Winning a property in Best and Final

5 Replies

So I want to hear from the BP community.. How have you made your LOI more "competitive" to the seller and broker when sending it in? I know increasing offer price helps of course. But are there any personal touches you have seen that work in your offer being accepted?

Thanks!

Make inspection for your knowledge only if a SFR, this one works great in residential. Also always always always call the listing agent or the seller and find out everything you can. Closing date, inspection timelines, non refundable earnest money, etc... are all good ways to strengthen your offer as well. I've also seen people use a clause stating something like "will pay "x%" above max offer with a cap of "x" amount" which can give you a better shot if you were competing strictly on price but don't want to have to go above and beyond your range. Be sure to ask for proof of the other offer to protect your buyer when using that type of clause though.

Sellers and brokers want to see short due diligence times, substantial deposits up front and perhaps an additional deposit at conclusion of due diligence.  And of course non-refundable earnest money day one (but a lot of buyers hate doing that, myself included). 

They don’t want to see loan contingencies or other escape clauses. 

But the biggest influence is something that isn't in your LOI. It is your relationship with the broker or even the seller, your track record of closing deals without retrading and your general reputation in the industry. Stuff like how many units you own and how many deals you've done in that market really do matter. Brokers and sellers are looking for buyers that will close and not make their lives miserable in the process. That's far more important than terms and often even more important than price.

Everyone seems to have nailed it already, but one thing I could add is to provide proof of funds upfront. 

Also, if you haven't met with the broker it can help to have some kind of written track record of investments (either online or in a file). 

My partners and I like to include Team Bios that demonstrate we have a team in place with experience and the ability to perform. In addition, we provide a list of similar properties we have closed in the past. Finally, if possibly, we attach Proof of Funds to the end of our LOI.