By Katherine Macol, Esq.
There is no doubt that the current housing market is a seller’s market. There are more buyers than homes available. Buyers are commonly facing bidding wars and “over ask” purchase offers are becoming the norm. While is it easy to get caught up in the frenzy, it is important to consider your budget, market conditions and, if financing is a requirement, be sure to familiarize yourself with your lender’s loan parameters. An appraisal will likely be a requirement of the loan and there must be comparable sales data available to the appraiser to substantiate the “over ask” purchase price. In the event the property does not meet your lender’s loan parameters, and the contract does not contain an appraisal contingency, your deposit may be at risk, you may be responsible for the difference in value between the purchase price and the appraisal or, if the seller is willing, renegotiating the purchase price may be in order.
Purchasing a house is not a decision to take lightly and making an “over ask” offer must be an informed decision.
Shelton: