Are foreclosures a good buy in today's market?Having sold more foreclosure properties over the last decade than anyone in Central Oregon, I'm pretty comfortable diving into this one. Looking
Why No One Wants To Work With Contingent Buyers
Why don't sellers want to work with contingent buyers in the current market? We could keep this really short buy simply stating:
BECAUSE THEY DON'T HAVE TO!
So what's the lesson here? Don't be a contingent buyer if you can at all avoid it. Part of a good broker's job is to put you in a position to win. The contingent buyer is a loser in today's market for several reasons.
Uncertain timeline to close
Inability to close - While the contingent buyer is ready and willing, they lack the important 3rd trait of a true buyer - the ability to close.
Stress - Because the contingent buyer has a home to sell, they are depending on another buyer to purchase their home. In most cases we don't know who this mystery buyer is, who they are financing with, if the deal is even legit, or if the information we're receiving is even accurate. All of this adds uncertainty and stress to the process. None of these are good things!
Lots of people ask us what to do when they need to sell their home before purchasing their next one. While each situation is slightly different, the goal is always the same. We want to put our clients in a position to win! Our goal is to make the process as stress free and enjoyable as possible so we deploy a few different strategies depending on our clients needs. One of the smartest ways to handle this is to get the existing home sold first so we have the all important 3rd component needed for purchasing - the ability. A competent agent should be able to negotiate a lease back, creating plenty of time to identify and close on the next transaction.
Why employ this strategy? Our goal is to help our clients purchase or sell their home. Being a contingent buyer means you're the last offer that a seller wants to accept as well as your loss of leverage in negotiations. If you're asking a seller to concede to you on terms, i.e. uncertain closing date and an uncertain close in general, it's not a stretch to say that the contingent buyer has no business negotiating price because he/she lacks the ability to close.
As a listing broker, the contingent buyer does serve to increase their leverage with other potential buyers if the seller is happy with the financial terms the contingent buyer is offering, but on the other side of that coin, the contingent buyer is in a position where they can be bumped out buy another buyer and sent back to square one to begin again.
Overall, the process can be really frustrating for a contingent buyer in today's market. If you're not sure what your next steps should be or what to do to reach your goals, get in touch with us. We're happy to discuss anytime.