In hot markets around the country, excited homeowners-to-be are making offers on homes to be quickly rejected for another offer. Even offers above asking price are losing out to higher ones, but that is not the only reason a buyer could miss out.
Show the Seller You’re Serious
When you create your offer, show up with some real cash to show that you’re serious. In a competitive market, sellers might choose a lower offer depending on how it is written and what is included.
One way to show you’re serious is to up the earnest money. Bringing a larger amount of cash to the table up-front shows that you are serious and want to buy that property.
Have Financing Lined Up
In a competitive market, you have to show that you have already begun the financing process and have a willing lender on standby with the cash. When I bought my most recent home, we took all steps to get a mortgage before we started seriously looking at homes.
You can show the seller that you have financing through a pre-approval letter. Note that a pre-approval means you are approved for a loan pending finding the right property. This is different from a pre-qualification, which tells the seller that you are working with the bank, but have not been formally approved. A pre-approval is much better than a pre-qualification if you are competing for a winning offer.
All Cash Offers are Even Better
Want to skip to the front of the line? Come with an all cash offer. Once a home goes under contract, it is up to the buyer to come up with the money in time for closing. Financing falls through for buyers all the time, and sellers know that there is some risk of a sale not closing when financing is involved.
If you have an all cash offer, there is no need for an appraisal or waiting on a mortgage company to approve the loan. It is just between the buyer and seller. Even if the offer is a little lower, an all cash offer can be the winning offer.
Timely Responses are Crucial
When you are ready to make an offer, get all of your ducks in a row and send it off as quickly as possible. You have no idea who else is interested or how many offers they might get.
I pulled up one Portland address last fall and sent it to an agent to set up a visit. By the time she responded the next day, the house already had three offers. It had been on Zillow for one day.
Make sure you are prepared to move quickly, and make sure you have a responsive Realtor who can meet your needs.
Your Agent Plays a Big Role
Your real estate agent is your biggest ally when searching for a new home. In a competitive market, you should be a team. When I have been looking for homes, I would check MLS apps every day, and my agent would send me new listings each morning.
Together, we were able to find the right property. If you are looking for a quality agent, start your search with our list of qualified agents today.