Prepare to Negotiate
Buying a house has been likened to an extended conversation where the most important things said are expressed in written form. The conversation’s initial point comes when the seller places the home on the market. It continues as a would be buyer enters a bid and sets a time limit for acceptance. Buyers seldom accept the original offer as is.
What happens next is the counteroffer the seller makes in response to the bid. It includes amendments in writing that add to the original offer. A new deadline is set for the buyer to respond to the most recent proposal. Generally, the seller wants the buyer to pay more. There may also be stipulations to give more time for a special situation such as allowing children to complete their current school year.
Sometimes the two parties will get stuck on seeming trivialities such as whether a certain appliance should be included in the sale. This and other discrepancies between offers can lead to lengthy negotiations before the two parties reach a settlement agreeable to both. The compromise that is reached can often be a matter of one or both parties tiring of this back and forth process which can be nerve wracking for both sides. Most people are not used to having to argue over fine points in this manner. Even if one of the two parties is familiar with such proceedings, it can lead to suspicion on the other party’s part that they are being taken advantage of. Even with both sides relatively experienced in the field, lengthy negotiations can result over irreconcilable differences.
How to Bridge the Price Gap
There are so many points involved in real estate transactions of this sort that the two parties should count themselves lucky if all they fail to agree on is the price. Compromise of this sort are more easily negotiated than is the case when the sticking point involves some beloved decorative object that the seller cherishes and the buyer desperately wants included in the sale. A price point can always be reached, but it is impossible to split the difference in the case of a beloved piece of garden statuary or a living room chandelier.
A buyer may be in a real bind when it comes to upping an offer. Their lender may not be willing to extend them any more money, and they may lack other avenues for securing additional funds.
Such an impasse should not be taken as a deal breaker. If the seller absolutely will not bring down the price, and the buyer still wants the home, it may be time to negotiate a loan of some sort from the seller. The price difference will in effect be an additional mortgage held by the seller. The buyer pays the money back over a certain period of time, say 5 to 10 years. All that need be done now is to come to an agreement over the interest rate that the loan should carry for the sale to be completed.
Prepare to Negotiate