I was hoping I could get some opinions/advice on making a good offer.
I recently had an offer rejected (my first offer on a property, trying to get my first deal). First, I understand that: 1) Not every offer I make will be accepted or countered, 2) Most likely, my offer was rejected because there were other higher offers. That being said, I was hoping to get your take on a few things that I could do better.
First off: My offer was: $70k cash, inspection contingency, 15 days to close, $2k EMD. The list was $80k and it was a REO property on the MLS. I was hoping to get a counter-offer and I could go as high as $75k.
First off, for an offer with an inspection contingency, How soon should I put my closing date? I had mine at 15 days, however it seems like the winning offer closed the deal after about 10 (they had an inspection contingency).
Secondly, my offer was cash. When I went in the bank to get a "Proof of Funds" the lady who helped me didn't seem to know what I was talking about. I left with this letter:
"Regarding: (property address)
To Whom It May Concern,
Please let this letter show proof of available funds for purchase of real estate in the amount up to $70,000.
Signed: (lady at the bank with phone number)"
Is this acceptable as a proof of funds document?
Finally, What is an appropriate earnest money deposit? I put had $2000 and included a photocopy of a check written to my title company.
Again, I know that most likely, my offer was rejected because it was too low, but I'm just wanting to make sure when I make another offer there are no strikes against it other than price.
Everything you did sounds more generous than most I've seen or heard!
The POF letter was fine. The offer you made was generous - if it was price, then the buyer must have gave a full price offer!
And, I've heard of 1-2% ERD or less to successfully grab an REO on a cash deal...
Maybe just the "luck of the draw"...
With an REO it really depends how long it has been listed. The banks are very stubborn in the first 30-60 days, so if they got a full price offer then there is no competition with that. But your offer seemed fine and I do not think the rejection had to do with your terms or POF.
Ok Thanks guys!
With the proof of funds letter, do you normally want it to be in the exact amount of your offer?
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