Out of pocket? Likely none but on rare occasions when purchasing a FSBO or ‘mere’ posting my commission may be a closing cost. We’ll strive for that fee to be included in your mortgage. Buyer agents do charge a fee, and the fee is paid through the seller, so as a buyer, you will almost never pay any commission fee…or so you may think 🙁
Nope! You have a choice to go it alone. Just like you have the choice to allow an agent whose obligations & loyalty is ‘contracted’ to the Seller. I do feel it’s in your best interest to have representation similarly to who the Seller working in their best interest of the seller which means you need someone on your side to make sure you get the best possible deal.
Contrary to what has been told for years…or at least this is what I discover when I follow the math. If you’re bringing to the table, say 5% plus closing costs, and the bank the other 95%. Together that’s 100% of purchase price that includes commissions.
I won’t tell you not to, but it has been my experience and I believe the Toronto Real Estate Board has found bully offers essentially activate many early offers and that Bully averages 10th place on presentation day. Each Board has rules in place to ensure all interested parties have a fair chance at offering, but like all rules, they sometimes aren’t executed properly.
I’ve noticed most offers do come in at offer date and right up until presentation time. By waiting ’til then you do risk missing out if a Bully offer is accepted. My suggestion is if this is the house you want…write right away at “asking” price, not higher. You’ll then, have the ability to adjust your offer if competitive bids happen.
Regardless of your reason for not closing, outside of something out of your control, the Seller may and likely will be looking for compensation if this adversely effects their sale. Very least, be prepared to lose your deposit, and if that’s all that happens consider yourself lucky, otherwise close or ask about “Assigning”.
This is a KEY element to getting the home you set your sites on. It’s preparation before you offer so you know exactly what you will be able to afford prior to taking the time to write or consider a sign back if the sale price is beyond your lender’s sanctioned lending amount. It may help to include such a letter in the offer.
Conditional offer is NOT the same as an offer with conditions. Conditions, if you’re lucky to have them agreed to your due diligence, like inspections, financing etc. “Conditional” refers to an event taking place before you can buy like selling your home. This is called an SOBP offer or “Sale Of Buyer’s Property” which likely will deter the Seller from accepting, but ever case is different.
PROS means you’re getting the due diligence you to comfortable purchase this next property. CONS could be you find yourself not at the top to be considered b/c many sellers these days are looking for slam dunk offers. But is an offer w/o financing really a slam dunk. I as a LA refer an offer w financing that way I know when their due diligence is done, we will close.
Sure, why not, but this could open the Seller’s ability to walk away and move on to a backup offer. It is possible to re-negotiate if you find something egregious in the inspections that would prevent its sale. Each case will be different but please don’t expect a better price. It could bite you.
If you want my representation, you will NEVER ask me to write one of these – you’re fired as a client! Sorry if that sounded harsh but I firmly believe they do more harm than good. It is a clause written to allow you the perceived privilege of automating your bid above the highest in efforts to win out. You also tell the LA what you’re willing to pay because there’s a cap on your escalation. I’m a savvy REALTOR, and I would counter back removing this clause at your max bid! Don’t do it! (ps ~ I really won’t fire you)
I’d never want to say never, but this is one of the cases where it’s pretty close. I like to think I bring a lot of value to the table, to your table. Let’s go over my Value-Added Representation first.
You the Buyer would be seeded #2 behind the chosen offer. In the event of first offer falling apart you could slide in and buy. There will of course have to be proper wording and protection to you in case you decide on another home so you can easily remove yourself. On average I’d estimate BUO’s close about 3-7%
Personally, I feel it is purely marketing on the LA’s behalf and does more to harm the industry that propel it. The word ‘asking’ is key! I’ve seen over-priced listing sit nearly a year until it reduces to normal only to be sold above and watch the agent boast. Have me or your choice of reps look at market value. If an agent wants to brag…see if they have a BOUGHT UNDER ASKING sign. I do 😀
For those interested in investment properties there’s a few terms to know and understand and this truly does require a one-on-one.
NOI – Net Operating Income or the gross income minus expenses
CAP RATE – The above NOI divided by your purchase price
ROI – Return on Investment determined by your total.