Help, All Of The Houses We Want Go Under Contract Before We Get A Chance To See Them!!

Dave,

We are currently looking for a new house here in the Grand Valley. Our budget is around $225,000 and it seems like every time we find a house we want to see, it’s under contract before we can even schedule a showing! What’s the deal with houses in our price range moving so fast? Do you have any advice on what we can do to find something we like before it goes under contract?

Thank you so much for your help!!

Mackenzie & John, Grand Junction

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Mackenzie & John,

Wow! Your observations are absolutely correct!  The segment of the market that you are searching in is moving at a very brisk pace and the competition can be fierce!  I had a property that I put on the market this week and had 3 offers on the first day and the winning bid was significantly over our asking price.   I sure did not see that coming!  However, situations like this are happening with more and more regularity so as a buyer, you must be ready and willing to put your best foot forward right out of the gate.  Don’t be afraid to compete!

There ARE some simple things that you can do to help move your offer up in the pecking order when the offers are presented to the seller!

1.      Be willing to offer more than asking price!  I have seen many an offer lost over $500 or $1000.  If you really want the property and there are multiple offers, go 1-2% over asking price and watch your chances soar!  If the home is $225k, offer $229k and my bet is you get it.

2.      Offer more earnest money than what the seller is requesting.  Earnest money is often times an overlooked negotiating tool that absolutely DOES mean something to a seller and can tip the scales if the offer prices are similar.

3.      Be flexible with the closing and possession date.  This will show the seller that you are willing to work with them and make the transition fit their needs. 

4.      Be willing to cover your own or at least part of your own closing costs.  Over 80% of the offers we see contain seller paid closing costs.  Eliminating these closing costs indicates to a seller that you are a stronger buyer.   After 15 years and thousands of contracts negotiated, it is a fact that most sellers don’t like paying the buyers closing costs.

5.      Do not ask for personal property or things that the seller is not offering as inclusions with the property.  If they have not included the nice new looking refrigerator, don’t ask for it.  If you find their lawn furniture comfy don’t try to throw it in, go buy your own.  I have yet to find a seller who looks upon request for personal property with a favorable eye. 

6.      Be willing to waive your inspection contingency!  If you do this, it will be clear to the seller that you are making a serious offer and have serious intent to purchase the home.  This is a last resort move, however, it is a doozy if you have confidence that the property is in good condition.

These are several techniques to help you up your game in this increasingly more competitive real estate market.  Notice that none of these are high dollar techniques or anything really fancy, but I promise they will make a difference and if you combine 2 or 3 of these in the same offer you will probably have an unbeatable combination.  Remember sometimes it takes a little courage, faith and risk to get what you want so don’t let fear or hesitation hold you back from making things happen.  When you craft your offer with your agent, look at it through the eyes of a seller, be willing to think outside of the box and create a win/win for both parties and I bet you have a new home in no time at all.  I’ll bet the next time you submit an offer, it will be FUN!  Good luck.

Dave Kimbrough

The Kimbrough Team 

Can You Explain What Exactly Title Work Is?

Dear Dave,

            We are in the process of selling our home and will be purchasing a new one.  Right after we listed our property for sale, we received title work from our agent on our home.  Can you explain what exactly title work is?  We were told that we need to review it, but what should we be looking for on the property we are selling?  When we purchase, what should we look for on the title work for the new property – anything different we should look for or the same stuff?  Thank you for your help.

Dennis, Grand Junction

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Dennis,

This really is a great question and a part of the buy/sell process that is far too often glossed over.  It is glossed over, because most of the time people and agents do not know how to answer your question thoroughly and with command of the specifics of what you are looking for.  I am very lucky to work closely with Bob Reece, President of Advanced Title, who is one of the very best real estate experts I know and knows title work inside and out!  I have relayed you question to Bob, to ensure you get the best possible explanation!

"Title work" is really the title commitment and the documents that are referenced in the title commitment such as protective covenants. The commitment outlines the current status of title interests in the property such as the name of the owner(s), any lender and other interests such as easements holders, and the commitment gives sellers and buyers the opportunity to review the title to the property before the closing occurs. The seller should compare the deed with which they acquired ownership to the property with their name(s) as it appears on the title commitment to make sure it is the same. A similar comparison for the legal description is essential. The third area of the commitment are the Exceptions to Coverage that lists various protective covenants, easements, agreements, reservations, etc. that affect the property. These items should compare favorably to the exceptions that appeared in the title policy that was issued when the seller originally acquired the property. And, by example, any easements granted by the seller should also appear as an Exception to Coverage on the title commitment. Any discrepancies found by the seller should be disclosed to his real estate agent as soon as possible and prior to closing so a buyer becomes fully aware of the matters that affect the property being purchased.

A buyer would be wise to review a title commitment in similar fashion; to make sure their names properly appear on the title commitment as found under the real estate contract and on any lender application; that the legal description matches the one found on the seller's acquisition deed; and to review the documents referenced as Exceptions to Coverage to make sure they understand any obligations, restrictions to usage or third-party rights that affect the property about to be purchased.

As Bob intimates, your title review is a very important part of the process, as it lays out virtually everything you need to know about your property and the property you are going to purchase.  Your rights and the rights of others should be spelled out in your title work and thus leave few things, hopefully, to chance.  It is always sound advice to ask questions about ANYTHING you do not understand.

I hope this helps and remember if there are any discrepancies make sure to bring them to the attention of your agent or the title company that has provided the title information so they can be addressed and remedied if need be.  Best of luck selling and buying!

Dave Kimbrough

The Kimbrough Team

What exactly is title work?

Dear Dave,

We are in the process of selling our home and will be purchasing a new one. Right after we listed our property for sale, we received title work from our agent on our home. Can you explain what exactly title work is? We were told that we need to review it, but what should we be looking for on the property we are selling? When we purchase, what should we look for on the title work for the new property – anything different we should look for or the same stuff? Thank you for your help.

Dennis, Grand Junction

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Dennis,

This really is a great question and a part of the buy/sell process that is far too often glossed over. It is glossed over, because most of the time people and agents do not know how to answer your question thoroughly and with command of the specifics of what you are looking for. I am very lucky to work closely with Bob Reece, President of Advanced Title, who is one of the very best real estate experts I know and knows title work inside and out! I have relayed your question to Bob, to ensure you get the best possible explanation!

"Title work" is really the title commitment and the documents that are referenced in the title commitment such as protective covenants. The commitment outlines the current status of title interests in the property such as the name of the owner(s), any lender and other interests such as easements holders, and the commitment gives sellers and buyers the opportunity to review the title to the property before the closing occurs. The seller should compare the deed with which they acquired ownership to the property with their name(s) as it appears on the title commitment to make sure it is the same. A similar comparison for the legal description is essential. The third area of the commitment are the Exceptions to Coverage that lists various protective covenants, easements, agreements, reservations, etc. that affect the property. These items should compare favorably to the exceptions that appeared in the title policy that was issued when the seller originally acquired the property. And, by example, any easements granted by the seller should also appear as an Exception to Coverage on the title commitment. Any discrepancies found by the seller should be disclosed to his real estate agent as soon as possible and prior to closing so a buyer becomes fully aware of the matters that affect the property being purchased.

A buyer would be wise to review a title commitment in similar fashion; to make sure their names properly appear on the title commitment as found under the real estate contract and on any lender application; that the legal description matches the one found on the seller's acquisition deed; and to review the documents referenced as Exceptions to Coverage to make sure they understand any obligations, restrictions to usage or third-party rights that affect the property about to be purchased.

“Your rights and the rights of others should be spelled out in your title work and thus leave few things, hopefully, to chance.”

As Bob intimates, your title review is a very important part of the process, as it lays out virtually everything you need to know about your property and the property you are going to purchase. Your rights and the rights of others should be spelled out in your title work and thus leave few things, hopefully, to chance.  It is always sound advice to ask questions about ANYTHING you do not understand.

I hope this helps and remember if there are any discrepancies make sure to bring them to the attention of your agent or the title company that has provided the title information so they can be addressed and remedied if need be. Best of luck selling and buying!

Dave Kimbrough
The Kimbrough Team