Wednesday, February 15, 2012

Step Two: Making an offer

We lowballed the offer.  As I said, the house was being sold “as is”, but it still clearly needed a decent amount of work.  We knew that the septic system would need to be replaced shortly after we moved in, a job for which the owner had already gotten a plan and permit for, and for which the bill was going to be $30,000.  We also knew that the house had already been on the market for over a year and a half and that the owners needed to sell as quickly as possible.  Knowing all this, we offered a price below our target price with the hope that after negotiation we would end up at or lower our target.  When we made our offer, the seller’s real estate agent told us to draw up the paperwork without even consulting her client if she wanted to negotiate.  We were a little surprised, but hoped this meant we were going to get the property for our initial offer.  After drawing up the paperwork and having our lawyer review it, we submitted it to the owner.
We heard back in a few days that the owner wanted more money and wanted to move the closing date back from our October offer to December.  She told us she had spoken with her lawyer and couldn’t accept anything less than the price that was our initial target price.  We were disappointed.  Even though we had initially expected to negotiate, we had gotten excited about the possibility of not having to do so.  Now with the price increasing, we took a step back to reevaluate if this was really what we wanted.  We talked about it, we worried about it, we stayed overnight in a B&B in the town to see what my husband’s commute would be like, and finally we decided yes we would go forward with another offer.
We still didn’t raise our price to what the seller had basically told us was her minimum, though.  We offered a price midway between our initial offer and her minimum, in the hopes we might still get the property for less.  But she remained firm, so in the end we met her minimum, which was our target price to begin with.  We also pushed the closing back to the week between Christmas and New Years to minimize our closing costs.  With the new offer submitted and accepted we had two weeks to start our inspections and surveys. 


  1. How did the week of Christmas & New Year's affect your closing costs?

  2. Since part of the closing costs are the payment of the partial year taxes, we only had to pay a couple of days of taxes rather than a few months.