Two Plus Two Publishing LLC Two Plus Two Publishing LLC
 

Go Back   Two Plus Two Poker Forums > >

Notices

Business, Finance, and Investing Making money, investing in markets, and running businesses

View Poll Results: Which offer should I accept?
Offer 1 - 207k 3 30.00%
Offer 2 - 210k 7 70.00%
Voters: 10. You may not vote on this poll

Reply
 
Thread Tools Display Modes
Old 07-08-2017, 07:22 PM   #1
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Selling house: which offer to accept?

House is a 2 bedroom, 1 bath 900 sq ft home in a great neighborhood in Minneapolis. 1.5 days after listing house at $200k had open house. 26 groups showed up, and we got 4 offers that night.

The best two offers are as follows:

1. $207k. No financing or appraisal contingency (if financing isn't obtained I'm supposed to get the earnest money.). Normal inspection contingency. Buyer asks for 0 closing costs. Close in 6 weeks. 20% down. $5,000 earnest money. Buyer appears to be a married 55 yr old woman who owns a boutique business and is buying on her own. Possible divorce? Sale is contingent on selling her home, but she's already accepted an offer for $420k and passed inspection.

2. $210k. No financing or appraisal contingency (if financing isn't obtained I'm supposed to get the earnest money.) Buyer 'waives right to renegotiate based on inspection except for major structural issues'. Buyer asks for 0 closing costs. Close in 4.5 weeks. 3% down. $1,000 earnest money. Buyer is a single 30 year old woman who works in marketing.

My uneducated guess is that the appraisal will come in between 200k and 210k. I'll guess $204k. I bought for $170k in 2014 and did about $12k of renovations - mostly a bathroom remodel. House was built in the early 1900s. It's in good shape and looks nice. Biggest known issues with the house are:

-original windows that aren't in great shape
-non-urgent exterior issues with yard/retaining walls/detached garage

Last edited by willie24; 07-08-2017 at 07:31 PM.
willie24 is offline   Reply With Quote
Old 07-08-2017, 08:24 PM   #2
Pokabandito
enthusiast
 
Join Date: Oct 2007
Posts: 98
Re: Selling house: which offer to accept?

If buyer 2 has qualified for the Fannie/Freddie first time buyer 97% conventional loan, don't see a reason not to take the higher amount. Just ask for proof of a pre-qual letter.

Buyer 1 is obviously serious due to the earnest money and the down payment, but you never know what can go wrong with the contingency around their home sale which can add incalculable risk. Also having the standard inspection contingency opens you up to higher risk they find an issue that allows them to pull out.

I'd go with Buyer 2.
Pokabandito is offline   Reply With Quote
Old 07-08-2017, 08:27 PM   #3
rand
veteran
 
rand's Avatar
 
Join Date: Feb 2007
Location: 314-oc
Posts: 3,424
Re: Selling house: which offer to accept?

Not an agent, not an attorney...

But the answer is obvious. Accept the 1st and then accept the second offer as a backup. You can do that...

At least in MO.
rand is offline   Reply With Quote
Old 07-08-2017, 08:59 PM   #4
rand
veteran
 
rand's Avatar
 
Join Date: Feb 2007
Location: 314-oc
Posts: 3,424
Re: Selling house: which offer to accept?

Also, I obviously have not read your contract. But typically in MO, in the case of offer 1, yes you get the earnest money. But that doesn't just mean that they are off the hook. If there is no financing contingency and they want financing but it is unapproved, their offer defaults to a cash offer.

So they are legally liable for the whole $270k. You will almost certainly have to sue to get anything more than the earnest money. But such is the way of the world.
rand is offline   Reply With Quote
Old 07-08-2017, 09:00 PM   #5
rand
veteran
 
rand's Avatar
 
Join Date: Feb 2007
Location: 314-oc
Posts: 3,424
Re: Selling house: which offer to accept?

Jesus, wtf. I read that as $270k twice now. Im done with this thread. Sorry that was so unhelpful.
rand is offline   Reply With Quote
Old 07-08-2017, 09:50 PM   #6
Go Get It
Carpal \'Tunnel
 
Join Date: Feb 2010
Location: Doesn't have a leg to stand on.
Posts: 11,261
Re: Selling house: which offer to accept?

OP do you have a new place to live already or does that not factor in here?

Also seems like option 1 imo. 3k after tax ins't too much imo.


Also, we all already knew this but, your house in my neighborhood would be worth less than half of what you're getting for it. And obv if it somehow was in NYC would be worth like 6x.
Go Get It is offline   Reply With Quote
Old 07-08-2017, 10:07 PM   #7
eastern motors
Carpal \'Tunnel
 
Join Date: Jun 2007
Location: Where your job is your credit
Posts: 8,889
Re: Selling house: which offer to accept?

I'd go with #1 or ask #2 to match earnest money. Too easy for #2 to walk away from $1k earnest money when the house appraises for only $200k.
eastern motors is offline   Reply With Quote
Old 07-08-2017, 11:00 PM   #8
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Re: Selling house: which offer to accept?

We have an offer accepted on a new house, closing in one week
willie24 is offline   Reply With Quote
Old 07-08-2017, 11:26 PM   #9
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Re: Selling house: which offer to accept?

Pokabandito - if she has the Fannie/Freddie 97% deal but the house doesn't appraise, does she have to come up with the difference in cash in order to close ?
willie24 is offline   Reply With Quote
Old 07-08-2017, 11:52 PM   #10
ArmChair
grinder
 
ArmChair's Avatar
 
Join Date: Aug 2007
Posts: 559
Re: Selling house: which offer to accept?

I would assume both offers are from prequalified buyers? In that case, I'd go with #2 assuming it's a Fannie/Freddie deal. I wouldn't be that concerned about the appraisal unless it was like 10%-ish off.


Sent from my iPhone using Tapatalk
ArmChair is offline   Reply With Quote
Old 07-08-2017, 11:59 PM   #11
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Re: Selling house: which offer to accept?

Quote:
Originally Posted by ArmChair View Post
I would assume both offers are from prequalified buyers? In that case, I'd go with #2 assuming it's a Fannie/Freddie deal. I wouldn't be that concerned about the appraisal unless it was like 10%-ish off.


Sent from my iPhone using Tapatalk
Explain. If the house appraises for $200k what happens?
willie24 is offline   Reply With Quote
Old 07-09-2017, 12:14 AM   #12
Pokabandito
enthusiast
 
Join Date: Oct 2007
Posts: 98
Re: Selling house: which offer to accept?

The LTV can't be higher than 97% of appraised value, so if appraisal comes in low buyer would be responsible for making up the difference.
Pokabandito is offline   Reply With Quote
Old 07-09-2017, 12:20 AM   #13
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Re: Selling house: which offer to accept?

And you guys don't think I should be worried that that buyer may have to come up with another $5-10k of cash?
willie24 is offline   Reply With Quote
Old 07-09-2017, 12:45 AM   #14
Pokabandito
enthusiast
 
Join Date: Oct 2007
Posts: 98
Re: Selling house: which offer to accept?

The buyer wants a quick close, has almost no contingencies, and put in an offer significantly higher than listing. I think they are likely a pretty serious first time buyer and can come up with the difference if they have to.
Pokabandito is offline   Reply With Quote
Old 07-09-2017, 12:21 PM   #15
ArmChair
grinder
 
ArmChair's Avatar
 
Join Date: Aug 2007
Posts: 559
Re: Selling house: which offer to accept?

Quote:
Originally Posted by Pokabandito View Post
The buyer wants a quick close, has almost no contingencies, and put in an offer significantly higher than listing. I think they are likely a pretty serious first time buyer and can come up with the difference if they have to.


Pretty much this, although my thought was more along the lines that appraisals have a tendency to run high compared to sale prices, at least in my experience.


Sent from my iPhone using Tapatalk
ArmChair is offline   Reply With Quote
Old 07-09-2017, 07:06 PM   #16
Jbrochu
Carpal \'Tunnel
 
Join Date: Jan 2005
Posts: 14,901
Re: Selling house: which offer to accept?

They do run high if the appraisers want to continue finding work in the future.
Jbrochu is online now   Reply With Quote
Old 07-09-2017, 09:21 PM   #17
stevepra
adept
 
stevepra's Avatar
 
Join Date: Jun 2008
Location: Tampa
Posts: 736
Re: Selling house: which offer to accept?

Quote:
Originally Posted by willie24 View Post
And you guys don't think I should be worried that that buyer may have to come up with another $5-10k of cash?
I generally assume a buyer putting down 3% won't have the extra 5-10k if the house doesn't appraise high enough.
stevepra is offline   Reply With Quote
Old 07-10-2017, 02:24 AM   #18
cstevens
adept
 
Join Date: Sep 2009
Posts: 915
Re: Selling house: which offer to accept?

i assume you have not already countered everyone and asked for best and final including removal of contingencies? if you haven't yet then do this first.
cstevens is offline   Reply With Quote
Old 07-10-2017, 07:13 AM   #19
willie24
Carpal \'Tunnel
 
Join Date: Aug 2004
Posts: 9,427
Re: Selling house: which offer to accept?

Cat - we had asked for final and best after the first two offers (both worst than these two) came in the afternoon of the open house day. We never countered anyone.

This actually happened a month ago. We took the $207k offer. We ended up paying about $1k towards inspection items, which was fine. The house did appraise at $207k or higher with no lender repairs required (though I didn't receive a copy and don't know the exact amount). Everything is looking good for closing.

After the appraisal came in I had second thoughts about rejecting the $210k offer. Clearly, I didn't and still don't know where it would have come in for her lender. It sounds like it was a close call and our decision was fine. But the more aggressive choice very well might have worked out. Thanks for the input everyone
willie24 is offline   Reply With Quote
Old 07-10-2017, 08:59 AM   #20
Mihkel05
veteran
 
Join Date: Jul 2015
Posts: 3,421
Re: Selling house: which offer to accept?

I would've snap taken the 2nd. Quicker close and less hassles with the closing. The $ amount is negligible.

I didn't read everything, but seems like your entire worry was that this woman wouldn't be able to come up with a few dimes more to close? (When she already is willing to shell out 5-10k for the actual closing?)
Mihkel05 is offline   Reply With Quote

Reply
      

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off


Forum Jump


All times are GMT -4. The time now is 10:51 AM.


Powered by vBulletin®
Copyright ©2000 - 2017, Jelsoft Enterprises Ltd.
Copyright ę 2008-2010, Two Plus Two Interactive
 
 
Poker Players - Streaming Live Online