If you scan the ads in the paper, monitor internet advertisements and review listings in the Multiple Listing Service, sometimes, just sometimes, you might see a listing begin or end with the description, "Motivated Seller." Now we all know that at times, the use of this phrase can be nothing more than slick advertising while other times it is genuine, truthful marketing. Personally, I often take this to mean the seller IS really hoping to find a buyer. For a prospective buyer that can be great news when getting ready to make an offer!
I've discovered a seller's incentive to be a "Motivated Seller" can originate from a variety of possible reasons. Perhaps there has been an ARM Mortgage involved and the sellers can no longer afford the ever increasing payment structure or, for whatever reason cannot refinance their house. Maybe it is a couple that is divorcing and the sale is part of the settlement. Possibly it is a grown child trying to sell the home of a parent who has recently passed away. Sometimes a job reassignment is the reason for selling, while other times perhaps someone has lost a job in the family and now the mortgage payments are simply too high.
Whatever the incentive, a true "Motivated Seller" is more likely to negotiate on price and terms. This type of seller might take far less than the asking price or be willing to make major concessions in order to seal the deal. If the buyer is looking to act and move quickly this can also be a means of not haggling over price and quickly reaching a deal.
In reality, there are few sellers who like to publicize the fact that they need to sell a home so desperately. As a result, it is up to you and your real estate agent to do a little research. Ask, is the house vacant? Find out how long the home has been on the market. See if the price has been reduced. By all means, do the obvious - ask the seller or his agent why the home is up for sale. Maybe they will and maybe they won't tell you, but it never hurts to ask. The answer may help you judge how far you can undercut the asking price or what kind of terms you can request. Knowledge can be power when trying to buy a house.