Are we playing craps?
Highest and best refers to a two prong test for any offer written on a seller’s home, condo or town-home that is for sale. When an offer is written by a Buyer’s Agent, and when more than one offer has been written by different buyers agents on the same property, a typical response is “Give us your buyers Highest and BEST!”
The “Highest Part”
Highest, always bottom lines at price. What will the seller net with each individual offer that has been submitted? There are many different “seller to pay”
for items that may be built into any offer. These can include Buyer’s real estate closing costs, well and septic certification, requests for additional funds and more. After those deductions, with the submitted offer are taken into account, which offer equates to the “highest net” for the seller. Which one will make the seller the most Money?
The “BEST part”
Best usually always have to do with financing. The best type of offer, the one held in the highest regard, is the “suitcase” full of cash. Cash is King everywhere, including in Real Estate. However, 20 percent and more “conventional offers” run a close second. The reason for Strong Conventional offers being very close to cash offers, has to do with the banks(if they are the owner), not being able to close any faster than 30 days. 30 days is the typical time-frame for closing(escrow time) with a Conventional Offer.
With FHA and VA offers, some sellers are under the impression they will net less overall. That could be the case, if the property needs any repairs to allow them to pass the FHA or VA appraisal. However, a real estate expert should be able to guide the sellers with regard to their specific property and why or why not it might not finance for certain loan types.
Local agents give you the best advantage
The most important thing you may want to realize is about working with a Local Santa Clarita Real estate agent. This will benefit you in many ways, including what to consider when approaching a “highest and best” counter offer.
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