Scenario: You walk into a home, fall in love with it, and immediately write an offer. The next day you find out there is a multiple offer situation. What do you do next?
Here are five ways to make sure that you have the best chance at getting your offer accepted before you even step foot inside a home.
1. 1. Don’t look at houses that are at the top of your price range! If you are searching for homes that are already above your maximum affordability then when there is a multiple offer situation you will not be able to compete!
2. 2. Get pre-approved not pre-qualified. If the only thing a mortgage person has checked is your credit score, you have been pre-qualified. That doesn’t provide much comfort for home sellers. They want to know you are highly qualified to purchase their home. Make sure to ask your mortgage person for a pre-approval that states your assets and income have been verified.
3. 3. Opt for Conventional financing if you can. The FHA loan is very popular because it is only 3.5% down and that is very attractive. However, there are some lenders offering 5% down conventional loans now and that could be more attractive to a home seller. The reason is that FHA is strict with their appraisal guidelines and often times there are repair issues that will have to be fixed prior to closing. That’s one more hurdle the seller has to jump through.
4. 4. Get a gift rather than ask for closing costs. If you have the ability to get a gift from a family member rather than asking the seller to pay for closing costs – opt for that solution. Closing costs can be expensive but as things getting more competitive, sellers are going to be less willing to pay for closing costs.
5. 5. Use the minimum number of days for your contingencies. For a home inspection put 10 or 7 days to be completed rather than 15. Offer to close in 30 days rather than 45 (YES there are plenty of lenders who can close this quickly).
6. 6. Offer market value. Don’t try to undercut the seller. The times of low balling an offer is over. If you see a home in good condition and priced well be willing to pay what the home is worth. We can help you determine the appropriate market value and give you a range that makes sense in the current market conditions. Don’t use Zillow for this!
All of these types of items will ensure you have a solid offer to present to the seller. Now if someone comes in and makes a cash offer and above list price you are going to have a tough time competing. At least you will know you gave it your best shot if you follow the tips above!
One last tip - offer a written letter to accompany your offer about why you hope to buy the home. This may not help with a over list price multiple offer situation - but it does make a difference. Sellers are human beings and the emotional connection could help you stand out in front of very similar offers.Call us today to learn more about buying a home in Downtown Orlando, College Park, or Winter Park Florida. 1-800-859-5714 ext 0