How to Discover Your Negotiating Position ... - Business Negotiation

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'; div.innerHTML = summary; } //]]> How to Discover Your Negotiating Position When Buying Your First Home How to Discover Your Negotiating Position When Buying Your First Home

When you are sitting with your real estate agent preparing your offer or sales agreement you need to understand the eight major areas of negotiating in the sales contract.

Major Area 1: Price or Terms

* Price ? The amount that you are offering to pay. If you are paying all cash within a couple of days you should expect a lower price.

* Terms ? These are all the little extras that you want done in exchange for buying the house. If you are asking for more repairs, different paint etc. then you are negotiating terms.

Major Area 2: Your Deposit

You can use a larger deposit as a leverage point which can make the sellers overlook some of your terms. However, be aware that you could lose your deposit if you don?'t have a real estate attorney review the contract first.

Major Area 3: Your Financing

If you are already pre-qualified for the amount of financing that you need prior to negotiating with the seller then that puts you in better position.

You have a weaker position if you need to have the seller give you money back at closing or have to wait for a down payment assistance grant to come through.

Major Area 4: Time to close

The sooner you can close after your offer is accepted the better the sellers will feel about your offer. The longer you wait and drag it out you can either gain an advantage because the sellers may lower their price or you could communicate to the sellers that you are wasting their time. Using time to your advantage is a good thing, but you need to know as much about the seller as possible before using this strategy.

Major Area 5: Contingencies

At the minimum your sales contract must have stipulations for a clear title, home inspection, the final walk-through and the appraisal getting approved by the lender.

Properly worded contingencies can add an extra layer of protection to you as a buyer.

Major Area 6: Negotiating Strategies

Throughout the course of negotiating for your home, you are going to have to fight the feeling of being overwhelmed. Whenever that emotion threatens to take over, just remember that there are really only a couple of strategies the seller can employ. I will take at look at your negotiating options and then we will review the sellers options.

Major Area 7: Buyer Offer Strategies

While you may feel overwhelmed by all of the options you may think you have when negotiating, there are really only three different types of offers you as a buyer can make.

* Lowball ? You present an offer that is really low in comparison to what the seller is asking.

* Almost At Asking ? The offer is close to home sellers asking price, but there is a little difference due to some reason or maybe even no reason at all.

* Meet In The Middle ? You come in with somewhere in between low-balling and at asking while asking for some concessions.

Major Area 8: Seller Counter-Offer Strategies

Once you submit your offer there is a tendency for buyers to over-think all of the options a seller may use against them. In reality the seller only has a couple of choices.

* Highball - The seller rejects your offer and comes back with almost the same amount as asking price.

* Meet you in the middle ? Counters back but less than asking price but a little higher than your offer price while asking for some concessions.

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Source: http://business-negotiation.blogspot.com/2012/08/how-to-discover-your-negotiating.html

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