Just the beginning of the New Year and we’re already back into those unwelcome multiple offer calamities — so incredibly stressful on each hopeful Buyer and his/her agent. The winner often second guessing that he paid too much, the losers often regretting they hadn’t paid enough! Frequently the people with the biggest regrets are the unsuccessful agents.
See if this hint might help stack the cards in your Buyer’s favour next time you’re playing that high stakes multiple offer game.
Price is the obvious prime motivator. However, price doesn’t always trump everything, particularly when the difference between the offering prices of the top offers is not that substantial. Every savvy Seller should also have concerns about each potential Buyer’s covenant, i.e. his/her capability and capacity to be able to actually close the transaction. Granted, huge deposits go a long way towards alleviating those concerns but there are other easily employed strategies that will assist in proving that your Buyer’s offer is the right one for the Seller to consider accepting.
I think that simply making your offer firm is not enough to convince the Seller that your Buyer has a full understanding of all the inherent responsibilities and consequences of making an offer firm.
Our office has a clause in our Schedule B that addresses many key issues. I include our clause below. It says that the Buyer accepts responsibility for not including conditions in the offer. I like it because it also addresses the issue that the buyer further accepts responsibility for the price that he is offering.
Please feel free to use it.
Today’s hint, however, is not to use our clause when in multiple offers. It is to use a specific form. The form I am talking about is TREB and OREA’s Form 127, “Acknowledgement re: Condition(s) in Offer“.
I am convinced it can help sway a deal your way.
Click here to download the form: Acknowledgement re: Condition(s) in Offer
When completing it, I would not only check off the pertinent boxes, saying your Buyer does not need conditions for this, that, etc., but I would also draw a line beside each checked off box and go to the extent of having your Buyer client initial beside each individual declaration. Have your clients initial large! Great impact.
This tells the Seller (who, in multiples you may not even be given the opportunity to present your offer) that your Buyer has considered each of these individual declarations. That is much more effective than having these acknowledgements almost hidden when deeply buried into the back of any Schedule B. I must point out, however, that our clause is no less legally binding than the representations made in Form 127, but this form rams home to the Sellers that the Buyer has considered each individual representation and is very comfortable in highlighting his or her total comfort with same to the Seller. Instills confidence. I like that.
So did one of our Sellers. They were very impressed with the one agent in a multiple situation that included this form with his offer. (P.S. – he didn’t get the deal because his price was just not there. Interesting, however, that the Sellers wanted to be able to accept his offer and would have done so had he been close.)
Please also consider how much stronger a strategy completing this form in that manner is compared to crossing out conditions that had been written into the offer and then deleted during multiple offers to make the offer better. Even when crossed out, Sellers may still not be convinced that the Buyer doesn’t’ actually need the condition and infer the Buyers let the pressure of the moment give rise to taking the gamble of removing a condition that they had previously deemed necessary and really still required.
These are the subtleties that very frequently can and do make a difference as to which offer gets accepted.
When in multiples, why not utilize this form to have Sellers impressed with your offer?
I hope it helps you get the deal.
THE BUYER HEREBY ACKNOWLEDGES that prior to the signing and presentation of this Offer the Buyer has reviewed with his/her salesperson the Buyer’s need to include the following conditions into this Agreement and has also discussed the consequences to the Buyer if it is his/her decision not to include same: Condition pertaining to Buyer obtaining financing for the subject property; Condition pertaining to Buyer obtaining a building inspection or termite report of the subject property; Condition pertaining to the sale of the Buyer’s current property; and a Condition pertaining to the arranging of insurance on the real property. The Buyer acknowledges that he has relied entirely upon his own inspection and investigation with respect to quantity, quality and value of the property. Buyer hereby releases Sage Real Estate Ltd., Brokerage from any and all claims resulting from his/her decision not to include any or all of the above conditions in this agreement. The Buyer further acknowledges that a Seller Property Information Statement on the subject property may not be available. At such time as this Agreement becomes firm and binding the Buyer undertakes to complete all his/her obligations contained herein including completion of the agreement itself.