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Letters to and from buyers and sellers really work

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In this competitive market, buyers can send a letter with an offer to gain an advantage. Combined with a solid, well-prepared offer, personalized letters do work to help get the deal.  They show interest and give confidence to the seller that the buyer loves and desires the home. 
 
So what is this about? I always tell my sellers they should pick the highest offer that will close.   There are many factors to consider in the evaluation of an offer.  The biggest fear of a seller is a buyers true motives. Are they rushed? Do they want to put the house under contract? Then, decide later if they want to buy it.
 
Buyers can get a home under contract for a nominal option fee. Are they feeling they will miss out if they don’t act fast? Sellers want buyers emotionally invested at the time of making an offer, not later. A great real estate transaction has all parties looking for a win-win outcome from the onset.
 
From contract execution to closing, negotiating power of the buyer increases while negotiating power of the seller declines. The option phase is an exclusive right of first refusal. It is risk-free for the buyer but not the seller. If a contract terminates before closing, the seller loses critical time.
 
Another big issue is financing risk.  An offer can come in above appraised value. Sellers want a buyer committed to close more so than the highest offer. Letters help reinforce commitment. Of course, earnest money intends to protect a seller. In reality, the benefit of earnest money in protecting a seller is nominal.  
 
Agents help the seller evaluate risk. They speak to the buyers’ agent and lender to verify sincerity and details. Good seller due-diligence centers around determining the buyer are “in love with home”. Has no hidden agenda, and wants the deal to go through.
 
Interviewing a buyer agent and lender is a critical piece of this evaluation. I call it looking them straight in the eye over the phone. I want to hear them stake their reputation that what they say is true. No agent or seller can review an offer and predict the future.  
 
Agents and lenders respect the needs of both parties. They have a long-term view that ethical behavior is a large part of the job and want to be a success. The good ones are transparent in their dealings and don’t hide risk factors. A letter to the seller demonstrates sincere interest.
Photo by sflovestory
For a letter to help it is genuine and personalized for the home and situation. It is easy to see through boilerplate letters that apply to any home.
 
The best letters state why this home is best for them. In reverse, I have seen a letter from a seller to a buyer emphasizing benefits. Advising the buyer in a heartfelt way they should give consideration to accepting a counter. This strategy doesn’t apply to a multi-offer situation. It closed the deal with this home. 
 
Letters don’t take a lot of time and work like therapy. If you write it down you have thought it through and are likely to make a better decision for all involved.

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