Evaluating a Miami Home for Sale Offer

Receiving and evaluating an offer to buy or multiple offers on a home can be a confusing process for sellers.

Naturally, the inclination for sellers is to solely focus on price, but, there is something else. The quality of the contract terms is as important when evaluating a Miami Home for sale offer.  

Let's review certain terms of the Florida Realtors Residential Contract for Sale and Purchase. Below are key points Sellers should consider when reviewing an offer or multiple offers for a home for sale in Miami:

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Price

Do you know the current market value of your property?

Price is important but only part of the total offer package. Is the price similar to what buyers recently paid for comparative Miami homes for sale? How do you know? Do you have a Comparative Market Analysis (CMA) report of recent sales?  The market shifts in whole or in part in certain areas.  

Time For Acceptance Of Offer And Counter-Offers

The Time for Acceptance of Offer and Counteroffers is the time period allotted for seller and buyer to negotiate on price and terms.

Do you have enough time to evaluate the offer? 

Initial Deposit

How much is the initial deposit? A range of 1% to 5% of the purchase price is the typical range for a home for sale in Miami. 

Closing Date

Is the closing date realistic?  

Let’s assume the buyer is financing and the closing date is 20 days from the effective date. It is highly unlikely for Miami real estate to close in 20 days when financing. Typically, conventional financing takes 45-60 days and cash-only transactions less than 30 days. 

Will you have enough time to find a new place to live or move-out completely? 

Contingencies

Contingencies are stipulations (events) that must occur within a specified period of time.

The residential contract can be canceled if the contingency is not met. Under most circumstances, the contingency allows the buyer or seller the right to cancel without penalty or financial loss.  

Buyer Financing

There is a dramatic difference between a home buyer that is pre-qualified or pre-approved when evaluating an offer.

A pre-approval is granted after a lender verifies a buyer's credit, employment history and income. In order to obtain a pre approval letter, the buyer must provide two years’ tax returns and W-2, recent pay stubs, bank account statements and do a check credit.

A pre-qualification is an informal interview by lender with buyer regarding income and expenses without verification.  As a seller, which buyer would you prefer?

Cash Only Offer

Sellers like cash-only offers because under most circumstances it is quicker to close and puts money in the pocket sooner. A cash-only sale isn’t subject to the results of an appraisal or a financing contingency.

Is the proof of funds letter current (no more than 30 days old)? Which offer provides you a quick closing date?

Price Is Never Alone

Studies show that your first offer is usually the best you will receive. The likelihood of another offer decreases as your property sits on the market.  Know more reasons why homes don't sell…

Price is never alone. Your understanding and knowledge of the additional terms are crucial in assessing the quality of the offer you receive.  

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