Increasing the buyer's offer:
Resolve the non-price issues first:
Besides price, there are always items in the purchase offer that enter into the negotiations, such as dates, earnest money amount, contingencies, appliances included, closing costs, etc.
Some feel these other issues should be resolved before the price is addressed. Wrong. A negotiation that ends up focused on just price has the potential of producing a winner and a loser, setting the stage for a failed negotiation.
Having other issues allows for give and take. “I'll come down $2,000, but we want to keep our first born”. “We’ll meet your price but we feel it’s only fair if we have three days after closing to move out completely.” You get this, I get that.
Get stubborn buyers up in price
You reach a point where the buyers don't want to increase their offer. Say to them, “Well I guess we both need to think about it.”
If they don't get back to you in two days, call and say, “We really don’t want to go any lower and obviously you don't want to go any higher. We like you as buyers. We’ve thought about it and we are willing to split the difference with you.”
You come across like a very fair-minded person, reaching out to help make a deal work. If the other party balks, they will appear unreasonable.
This almost always works, but the two sides should be in striking distance (5 percent) of each other before this technique can be effective.
Get first time buyers up in price:
You may find buyers who are short on down payment money. First-time buyers with less than 10 percent down are common.
If they could put more money down, they could bid higher.
Creating money for these buyers:
During negotiations, let’s say you reach a brick wall: you want them to come up $3,000, but the new buyers simply can’t afford to go any higher in price. What to do?
Make a counter offer $5,000 higher than the amount they last bid, but offer to pay for $2,000 of their closing costs. Point out how this nets you the $3,000 more you need while it's like giving them $2,000 in cash. This credit of $2,000 will eliminate $2,000 of their closing expenses.
Extra money toward closing costs can help cover loan origination fees, title insurance, inspections, etc. Lenders will help structure this type of arrangement as long as it’s not such a high amount that it’ll put the appraisal in jeopardy.
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