Why Reading Love Letters May be a Bad Idea When Selling Your Home.

In our highly competitive seller’s market, love letters are being used by more and more home buyers in an attempt to get their offer accepted.  Love letters have become so popular that companies are advertising on the web on how to write a winning love letter.

The use of love letters may be a reasonable strategy for the home buyer who is trying humanize themselves to the seller.  However, it may be a bad idea for the seller to read these letters.  Note: the information contained is not to be considered legal advice.  If you have questions about love letters and your individual situation, please seek advice from a qualified attorney.

So what is the harm in the seller looking at a buyer’s love letter?  After all, the home selling process is an emotional process and many sellers want to know who the buyer of their cherished home is going to be.  When we sold our first house, we were interested in who was going to buy it.  Not because we wanted a certain person to live in it, but because we were hoping the new buyer would love the house and create great memories like we did.  Love letters become problematic when the seller takes a lower offer and/or one with less desirable terms.

If a seller ratifies a less desirable offer from a buyer who included a lover letter, the losing buyer(s) could claim that the seller favored one buyer and hence discriminated against the others.  The losing buyer(s) could file a fair housing complaint or lawsuit.  Love letters may consciously or unconsciously bias a seller’s decision.  It is best to have a frank conversation with your real estate professional regarding love letters and their relationship to fair housing discrimination.

How I handle the love letter process:

1. I advise my seller(s) about the offer process and what love letters are designed to do.
2. I advise them of the potential consequences in reading love letters.
3. I educate them about fair housing laws and the 22 categories of protected classes.
4. I remind them that their decision should be based on objective criteria like down payment, verification of funds, loan amount, buyer/buyer agent expertise etc. and not who is buying the home.

FYI, In my 28+ years in selling homes locally, I have found that love letters typically come from buyers who don’t have the financial resources to compete.  I usually can predict the strength of the offer by the buyer’s desire to submit a love letter with the offer.

If you have any questions or comments reach out to me at [email protected] or directly at 650 465-0755.  Until next time, Take care!