Five Warning Signs Your Purchase Offer May Be Headed For Trouble

By
Real Estate Agent with RE/MAX Elite 513.265.3004 www.LizTour.com SAL.2002007747

contract timeFive Warning Signs Your Purchase Offer May Be Headed For Trouble

Yeah!!!  We finally got that purchase offer on your home!  We've been working for this for months, BUT......

There may be some trouble getting these buyers all the way to an accepted agreement!  Why do we say that?  There are some warning signs right off the bat or early on during negotiations that are typical of trouble brewing.  Now we're not saying Last Rites on this offer, and we'll give it everything we've got to get this deal to the closing table for you, but here's some early warning signs of potential trouble:

  • The buyer's agent casually mentions that your offer is the FIFTH that the buyers have written.  We're sorry, but this is either code for "give us exactly what we want or we'll tell you where the sellers can stick it",  OR the buyers are VERY prone to cold feet, OR they don't care about the home, just getting a STEAL!  In any case, this doesn't create warm, fuzzy feelings does it?
  • The buyer's agent keeps saying "You know it's a buyer's market" when sending over an offer WELL below current market value AND asking for everything that's not nailed down.  Especially true when we've established that your neighborhood is heading up quickly.  If the agent doesn't recognize the market, chances are neither will the buyers.  They'll all be swearing you're grossly overpriced....and then see a few weeks later you got your price.
  • The contract is incomplete.  Sections aren't filled in, disclosures aren't included, no copy of the earnest money check.  Nothing against the buyers, but this is a bad sign that their agent might not be the most competent out there.  Negotiations can be tough enough without having to worry about whether or not the other side has a clue about how it's done.
  • Their response to your counter is almost identical to their first offer.  Now they may still come up to something that will work, but typically this indicates they're feeling good about their number and not likely to come up much.
  • Their preapproval letter, or the lack of one.  No preapproval letter at all?  Pot luck at this point.  Maybe they can qualify, maybe not.  Another hazardous sign?   None of us have ever heard of the bank granting the preapproval letter.  Again, it may be no big deal, but those preapproval letters that end in ".com" don't always bode well.  Always good to be able to stand in someone's office when there's a problem that needs resolved.

Now there are some factors here we can mitigate, others we can't.  You can trust if there's something that we COULD do, we'll do it.  And if this offer can't be saved?  You can bet we're marketing to the fullest to get you another offer!

Serving Warren County's residential real estate needs,

Liz and Bill aka BLiz

Posted by

REALTORS(S) Serving Warren County Ohio & Adjacent Areas

The Liz Spear Team of RE/MAX Elite
Elizabeth & William Spear
Ask for us by name if you visit the office!

EHO Two locations: Lebanon & Mason, OH
Liz direct:  513-265-3004
Bill direct: 513-520-5305     
Fax: 866-302-8418

MailTo:  LizSpear@Go-Concepts.com

Our Website:  www.LizTour.com

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Sandy McAlpine 10/13/2011 12:50 PM
  2. Winston Heverly 10/13/2011 10:56 PM
  3. Fred Griffin 10/20/2011 10:34 PM
Topic:
Home Selling
Location:
Ohio Warren County
Groups:
Active Rain Newbies
Advice for Sellers
Club Chaos
Realtors®
RE/MAX Active Rain Bloggers
Tags:
negotiating
selling a warren county home

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Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Rob, You're welcome!  Happy to help out our fellow Rainers :)

Oct 14, 2011 12:11 PM #132
Rainer
32,390
Patrick Henry
PMZ - Stockton, CA
PMZ

Great post. It is always good to read about things to look out for as well as not do them on the buyers side. I am amazed at what some people do.

Oct 14, 2011 03:37 PM #133
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Patrick, Any time you think you've seen it all, someone will pull a new stunt :)

Oct 14, 2011 03:59 PM #134
Rainmaker
281,904
Steven Pahl
Keller Williams Tampa Properties - Tampa, FL
Real Estate Consultant Tampa, FL 813-319-6423

What's the line from Kenny Rogers The Gambler, "Know when to hold em, know when to fold em!"  On the listing side, if the offer is incomplete, I will show it to the sellers, but my answer back to the Buyers agent is always "the seller  will consider your clients offer when we have the following completed paperwork per the MLS instructions,"

Oct 14, 2011 04:53 PM #135
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Steven, We'll start the negotiations without some of the peripheral paperwork if necessary, but we can't complete it.  First counter will also point out the missing documents needed to get the deal done.

Oct 14, 2011 05:15 PM #136
Rainer
120,913
Monique Ting
INET Realty Honolulu, HI - Honolulu, HI
S, e-PRO, SFR

Until either prices go low enough or rents increase a lot, we'll still be seeing these kind of "buyers" out there...

 

Oct 14, 2011 05:38 PM #137
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Monique, Can't blame them for trying....okay, maybe just a little bit!  Life is busy enough without someone just throwing out tons of offers to see what sticks.

Oct 14, 2011 05:40 PM #138
Rainer
212,805
Eugene Adan
Adan Properties, Carlsbad, CA (760) 720-9710 - Carlsbad, CA
Carlsbad Real Estate

Bliz,

Your post is hilarious.  Unfortunately, even with the numbers of agents dwindling, it's a common practice that happens all too frequently.  You think after awhile tighter offers would be submitted.

Oct 14, 2011 08:29 PM #139
Rainmaker
248,193
Michael Dagner
Brokers Guild Classic - Denver, CO
Your Denver Homes Realty Expert

Bliz, had most of these issues in an offer a few weeks ago.  The other agent even threatened to call my broker, in order to persuade me into doing business, on their terms.  Once they discovered we were only going to do it the right way, we never heard from them again. 

Oct 14, 2011 11:32 PM #140
Ambassador
501,304
Chris Alston
Chris Alston (Keller Williams Realty, Cupertino California) - Cupertino, CA
Silicon Valley, California

The 5th offer is kind of funny...  I soooo hear that...  AND the telling us it is a buyers market thing...  HAHAH!!  This post had me smiling...

:)

Oct 15, 2011 01:42 AM #141
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Eugene, You'd think so, but as long as buyers are of the mindset that anything goes, we'll keep seeing buyers more interested in steals over deals.

Michael, Funny that people have to be so resistant.  Just fill out the forms required per local practice.  It's not difficult, it's actually our job!

Chris, It's five days later, wonder if they've written #6 yet?? :)

Oct 15, 2011 07:48 AM #142
Rainer
9,900
Tyla Edwards
Keller Williams - Castro Valley, CA

I didn't think anyone sent in offers without pre-approvals or copies of the deposit check. Do agents really even look at offers without those and agency relationship disclosures and proof of deposit funds, I thought you hadto submit atleaset those items for someone to even look at an offer?

Oct 15, 2011 05:29 PM #143
Rainer
13,549
Katie Sweet
Watson Realty Corp. - Kissimmee, FL
Realtor - 863-990-5141 - Central Florida

I have to agree with all of your points except for maybe point 1.  Here in Florida there is a lot of compition for houses, especially those under $100,000.  I have a first time home buyer who we have made 6 offers and are currently looking for another to offer on.  All of her offers have been for market value or above and several have been for above asking.  There is just that much compitition.  2 of the offers the sellers dissapeared on the listing agents and it took a week or more for the agents to let me know this.  2 offers the listing agent did not let us know that they got other offers after ours and my buyer would have offered more had we known.  So yes in her case I tell the listing agent how many we have made so that they will please let me know if they are having trouble reaching their sellers or if they get other offers.

 

Oct 16, 2011 10:13 AM #144
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Tyla, They'll still look, and depending on the local contract, the preapproval letter may be okay to present after acceptance, and technically, earnest money is required in Ohio for an accepted contract, but it is the practice.

Katie, Just difference in local practices and conditions.  We've got minimal distressed properties in our immediate market, so chances are VERY strong that if a buyer is making offer after offer, they just may not be that serious about actually getting THIS particular home.  They're just looking for the steal, and that's the most important thing to them. 

Oct 16, 2011 10:18 AM #145
Rainmaker
284,270
Kasey & John Boles - Jon Gosche Real Estate
Jon Gosche Real Estate, Boise ID - Boise, ID
Boise, Meridian, Ada/Canyon/Gem/Boise Counties

Sometimes it is the buyer's 5th offer because they keep offering on multiple counter situations and losing and that could be a hint from the buyer agent to please get this one accepted :-)  Not that I would ever do that......  Good list! -Kasey

Oct 18, 2011 02:36 AM #146
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Kasey, But here's the thing, even if it's a hint that they'd like help getting that offer accepted, if they don't hit my seller's bottom line price at a minimum, their previous failed offers have no bearing. Multiple offer situations here are still pretty uncommon.

In this particular case, it wasn't a case of failing on five multiples, they just weren't offering enough to purchase the home.  Even when they asked for our bottom line price and it was countered, they still didn't come up.  Either they were never financially qualified to buy the home, or they're only out for a steal.  Either way, they've had to move on.

Oct 18, 2011 06:41 AM #147
Rainer
29,345
Jayson Holland
RE/MAX - Denver, CO
Jay Holland

All of those are good clues. Usually you can tell from a 5 min talk with the buyer's broker if they have a clue what they are doing or not. That makes a HUGE difference.

Nov 01, 2011 01:13 PM #148
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Jayson, It certainly helps when the buyer's agent knows the ropes....although we're often surprised how often even the experienced agents tell us WAY more than they should.

Nov 01, 2011 01:16 PM #149
Rainmaker
263,660
Wayne B. Pruner
Oregon First - Tigard, OR
Tigard Oregon Homes for Sale, Realtor, GRI

If you see any of that stuff, it's time to not let your Sellers get their hopes too high.

Sep 28, 2012 08:56 PM #150
Ambassador
1,511,393
Liz and Bill Spear
RE/MAX Elite 513.265.3004 www.LizTour.com - Mason, OH
RE/MAX Elite Warren County OH (Cincinnati/Dayton)

Wayne, They continue to be good warning signs a year after originally posting.

Sep 29, 2012 04:01 AM #151
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