The volatile real estate market comes with a lot of complications, and the same applies to real estate transactions as well. If you’re a seller trying to sell your home, refusing an offer on a home you are trying to sell can be a bittersweet feeling. On the one hand, you might have been very anxious to sell your home and start cashing in the check, on the other hand, you also do not want to sell your home for under its value or to the wrong people.
As you go through the process of selling, from listing to open house, you would get a lot of offers, and not all of them would meet your expectations some are even less than pleasant and not even worth your time considering.
Why Would You Refuse An Offer?
It might sound absurd to some people, but why would you refuse an offer as a seller? We listed down a few common reasons below that can help you decide if your buyer’s offer is worth it.
- You were given a lowball offer that just won’t work for you. It can be because you still have a mortgage on the property that you need to pay off from the proceeds of the sale, or you have the money earmarked for something specific like the purchase of a new home if you’re relocating, upsizing, or even downsizing.
- The buyer has a questionable source of funding. It can be that they haven’t secured a pre-approval letter yet so chances are their mortgage application would be denied, or they were not able to save up enough money for a downpayment or have inconsistent employment. As the seller, you have the right to refuse an offer if you are doubtful if the buyer really has the capacity to pay.
- You received a better offer, and you’re trying to sell your home in one way or another because of financial reasons, so it just makes sense that as a seller you take the highest offer. In cases when this happens, you don’t even need to provide the potential buyer with the reason why you are refusing their offer.
How Do You Refuse An Offer?
Now if and when the potential buyers fall under either of the scenarios above, how exactly do you go about refusing the offer?
Sellers are not bound by anything in real estate that requires them to provide a reason why an offer is being rejected, provided that these are not discriminatory in nature. However, approaching this professionally ensures that you have a smooth transaction.
If you and the buyer are both represented by real estate agents then this should not create a problem in terms of communication. Nevertheless, whether you’re doing the transaction with the help of agents or not, communicating with the other party is the key. Always respond to an offer even if the answer is no and respond in a timely manner, we don’t want to leave potential buyers out there hanging.
You as the seller, are not obligated to counteroffer to all offers you receive. Counteroffers can be a powerful negotiating tool, but they have to be used correctly, this opens up the opportunity to negotiate with the buyer. You have to let the buyer know that you are open to negotiation but you’re not a pushover.
Meeting their price point halfway may be a bit extreme, but the easiest way to do this is to reduce your selling price a few notches. However, not all counter offers are monetary in value, you may what to think of offering them to avoid you losing out on money in the sale. Workarounds such as shorter escrow, contingencies, existing furniture and features in the home, and the like can be used and outlined in your counteroffer.
Whatever the circumstance may be, rejecting a buyer’s offer is a pickle no one wants to be in; but it’s a much better problem than not having any offers at all. Rejecting an offer is not an unusual scenario in real estate transactions. As a seller, you should not feel embarrassed as you try to broach this topic with your real estate agent and the buyer.