When it comes to negotiating on a real estate purchase most people think of things like price, closing date and repair credits. There are so many other items that can be negotiated though, so let’s talk about them.
10 Items You Can Negotiate When Buying Real Estate
We will start with the obvious ones:
1.) Price: this is the main one everyone focuses on and on most deals things play out after there has been an offer and then a counter offer.
2.) Closing Date: Many times this is dictated by the lender as they need 30 or more days to close on a loan.
However, when buying in cash you could close as fast as the seller is willing to do it and the title company can process it.
On the flip side, maybe you don’t want to close till 60 days from now for financial reasons. Will the seller accept that? There is only one way to find out – negotiate!
3.) Repairs/Credits: If there are items in the home that need to be repaired, will the seller pay to have those items fixed before closing? Will you instead get a credit for the estimated costs of the repairs if they will not? What dollar value will you and the seller agree on for those credits?
Not as obvious items to negotiate
Now that we spoke about the ones everyone usually thinks of – let’s touch on some others:
4.) Possession Date: You very well can close on a specific date and take possession on a different date. Let’s say you plan to close on the 15th of the month, but the seller cannot vacate until the 30th.
You could setup an agreement where the seller pays you rent for those 15 days. Either way it something that is negotiable.
5.) Financing: It doesn’t just have to come from the bank. Is the seller willing to finance the property to get monthly loan payments as opposed to being payed a lump sum at closing? Only one way to find out. Ask and negotiate.
6.) Items left in property: Are there appliances in the home? Are they staying with the home upon purchase. Or to take it further, let’s say there is a beautiful pricey chandelier hanging in the dining room. Is it staying or going? Negotiate!
7.) Home Warranty: Sometimes you will see a home warranty included in a sale to cover items that may break after closing. Here’s the thing though, if you don’t ask for one you won’t get one – negotiate!
8.) Contingencies: Most people think of the home inspection and financing contingencies of a standard sales contract to be a set thing. They are not though, you can use them as negotiation tools.
This is one of the benefits of when someone buys with cash, they can waive the financing contingency, thus making them a much stronger buyer than someone relying on financing.
Also, the number of days for the home inspection contingency is completely negotiable as well. Just because there is a standard default number on most sales contracts doesn’t mean you are stuck with it – negotiate!
9.) Closing Costs: Often people think that the buyer pays their closing costs and the seller covers theirs and that is all there is too it. Wrong! This is also an item that can be negotiated.
10.) Closing Location: Will the closing occur at a title company’s office or a lawyer’s? Whose will it be, yours or theirs? Furthermore, if you are buying property out of state can an offsite closing be done with a notary?
Negotiate to get a deal done!
Negotiating these items isn’t just about getting the most you can out of a deal. It’s about getting a deal done that otherwise may not have happened by taking the standard line on the items listed above.
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