There is nothing more frustrating for a potential real estate buyers than rejected offers. After finally finding what they thought was the perfect property, their offer was turned down. In some cases, the sellers didn’t even make a counter offer.
Let’s look at some of the reasons for rejected offers.
The most obvious was that the amount offered was too low. And if it was a “low ball” offer, it’s common for the sellers to not only not respond with a counter offer, but if the buyer gets more realistic in the future the seller may be so turned off by the original low ball that this time around they also won’t take the new offer seriously.
Another reason to get rejected offers is the terms in the contract. If the buyer is trying to only put a low down payment with a large mortgage, it stands little chance against a competing substantial cash or all cash offer. Also, the buyer might want a time frame for closing that is not compatible with the seller’s plans. If one wants 30 days and the other 90 days, it won’t work. There has to be compromise or no deal!
Contract contingencies can also torpedo a bid. In today’s real estate market in Cape May County, a home selling contingency is pretty much out of the question. Few, if any, sellers are going to wait for a buyer to first sell their own home. Four or five months is too long for a seller to withhold offering their property to other prospective buyers.
Other deal killing contingencies include asking for too many items to be repaired either in the original contract or based on the home inspection report after the contract is signed. The home inspection is to ascertain structural or system defects, not little things like a scratch in the woodwork or a soiled carpet. The seller not only doesn’t want to do all of them, they may be offended with the nitpicking.
The final obstacle is the financing needed by the buyer. The seller is gambling that the buyer can really get that mortgage. A pre-qualification letter is nice, but there’s still uncertainty. The buyer needs to take the time before entering the process to get a full blown pre-approval. Now the seller knows exactly how much the bank will loan and they can feel at ease and accept the offer. That sure beats getting rejected offers!