What to look for when choosing between multiple home offers

white and brown painted house

Multiple home offers? Here’s how to pick the best one

When you get multiple offers for your home, it means it’s in demand and you have the opportunity to pick one you really like. But there’s more to an offer than just the price, so how do you know which one is best? We put together this all-in-one guide to weighing contingencies, considering cash offers, and picking the best offer to help you understand it all.

Here’s what we’ll cover:

  • Why an accepted offer is far from the final step
  • Why the highest offer isn’t necessarily the best
  • How to consider the buyer’s financing options
  • What a contingency is and what the most common ones mean
  • Whether or not you should negotiate with a buyer

When a buyer submits an offer, you’ll be able to look at a number of things before accepting. If you’re in the position to choose between multiple offers, understanding things like contingencies, financing, and negotiations will help you choose the best one. 

But it’s crucial to know that accepting an offer doesn’t mean that the deal is done, it simply triggers the next steps; the sale can still fall through even after an offer has been accepted. Let’s take a look at some of the factors that you should weigh when choosing between multiple offers.

The price

Obviously, the first thing you’ll be looking at is the offer price, and in a hot market, the offers could be over the list price by a significant amount. But price isn’t the only factor that you should consider. The highest offer may look more favorable at first glance, but digging into the offer might reveal that it comes with multiple contingencies that could slow the process—and potentially jeopardize the sale. 

Prequalification vs. pre-approval

If a potential buyer comes ready with a pre-approval for a mortgage, this is a good sign, but far from a guarantee. After all, every buyer’s first step in the mortgage process is to get prequalified for a loan by giving their bank basic information, like their income and debt, to get an estimate of what they might be able to buy. But this is in no way a guaranteed amount.

To get a more accurate amount of what they could borrow, buyers can go through a pre-approval process—an in-depth look at their finances, including credit score, pay stubs, tax returns, and bank statements. Once a buyer is pre-approved, the process to secure the actual mortgage goes much faster than if they were just pre-qualified.

But of course, a pre-approval is not a completed mortgage, and until the mortgage is legally underwritten, the lender might still pull the loan from the buyer if they find something unfavorable in their financial history. 

An offer that comes with a pre-approval letter is more favorable than one that comes with just a prequalification because it can make the closing process faster, but the best offers are those that are pre-underwritten. Some lenders, like Flyhomes Mortgage, can pre-underwrite you first by going through the entire financial background check and guaranteeing the loan amount before it’s in escrow.

Read more about the difference between a mortgage pre-approval and a pre-underwritten mortgage here.

Method of payment

When you’re choosing between multiple home offers, it’s important to consider the way that the buyer will be paying for the home. If the buyer makes a cash offer, the closing process can go faster because they don’t have to wait for a mortgage lender to approve their own. But cash buyers may also offer a little less and use the faster closing process as a bargaining chip.

Whether or not you accept a cash offer depends on your needs and desires for the home sale. Would you rather close fast, or for more money? Some cash offers can offer both speed and a higher amount—but not all of them. 

brown and white concrete house near green trees during daytime
Sellers will likely receive more than one offer in a hot real estate market, but the highest or the first one is not always the best one

Earnest money deposit

An earnest money deposit is money that a buyer offers to the seller as a way to show how serious they are about the potential home purchase. Typically around 1-2% of the home purchase price, this money, given as a check or put into an escrow account, is given to the seller when the sale closes. If the sale falls through, this money could stay with the seller or be returned to the buyer, depending on the circumstances.

If a buyer is offering an earnest money deposit, it’s a good sign that they’re serious about wanting the home. The higher the deposit, the more certain the buyer is that the sale will close on their end, but remember that it’s not a guarantee that you, as the seller, will get to keep it if the sale falls through.


Purchase contingencies help protect buyers from surprises during the buying process by giving them a way out of the contract if certain agreements aren’t met. As a seller, however, fewer contingencies means fewer hurdles to the final sale, so it’s important to consider what contingencies a potential buyer is requesting, and if you’re willing to abide by them. Here are a few of the most common contingencies and what they mean.

Inspection contingency

Most buyers request that the sale is contingent upon a favorable inspection. A favorable inspection is dependent on the individual buyer. So, an inspection contingency basically means that after the home inspection, the buyer could walk away from the sale and keep their earnest money deposit if they don’t like what the inspection finds. After an inspection, the buyer and seller can also negotiate repairs or adjust the purchase price accordingly, depending on the extent of the repairs and what each party is willing to do.

Appraisal contingency

When a home is appraised, it is given a value. This value is important, not only to know how to price the home, but also because the bank won’t loan more than the appraisal says the home is worth. So, if a buyer is offering $10,000 over the asking price but the appraisal says that the home is worth $10,000 less than the asking price, the buyer will have to come up with the $20,000 difference. If the appraisal comes in low and creates a gap between the offer price and the amount they can get for a mortgage, the appraisal contingency could allow the buyer to walk away from the sale.

Home sale contingency

This essentially says that the buyer has a specified amount of time to sell their home before closing on yours. If the buyer can’t sell their home, then they are able to walk away from the sale, typically without losing any of their earnest money deposit.

Mortgage contingency

If a buyer doesn’t have pre-approval for their mortgage, or if they’re worried that something could prevent them from getting the final financing approval, they may include a mortgage contingency which simply states they’re not on the hook to close on the home until their mortgage is underwritten. While this isn’t necessarily a red flag, it does mean another hurdle for you to jump over. If financing is ultimately denied, the buyer won’t be able to buy your house, but this way they’ll get their deposit back if they have to withdraw the offer. Additionally, this isn’t something that can be negotiated between buyers and sellers like repairs or price adjustment. 

red blocks on brown wooden table
The more hurdles a buyer places in their offer in the form of contingencies, the more likely it is for an offer to fall through

Length of time until closing

It usually takes between 30 and 45 days to close on a home after the purchase agreement is signed. During this time, financing is finalized and legal documents are drawn up and eventually signed at the closing. An offer that includes ways to make the path towards the closing date go smoother, and therefore faster, will be more attractive than an offer with more ways to jeopardize the sale like multiple contingencies and shaky financing.

Cash above appraisal

If the appraisal of your home comes in lower than the offer, a buyer’s ability to pay cash above the appraised value gives their offer more stability. If a buyer includes an appraisal contingency, they may not have the funds to cover any discrepancy between the offer price and the appraised price.

Should you negotiate when the offers come in?

It is possible to negotiate aspects of an offer to make it more desirable for you. If the buyer is willing to throw out some contingencies or offer a higher earnest money deposit, it’s possible to work with them and reach an offer you can both agree on. When choosing between multiple offers, this can be a powerful tool to make sure you’re protected and are getting the best offer for your home.

The moment of truth. Which offer will you choose?

After carefully weighing all of the offers, working closely with your real estate agent, and potentially negotiating with certain buyers, it’s time to accept an offer. Making sure that you’ve taken all of these factors into account will help ensure that you’re getting the best deal on your home. 


Should I pick the highest offer?

Not necessarily. While your instinct is probably to look at the dollar signs and go with the highest amount, you should also take other things into consideration, like the number of contingencies, a buyer’s ability to get financing, and if they’re offering an earnest money deposit.

Is the first offer the best?

The first offer isn’t always the best one. When you receive multiple offers for your home, it’s important to weigh them all. And what might be the best offer for one seller isn’t necessarily the best offer for you. Each home purchase is different and offers its own unique set of circumstances and challenges.

What is a respectable home offer?

A respectable home offer primarily depends on the current market and the condition of the home you’re selling. In a seller’s market, where there are more buyers than there are homes for sale, an offer that’s less than asking price probably won’t get a second look. If it’s a buyer’s market (meaning an abundance of homes and not enough buyers), an offer that’s lower than the asking price can be expected. 

If a potential buyer comes ready with a pre-approval for a mortgage, this is a good sign, but far from a guarantee. Another respectable home offer that is lower than the asking price of the home could come from a cash buyer. Cash can make the sale and closing process move more quickly than a traditional sale that requires financing and may also involve fewer contingencies. So, a lower offer may also translate to less time and hassle.

About the author: Stephanie Mickelson is a freelance writer based in Northwest Wisconsin who specializes in real estate, building materials, and design. When she’s not writing, she can be found juggling kids and coffee.

Start your Flyhomes real estate experience.

Buy a new home

Sell my home

Buy and sell