If you are shopping for a home, you will have no greater joy than that of dealing with a motivated seller. The following are some of the benefits you may enjoy from a motivated seller.
Go ahead and submit a low offer if you know the seller is motivated. Maybe the seller is afraid of a looming foreclosure or has started the purchase process of another house and wants to sell the current one fast. A motivated seller is more likely to entertain a price reduction than non-motivated sellers are. Even if that doesn't happen, you will at least get the negotiations rolling with your low offer. Note that this is more likely in a buyer's market than a seller's market.
A motivated seller may also offer you concessions to hasten the sales process. For example, the seller may offer to:
- Pay some fees such as attorney fees, inspection fees, and appraisal fees
- Pay some of the closing costs
- Lower their contingencies
- Throw in some additional items, such as kitchen appliances, along with the home
In short, a motivated seller may go out of their way to ensure you are comfortable with the deal. You may end up spending less than you would have otherwise spent on the house.
A motivated seller will want to close the deal as soon as possible. For example, a homeowner who is facing the possibility of foreclosure will want to sell fast before the foreclosure process begins. A homeowner who is relocating may want to sell fast to allow them to focus on the purchase of their new home. This may work to your advantage if you are also interested in fast closing.
Lastly, a motivated seller may also relax their contingencies or allow you to squeeze in as many contingencies as possible. Some of the typical seller contingencies include:
- Home purchase contingencies that allow the seller to back out of the deal if they can't buy another house
- Rent-back contingencies that force the buyer to rent back the property to the seller after purchase
- A fixed closing date after which the seller is free to accept another offer
The above are just a few examples. A seller can come up with a dozen contingency if they want. However, a motivated seller is likely to have few or no contingencies.
A seller's motivation might not help you if you don't know about it. A real estate agent can help you identify a seller's motivation and find your next home.