equal opportunity to have their offer considered, and it shows how committed a Buyer really is.
Questions? Contact us at andi@andidyer(dot)com or 360-734-6479.
This content is not the product of the National Association of REALTORS®, and may not reflect NAR’s viewpoint or position on these topics and NAR does not verify the accuracy of the content.
Copyright © 2024 Andi Dyer and Sterling Real Estate Group. All rights reserved.
Leave a Reply