How does a seller pick the highest and best offer? So many people are talking about an overwhelming amount of showings when a house gets listed. And then the seller is asking for "highest and best". What does that even mean
Is there a difference between HIGHEST and BEST? Actually there is... You could have one or the other or BOTH.
If you're wondering how to get your OFFER ACCEPTED in today's climate, let me help you out.
FIRST AND FOREMOST You need a great REALTOR who knows how to compete in a multiple offer situation. After that... it's as easy as 1-2-3
1* You absolutely MUST have your pre-approval or proof of funds BEFORE you start your home search. You will need to submit this with your offer. And you don't want to start looking at houses without this because you certainly don't want to waste your time or your agents time to find out things are a little more complicated than you thought they would be. There are a lot of factors that go in to the offer that the lender must provide.
All of these questions are part of your pre-approval process and they are all part of the purchase agreement. Your agent can't fill in the blanks on the purchase agreement without these questions being answered.
Your agent can also help you CHOOSE a good LENDER. This is SUPER important. You want to choose a lender that answers their phone and is accessible when you need them. If you need help finding a lender, let me know. I can recommend several local lenders and help you choose the lender that fits best for you.
2* Make sure you're one of the first ones in the door when the listing goes active. I will set up a saved search that meets your criteria and you'll be the first to know when a listing goes active that meets your criteria. This is important because some home sellers are not allowing overlapping showings. So you need a buyers agent who can schedule a showing ASAP and make sure you're one of the first peoplee through the door.
3* Submit a STRONG offer! Long gone are the days of low-ball offers. When agents ask for your "Highest and Best", you need to make the strongest offer you are comfortable walking away from if your offer isn't accepted. Possession, earnest money, and closing time frame are just a few of the many conditions that may be important to the seller. I will communicate with the list agent to see what the sellers needs are. The "Highest Offer" isn't always the "Best Offer".
Hope this helps you get your offer accepted!
I see a lot of new listings in the MLS that maybe go in on Friday and say something like "Please submit all offers by 5pm on Monday". This was a great strategy maybe back in November. However, now that more and more houses are coming on the market, that might not be the best idea.
First of all, most buyers are under time constraints. They are looking at a house today because they most likely NEED to buy a house today. If they see it today and submit a GOOD offer today, you might want to negotiate with them or accept their offer.
Some buyers don't want to get into a bidding war. I've had buyers ask me to schedule showings and when I tell them the seller isn't reviewing offers for 3 days, 5 days, sometimes a week, they tell me not to even schedule.
Buyers will have time to retract their offer. I've been on both the buying and selling end of the buyer retracting their offer before the deadline. In my buyer's case it was because something better came on the market before the seller made a decision. In my sellers case we had 9 offers and before the deadline 3 of them retracted. Probably for the same reason.
A good strategy might be to just ask all buyers to submit their highest and best offer from the get-go and for the seller to accept a good offer swiftly so they don't lose a good buyer.
As a top selling agent I have managed many multiple offer situations. I've also had my buyers offers accepted in multiple offer situations. I'm a tough negotiator and as a full time agent, I've navigated a lot of contracts and taken the time to build relationships with other agents. That makes a big difference in a Seller's Market.