You Received Multiple Offers on Your Home. Now What?
Receiving multiple offers can be exciting for a home seller, but it can also make the decision-making process more complicated.
Offers can differ in much more than price. Financing, contingencies, closing dates, requested credits and other terms can all affect how a transaction moves forward. Understanding those pieces can help you have a more informed conversation with your REALTOR® as you consider your options.
First, Decide What Matters Most to You
Before comparing offers, think about your priorities for the sale.
Are you focused on your overall proceeds? Do you need to close by a certain date? Would additional time in the home make your move easier? Are there other timing or financial considerations that are especially important to you?
Your priorities can help shape how you and your REALTOR® review the offers you receive. From purchase price and financing to contingencies and closing dates, each term can affect the transaction differently.
Understanding what those terms mean is an important first step. Your REALTOR® can then help you consider how they relate to what matters most for your sale.
Understanding Purchase Price
Purchase price is often the first number sellers notice, especially when several offers are competing for the same home.
It is one part of the overall offer. Other financial terms, including credits or costs requested by the buyer, may also affect the seller’s estimated proceeds.
If maximizing your proceeds is an important goal, your REALTOR® can help you understand how the different financial pieces of each offer work together.
Understanding Financing
An offer will typically indicate how the buyer plans to purchase the home.
Some buyers use a mortgage, while others may make a cash offer. Buyers using financing may also submit documentation from a lender showing that they have completed certain preliminary steps in the mortgage process.
Different types of financing can involve different requirements, timelines and steps before closing. Your REALTOR® can explain the financing terms in each offer and how they may relate to your preferred timeline or other priorities.
Understanding Contingencies
A contingency is a condition included in a real estate contract that generally must be satisfied for the transaction to continue under the agreed terms.
Common contingencies can involve financing, an appraisal, an inspection or other circumstances related to the transaction.
The wording, deadlines and effect of a contingency can vary. Your REALTOR® and real estate attorney can help you understand what each contingency means and how it could affect the timing or progression of your sale.
Understanding Closing Costs, Credits and Other Financial Terms
Purchase price may not be the only financial component of an offer.
A buyer might request a seller credit or ask the seller to cover certain costs associated with the transaction. These terms can affect the seller’s estimated proceeds even when two offers have similar purchase prices.
Your REALTOR® can help you understand the financial components of each offer and how they fit with your goals for the sale.
Understanding Earnest Money
Earnest money is money a buyer provides as part of the purchase agreement to demonstrate their commitment to the transaction.
Offers may include different earnest money amounts, deadlines and terms governing how those funds are handled. The rules surrounding earnest money can also depend on the contract and circumstances of the transaction.
Your REALTOR® and real estate attorney can explain how earnest money is addressed in the offers you receive and what those terms mean for your sale.
Understanding Closing and Possession Dates
Offers may propose different dates for closing or possession of the property.
Timing can be especially important if you are coordinating another home purchase, planning a move or need to remain in the property for a certain period.
If your schedule is one of your priorities, these dates may become an important part of the conversation. Your REALTOR® can help you compare the proposed timelines and explain any additional terms related to when ownership or possession transfers.
Understanding Offer Deadlines
In a multiple-offer situation, buyers may include deadlines indicating how long their offer will remain available.
A seller may also decide, with guidance from their REALTOR®, to establish a deadline for buyers to submit or revise offers.
Because several deadlines may be involved at once, your REALTOR® can help keep track of the timing and communicate with buyers’ representatives on your behalf.
Understanding Counteroffers and Negotiations
A seller does not always accept or reject an offer exactly as it was submitted. In some situations, the seller may propose different terms through a counteroffer.
Negotiations can involve price, dates, contingencies or other provisions of the agreement. This can give sellers an opportunity to discuss terms that may better fit their priorities.
Your REALTOR® can explain your negotiating options, while your real estate attorney can advise you on legal and contractual questions.
A Note About Fair Housing
Fair housing laws apply throughout the home-selling process, including when a seller receives multiple offers.
Decisions should focus on the terms of the transaction rather than personal characteristics of prospective buyers. Personal letters, photographs or other materials submitted with an offer may reveal information related to characteristics protected under fair housing laws.
Your REALTOR® can help keep the offer process focused on objective transaction terms and explain fair housing considerations that may arise.
Understanding the Full Offer
Before you list your home and potentially receive multiple offers, it’s important for you to understand how these terms apply to an active real estate sale and how they relate to the priorities you identified at the beginning of the process.
One offer may differ from another in price, financing, contingencies, timing or several other ways. Those differences can mean different things depending on your circumstances.
Your REALTOR® can help you understand each offer, answer questions about the process and work with your real estate attorney and other professionals as needed. If you are selling a home in Chicago, working with a REALTOR® who understands your local market can help you make an informed decision and navigate the process through closing.
