Losing out on a home you’ve offered on is upsetting. Especially when it happens more than you care to count. Thoughts of potentially making this house your home, only to have another buyer swoop in and make an offer more appealing to the seller – stinks! Securing your dream home is about timing, contract terms, and submitting the strongest offer possible. With inventory at record lows, makes for a lot of competition. It is crucial that that you make your offer stand out. Below are some suggestions to help increase your chances of getting it accepted.
Offer Price: Getting the highest sales price is what sellers look for in an offer, but it may not always be the determining factor. Having your Realtor ask the “right” questions of the listing agent prior to making your offer may disclose determining factors that could appeal to the seller, which knowing, could give you an advantage to the seller accepting your offer. Properties with multiple offers are more common now and you may only get one chance to make your offer. Prior to structuring your offer, your Realtor should ask the listing agent if there are multiple offers, and if so – how are they being handled? Knowing whether you should submit your “highest and best” – or will you have the opportunity for a second go-around.
Higher Down Payment: Now more than ever, it’s important to let the seller know that you are a serious buyer – nothing speaks louder than a high down payment! If you are using lender financing, the more money down the more likely your loan will be approved.
Contract Terms: All things equal, sellers will likely choose the offer with the strongest closing terms. An all-cash offer can close quickly may be more appealing than lender financing. If you have the means to liquidate accounts, now may be a good time to do this. Having that in place enables you to act fast when you see a property you like. If this isn’t an option, work with your lender to get as much of the underwriting done prior to finding a home. This can take weeks off the approval time.
Waiving Contingencies: Contingencies are potential obstacles that could make or break the deal. The more contingencies you can remove upfront, the more appealing your offer will be. Understand, there is a fine line between making a reckless offer and knowing what to eliminate. Having those conversations with your Realtor and/or attorney will help you determine if this makes sense to do.
The following are standard contingencies put in every contract: Inspections; appraisals; and financing …
If you are doing a total renovation, the inspection may not be that important.
Waiving the appraisal contingency could assure the seller that if the appraisal comes in low, you will still purchase the home, even if that means bringing more cash to the closing to cover the difference!
When financing a home, the larger the down payment, the more appealing it is to the seller. While CASH is King as they say … most do not have luxury.
Understanding what’s important to the seller is key, along with eliminating any contingencies that may make your offer more appealing to the seller when possible.
Buyers need to act fast in this market if they want a shot at securing the home they have been searching for. Speak with your Realtor as he/she may be able to pull that “needle out of the haystack” prior to the home ever hitting the market – thus not having to get involved in a potential bidding war. I have had success with this myself. As a Realtor, knowing your clients wants and needs allows us the opportunity to “make a match” that benefits both parties!
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