When you’re selling your home, there’s a good chance you’ll receive an offer from a potential buyer that matches the list price. But this isn’t always the case… It’s important to properly evaluate all offers, whether you think they’re fair or not. Sometimes, it might be tempting to reject an offer outright if it’s lower than you were hoping for. However, there are several factors you should consider before deciding whether to reject an offer under the list price.
Keep in mind that rejecting an offer can potentially jeopardize the sale altogether, so it’s important to weigh all the pros and cons before making a decision. Whether you’ve already found another home or you’re just not ready to sell, it’s important to do so politely and within the law.
Here are a few tips on how to reject a lowball offer on a house.
Reasons To Reject An Offer
When it comes time to sell your home, you may receive an offer that doesn’t meet your expectations. While it can be difficult to turn down money, there are several reasons why you may want to reject an offer on your home. Keep in mind that every situation is unique, so consult with a real estate professional before making a decision.
Some of the most common reasons to reject an offer on a home include: wanting more money than the offer amounts to, needing more time to find a new home, and being unhappy with the buyer’s qualifications. Whatever your reason may be, remember that you have the power to accept or decline any offer made to you. Here are some of the most common reasons to turn down an offer.
You’re Being Lowballed
If you’ve been following the market at all, you know that homes are selling quickly and for more than the asking price. So when you receive an offer on your home that’s much lower than what you’re asking, it can be a really tough decision to make. You might be tempted to just reject it outright and wait for something better, but is that really the best move?
Before finally choosing the list price of the house, the seller will have the property priced fairly in accordance with the local real estate market. Because of this, the sellers will know the list price, which is the amount that the house should be purchased for. If an offer comes in that’s much lower than the asking price, it can be difficult for them to want to accept it.
The seller has essentially been lowballed – their house has been offered at a price that they feel is unacceptable. But what are your options? If you just reject the offer outright, you need to consider if other offers will come in closer to your list price. Chances are, if there is a lowball offer on the table, other buyers might be expecting an even lower list price on your home.
Sometimes, a buyer may try to lowball also by asking for concessions and contingencies. A contingency is an event that must occur before closing. For example, a buyer might ask the seller to cover their closing costs or home inspection fee. When you are negotiating, make sure you aren’t giving out concessions without getting anything in return. You may not mind paying for his closing costs, but while he’s asking for some things, see if there’s something you want from him too.
You’re Worried About The Funding Source
When you receive an offer on your home, it’s natural to feel a range of emotions – from excitement to relief. However, some homeowners may reject an offer even if it’s for the right price because they’re worried about where the money is coming from.
What is a funding source? A funding source is a third-party or an organization that provides money to someone or something. In the case of a home purchase, there are two common sources: the bank and loan brokers. Some other examples of funding sources include credit card companies, utility providers, lenders, and even your employer.
But, why would someone need a funding source? Whether it’s because the buyer doesn’t have enough cash to make a full down payment, can’t qualify for a traditional mortgage, or needs special financing terms due to an event in his life (like a divorce), a seller may require financial support from another party to help foot the bill.
The bottom line is that if the seller has any reason for doubting the source and legitimacy of funding, or if there are red flags that arise, they should always reject it.
You Have Received A Higher Offer
If you’ve ever put your home on the market, then you know that one of the most nerve-wracking parts of the process is waiting for offers to come in. You spend hours agonizing over whether or not to accept an offer, and sometimes it’s hard to know when to say “yes” and when to say “no.”
But, sometimes it might just happen that the seller receives several higher offers on their property around the same time, making them able to reject the lower ones. If you receive a higher offer on your home, the next step is to reject all the lower offers and other offers that come in.
When Is It Illegal To Refuse An Offer?
It’s not always illegal to refuse an offer on a home, because most offers are legally acceptable to decline. But, in some cases, the seller may be able to negotiate a higher price or rebuff an offer if it’s not in their best interest. However, there are specific instances when it is illegal for a seller to turn down an offer – and buyers should be aware of these situations before submitting an offer.
Let’s begin by asking an important question: When is it illegal to refuse an offer on a home? While this may seem like a simple question, there are multiple answers.
- Refusing an offer if the buyer is disabled
According to the Americans with Disabilities Act (ADA), it’s illegal for a seller to turn down an offer on a home if that person would be refused access because of their disability. This means that during any renovations or repairs, the seller must accommodate the buyer’s disability – meaning they cannot deny them access.
- Refusing an offer based on sexual orientation
The Federal Fair Housing Act prohibits sellers from discriminating against potential buyers based on their sex or gender identity. This means that it’s illegal for a seller to refuse an offer, refuse access, or even show a preference for one person over another because of their gender identity. Refusing an offer based on your race, color, national origin, religion, or sex is discriminatory and illegal.
- Refusing an offer because of a child with special needs
The Federal Fair Housing Act prohibits sellers from discriminating against potential buyers based on their familial status. This means that the seller cannot discriminate against you if you have children. The Department of Housing and Urban Development recently issued guidance prohibiting discrimination against families with children under the age of 18 as well as those who are caring for elderly adults who need care in their homes.
In addition, 42 CFR § 100.65(b)(11) requires owners to make reasonable accommodations in rules, policies, practices, or services when the person seeking a reasonable accommodation has a disability-related to a “child” under his/her care or custody.
How To Reject The Offer?
If you’ve been following the news in recent years, you know that the market for housing is on the rebound. While this is great news for homebuyers who have been waiting to purchase a home, it also means that sellers are seeing more and more offers come in for their properties. If you’re fortunate enough to receive an offer on your home that’s higher than what you’re asking for, it’s important to understand how to legally reject it.
The seller should never outright ignore the offer as that is impolite, they should always respond.
The first thing a seller should do is take a deep breath and review the offer carefully. Does it include all the important disclosures that both the buyer and seller must make? Make sure you read through any attachments to ensure they are accurate. If you think any part of the contract needs clarification, ask questions before responding to it. You don’t need to respond as quickly as possible, but you should at least respond.
After reviewing the contract ask yourself these questions:
Is there something wrong with the offer? Is it too low? Do they want all my rights to the property for a year or more? Are they asking for concessions that are unreasonable? Is this offer so bad that I would be better off rejecting it rather than negotiating down its terms? If you have given serious thought to rejecting this particular buyer, send them back an email saying things like “I don’t think I can accept your offer as written, but let’s meet again and see if we can work something out.”
Additionally, the seller may also choose to refuse with a counter offer – if the reason is simply an offer that is too low, or some of the concessions can be met, there may be room for negotiation. A counter offer on a home is not the end of the road; it is a simple “No thank you, but I would be willing to work with you if….”.
Summary
There are a number of reasons why selling a home privately can be advantageous. For one, there is no commission to pay, making the process more affordable. Additionally, potential buyers can be shown the property at their convenience, without having to wait for realtor availability. Finally, by selling directly to a buyer, you have more control over the sale process and may be able to negotiate a better price.
While these advantages are undeniable, there are also some drawbacks that should be considered before deciding whether or not to sell your home through a realtor. One such disadvantage is that realtors often have access to databases of interested buyers, which private sellers may not have access to. Additionally, realtors have extensive knowledge of the housing market and may be able to get countless offers. But, just as this article has started, there are plenty of red flags and reasons why a home seller can reject a lowball offer.
The process of finding buyers and going over every offer, then rejecting most of them, is a time-consuming one. If you are selling your home and don’t wish to follow this route, then selling your home to cash buyers will be your best bet. While there are many cash home buying companies out there, it’s important to do your research before choosing one so that you can be sure you’re getting the best deal possible that is close to your list price.
With Simple Sell Home Buyers, we make the process of selling your home simple. We buy homes for cash and don’t require any repairs or renovations in order to close the deal. If you are interested in getting into contact with us or to schedule a home tour, give us a call at (+)1-516 603 5748.
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