When buying a home in Naples, FL, putting in a strong offer is important in today’s competitive market. A new form, Escalation Addendum to Contract has just been released for use. While there is no requirement to use this form, it does provide buyers an increase in the competitiveness of their offers. This form is used to ensure a buyer is the highest bidder in what will probably be, a multiple offer situation. Using this form also shows a buyer is serious and how far they are willing to go.
The Escalation Addendum, when properly executed by both parties, allows for the buyer’s offer to incrementally increase all other offers, making them the highest offer. Included in the Escalation Addendum should be a cap – the Maximum Purchase Price. Special consideration should be used if financing is involved. A buyer using financing may have to come up with gap money depending on the appraisal amount and what the final purchase amount is.
As is the case with most real estate offers, sellers want to see proof of funds or pre-approval letters indicating the buyer qualifies for the escalated amount – up to the maximum purchase price. Without proof, the offer does not hold up as a solid offer.
On the seller’s part, in order for the escalation to be accepted, the seller must provide to the buyer, a copy of the competing offer to prove there is a bona fide offer being presented by a verified party.