Seller Agent said "multiple offers". What should I do?

[Squirl]

Originally Posted by HockeyDadof2

I agree. That's why I suggest adding a clause that the buyer will bring up to $x,xxx additional to closing if the home fails to appraise at or above the contract price. I think this strengthens the offer in this market.

I hope no one thought I was suggesting that the strategy of offering well over list price with the expectation that they could renegotiate when the appraisal comes in short is a good game plan. I find that practice to be pretty slimy. I would also think that any seller's agent worth their commission would see this and advise their sellers accordingly. The point I was making is that I have seen that happen more than once in recent months.

This happened to me on the 2nd home I ever sold. There were multiple offers and our buyer was the brother of his RE agent; offered waaaaay over asking and won the bid. But when appraisal came thru it was below asking and we were relocating to another state and went with the appraisal price. This was in Grand Island Nebraska in 1976 -- and the appraiser, I was always pretty certain, was in the hip pocket of the buyer's agent. Lesson learned early in my life as a home seller and home buyer.

[Rakin]

Originally Posted by Spree

>> If I had a listing in Coppell that had 5 offers I would insist the Buyer remove the appraisal contingency.<<

I was wondering about this. This would work if cash buyer but what about bank loan? Am I correct in saying that the bank will only loan what the house is appraised at? The buyer would have to cover the rest if the house is appraised lower than what the buyer offered and can be negotiated by the buyer?

We are getting ready to list our house - it will be hip pocket in a high demand, low inventory area. Not saying we will have multiple offers but it might be a possibility. I will ask our realtor about what is mentioned above.

Part of a good offer is the ability to put down a nice down payment. The Buyer would just have to put up additional funds or...

Say a buyer is putting 40% down. The house doesn't appraise by 5%... that would mean he's only putting 35% of the loan down. That still works well.

There is actually a box you can check that says the Contract is not contingent on Lender Requirements (Appraisals being one). This does not work for FHA loans, just conventional.

[Rakin]

Originally Posted by Squirl

This happened to me on the 2nd home I ever sold. There were multiple offers and our buyer was the brother of his RE agent; offered waaaaay over asking and won the bid. But when appraisal came thru it was below asking and we were relocating to another state and went with the appraisal price. This was in Grand Island Nebraska in 1976 -- and the appraiser, I was always pretty certain, was in the hip pocket of the buyer's agent. Lesson learned early in my life as a home seller and home buyer.

You also want to have in Special provisions that the Appraisal will be complete and communicated within 14-17 days to the seller.

A common trick of some people is to over bid and hope to renegotiate when the appraisal comes in low.
Removing that contingency removes that option.