A competitive offer isn't just a higher price. It's the offer that gives the seller the most certainty for their money. Call the listing agent first and learn what the seller cares about. Price with real comps. Then strengthen the terms your buyer can afford to strengthen: a solid pre-approval, a meaningful earnest money deposit, sensible deadlines, and a clear plan for the appraisal and inspection. Here's how I build one, and how I explain the risks to buyers.
The short answer
Sellers weigh price, certainty and convenience. You win by finding out which one matters most to this seller and writing to it, within your buyer's comfort zone. Every term you strengthen also adds risk for your buyer. Explain each one plainly so they choose with their eyes open.
Step by step
- Call the listing agent. Ask: "What matters most to your seller? Timing? Price? Anything that would make an offer stand out? Are there other offers? When are you reviewing?"
- Run the comps. Sold, pending and active. Know where value really sits.
- Show the buyer three strategies. Maximum leverage (lowest price, more asks). Strategic value (fair price, standard terms). Competitive (stronger price and terms). Let them pick.
- Strengthen the loan. A full pre-approval, ideally with a call from the lender to the listing agent.
- Earnest money. A meaningful deposit signals seriousness. Explain when it's at risk. See earnest money.
- Deadlines. Shorter inspection and loan deadlines can help, if the buyer and lender can really meet them.
- Appraisal plan. Decide if and how much the buyer can cover above appraisal. See appraisal gap.
- Inspection plan. Keep the inspection, but agree up front to focus on major items.
- Closing date and possession. Match the seller's needs where you can. A rent-back can win.
- Use approved forms. Your state's approved contract and addenda. Check unusual terms with your managing broker.
- Send it clean. Complete, signed, with the pre-approval and proof of funds. A short, professional cover email.
A worked example (illustration only)
A home listed at $500,000. Comps support $505,000 to $515,000. Two other offers expected.
| Strategic value | Competitive | |
|---|---|---|
| Price | $505,000 | $515,000 |
| Earnest money | 1% ($5,050) | 2% ($10,300) |
| Inspection | Standard deadline | Shorter deadline, major items only |
| Appraisal gap coverage | None | Up to $10,000 |
| Closing | 30 days | Seller's preferred date + 2-week rent-back |
| Seller concession | $5,000 | $0 |
Illustration only. Terms must fit your buyer's finances and the forms used in your state.
How to explain it to your client
"Here's how sellers think. They want the most money with the least chance of the deal falling apart. So we can compete on price, on terms, or both. Every term we tighten makes us stronger, but it also adds some risk for you. Like if we agree to cover part of an appraisal gap, you need that cash ready. I'll walk you through each piece, and you decide how far you want to go. My job is to make it strong without putting you in a spot you'll regret."
Watch-outs
- Don't waive what the buyer can't afford to lose. Waiving inspection or appraisal protections can be very costly.
- No escalation games without rules. Escalation clauses must be written correctly. Use approved language and check with your managing broker.
- Love letters. Many brokerages discourage buyer letters because they can raise fair housing issues. Follow your brokerage policy.
- Don't oversell the pre-approval. It's not a loan commitment.
- Deadlines are real. Missing one can cost the buyer their deposit or rights.
- Fair housing. Offers are about price and terms. Never about who the buyer or seller is.
This is training for real estate agents. It isn't legal advice. Use your state's approved forms and check with your managing broker.
Questions
Should we offer over asking?
Only if the comps and competition support it, and the buyer is comfortable.
How much earnest money is enough?
It varies by market. 1% to 2% is common in many areas. Your buyer must understand when it's at risk.
Should we waive the inspection?
I don't recommend it for most buyers. A shorter, focused inspection period is usually a better trade.
What's a rent-back?
The seller stays in the home after closing for a short time, under a written agreement.
Should my buyer write a letter to the seller?
Check your brokerage policy. Many say no because of fair housing risk.
Brian Lee Burke is the founder of PadLeaders, a Colorado real estate broker licensed since 2003, team leader of The Kenna Group at Keller Williams DTC (formerly Kenna Real Estate Group) and the author of Mastering Real Estate and The Real Estate Playbook. More about Brian.