House #12: First Offer

August 9, 2009 · 2 comments

The Mini House has been on the market for about two and a half weeks, and — despite the fact that it isn’t even staged yet — we’ve gotten a lot of interest from potential buyers. This weekend, we received our first offer on the property.

The offer was for about 95% of asking, with us paying about 5% in closing costs for the buyer, plus a home warranty. Overall, the offer isn’t too bad, and would easily allow us to make over our minimum profit target. That said, we’ve decided to counter-offer for closer to full-price, with the rest of the financial conditions staying the same.

The buyer wanted to close at the end of this month, but she is an FHA buyer, which means that the deal wouldn’t be able to close until at least September 29 (FHA 90-Day Rule). So, in addition to our counter-offer on the price, we’ll have to see if she is okay with pushing out the closing date an extra month or more, and we’ll also have to talk to her lender to determine if they’re comfortable moving forward with an FHA loan this early in the seasoning period.

Given that the earliest closing date for this buyer is over 7 weeks away, a lot can go wrong between now and then. So, even if we get a signed contract in the next couple days (which I suspect we will), there’s no guarantee that this deal will go through.

2 responses to “House #12: First Offer”

  1. Even if you accept the offer, with the 7 weeks to go until a possible closing, would you still keep marketing the house for “backup” buyers?

  2. J Scott says:

    Hey Scott –

    We always keep looking for backup buyers, though if the lender allows us to officially create a contract now (some FHA lenders say you need to wait until Day 91 to sign the contract), we’ll take the property off the MLS. If we can’t sign the contract for several more weeks, we’ll verbally accept the offer, keep it on the MLS, and take backups knowing that there is a better chance it won’t go through.

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