On one of my recent posts I explained why your low ball offer will be rejected. This time, we’ll flip the coin and look at how to increase your chances of having your offer accepted. If your intent is to buy a property with an FHA Loan, a 3.5% deposit and a 60 day escrow, let’s just say you have about as much of a chance of having your offer accepted as the likelihood of the no doc loan returning within our lifetime.

In an attempt at brevity some things were left out of last week’s article. Things to look for, if in fact you are intent on making an offer below asking price. That created a good opportunity to issue the sequel LOWBALL OFFER II. So with a little more in depth analysis, here are a few tips if you consider yourself a bottom feeder, and how to achieve your goal of buying a house below market value.

Kick em Below the Belt, Then Shake Their Hand

Mom, if you reading skip the next couple of paragraphs.

I remember when I was in the 7th and 8th grade. On a couple of occasions I was sent to the vice principals office for a couple of acts of disobedience where I received a couple of pops on my rear end. The device used looked like a giant stick you would use to stir paint. It was about 2 feet long and a half inch thick. The stinging from the blow was severe and if done today, the provider would find himself severely disciplined if not terminated and brought up on charges. That was a different time.

After the punishment was administered, the vice principal would shake my hand, as if to say we’re friends now and everything is forgiven. So how does this possibly apply to your situation and buying real estate?

The lesson here is after you make an offer well below the asking price and market value, you need to shake the seller’s hand and offer something in return. Immediately your low offer will convey that you are indeed the bad guy. Therefore how do you reverse that perception and show the seller that you intend to work with them.

Everything is Negotiable, Except Price &Terms

We used to joke that everything was negotiable with the exception of price and terms. What else is there other than price or terms? If you are predicating your entire offer on price, then you need to be flexible with terms. Here are some suggestions for increasing the odds your offer will be accepted:

1. Cash – the old adage that cash is king has never been more true. Cash shows intent and that you are serious. It also shows that if your offer is not accepted, you have ability to move on. Cash has finality to it that a loan application never will.
2. Escrow – does the seller need to close in 15 days to avoid foreclosure or 60 days in order to find a new place to live?
3. Release some Deposit Money- this one can be ill advised, so you will have to use your own judgment or seek counsel, but releasing some of the deposit may allow the seller the intermediate funds they need and the motivation to leave.
4. Remain in the House – again an iffy situation, but allowing a seller to remain in the property 30 – 45 days after escrow closes could seal the deal.

It can be hard to believe, but people do have motivations other than money. The key is finding out what their hot buttons are and how to effectively incorporate them into your offer and allow you to shake hands with the seller.

Tags: buy real estate below market value, low ball offers for real estate, real estate low ball offer