Counter offer received. Thoughts?

6 Replies

Hey guys,

So I made an offer on a 4 family this morning.  Asking price was 119K (124K last week) and I offered 95K.  Some numbers on the property:

About 500 per unit (fully occupied) and could be raised to maybe 550 or so.

Taxes 3000 per year

C Class area

Tenant pays electric and water

About 200 a month in other utility expenses per month for me

The property does a need a little rehab, but its fully functional as is.  

SO

They countered at 117K and will replace all windows (between 25-30).  However I am at the upper limit with my bank and can only purchase a property for 110K with 30% down.  Anything higher would be additional down payment.  I was planning on using a 401k Loan for down payment as Im closing on a different property in a few weeks.

I have until 5:00p today and they claim to have received another offer by email, but its not an official one.

Any help would be great.

I would explain that to the seller about the bank. If you can justify it to them they might accept it. The other option is to ask for seller financing, maybe you can put less down and get the window credit at closing. This will free up more cash for rehab. Pay a little more to get the seller financing option.

What interesting is that they offered to do the windows on another property he is selling.  I dont know if it would be in the form of a credit or if they would actually replace them before closing.  It almost seems they own / work for a window company or have a connection since that seems to be their icing on the cake.  

I asked about seller financing and they dont want to do it; nor do they own the property outright.

Originally posted by @Erik Schilling :

What interesting is that they offered to do the windows on another property he is selling.  I dont know if it would be in the form of a credit or if they would actually replace them before closing.  It almost seems they own / work for a window company or have a connection since that seems to be their icing on the cake.  

I asked about seller financing and they dont want to do it; nor do they own the property outright.

 Tie the property up, and during your contingency period demand a discount. All they can say is no, you're already ready to potentially walk now so if you really wan this deal then its an option.

I don't recommend people typically do this, but when theirs a difficult seller or I feel like I'm getting brokered (either by the actual broker or the principal themselves) I've been known to take this tack.