You have been house hunting for months. Finally you see it, the home of your dreams is on the market! Calling up your local agent you rush out to see the house. It's more impressive in person and you know this is the one. This is your lucky day! Whipping out your checkbook, you put down some earnest money and place an offer to purchase. Now you sit back and wait for the good news.
When it's a Seller's Market
In a Seller's Market it is common for a home to get multiple offers. You may wonder if it's even worth competing and the answer is yes! Someone will be the winning offer and it could be you.
Here are some tips to make your offer as strong as possible.
Submit an Earnest Money Deposit
When receiving a lot of offers, many sellers worry that a potential buyer may back out. Leaving them to start back at square one if all the other buyer's move on. Earnest money is part of your down payment. It also shows the seller that you are serious if you have a larger earnest money deposit than the other potential buyers.
Ask your lender for a loan pre-approval letter. Having your offer accompanied by a lender letter shows that you are a stronger buyer than the rest.
Sell Your Existing Home First
It may not always be a possibility but this can tie things up. The seller may not be willing to wait for your house to sell. If you are a first time home buyer you may have the advantage over another offer who has to wait for their house to sell before they can proceed with their offer.
Shorten or Waive Some Contingencies
You always want to get a home inspection but try to keep the time period to a minimum. You might have the option to waive certain loan contingency depending on the type of loan. It's a good idea to talk to your agent about all the options.
Offering to Bridge the Gap Between Appraisal and Sale Price
If you think the home might not appraise at the price you are offering you can always offer to pay the difference in cash. But this may not be something you want to do unless you have a little extra on hand.
Play Nice and Give the Sellers Time to move
It can be challenging to juggle multiple closings when you're selling and buying simultaneously. It's always a nice gesture to the seller to give them a few extra days to move out after closing.
Show Some Love
Some people have an emotional attachment to their homes. They want the buyer to love the house just as much as they do. Writing a brief letter the to seller explaining why you are in love with the home can help sway some hearts. It may seem a little sappy but trust me, it can work!
Counter Offers and Bidding Wars
Even after writing the best offer possible you may still receive a counter offer. It is possible the seller made a verbal counter offer to all the bids. Each state is a little different and the sellers do not have to make identical counter offers.
You may be tempted to raise the price again and again to win. But remember to ask yourself: Do you just want to win or do you really want the house for that much? Avoiding a bidding war may be the best option. It is important to make sure you are still comfortable and happy with what you offer on the house.
For more ideas it's best to get in touch with your local agent. They know the market and will help lead you on your home buying journey. They may even have a trick or two up their sleeve! Laws can change state by state. So it's always best to have an agent to help you to buy your future home!