Setting out on the adventure of buying a home is exciting but also nerve-racking. Then comes the time to put in the offer, sit back, and wait to hear from the owner. What do you do when the offer is rejected?
First, don’t be too hard on yourself.
There are plenty of reasons for rejection, and even seemingly perfect offers can end up getting pitched. Here is a quick rundown of why some offers are rejected and steps to take afterward.
For starters, we’re in a hot market — as you probably already know. Generally, in a hot market with rapid sales, a buyer has an increased probability of seeing his or her offer rejected as sellers see an increased number of bids. Receiving a negative response to your offer can stem from many issues. Was the amount of earnest money or the bid too low? Was there a competing offer with a higher down payment or even a cash offer?
All these financial issues and more could have factored into the seller’s decision. It could also be something so simple as the owners decided to remain in the house for personal reasons or you asked for too many contingencies. Having such conditions is good because it shows seriousness. However, having too many contingencies may put more responsibility on the seller than he or she is willing to accept.
The first course of action is to understand why the offer was declined.
Follow up with the real estate agents involved or ask an expert to review the bid.
Next, draft a counteroffer if one was not provided with the rejection.
If the sale was not made contingent with another offer, you can possibly seal the deal with a counter. It’s advised to seek the help of an agent for this part of the process, as well. Be sure to work with an agent who understands seller interests and is going to have your back. Aside from counteroffering, there are a few other steps.
Ensure your finances are in top shape to better compete with other offers. You can also seek new construction.
While the price may be higher than pre-existing homes, the process for buying new construction can be simpler and you might not have to face rejection after rejection. As you continue your journey, remember to keep in touch with an agent, stay informed, and don’t compromise too much. It’s better to miss out on a home than to agree to terms with which you are not comfortable, or pay more than you can reasonably afford.
While the market is currently wild, finding a place to call home is not impossible. It’s important to stay positive and to keep looking. If you can’t seem to find any luck, there are experts available to help get you on the right path. For further information on what to do when an offer is rejected, please see the accompanying resource.
Infographic Provided by Marketplace Homes
Author Bio: Ian Hall is Vice President of Marketing for Marketplace Homes, a national brokerage and property management company. He specializes in real estate functions, such as buying and selling homes, with a particular interest in new construction homes and SFR investments.
