How To Have Advantage Over Other Home Buyer
With shrinking inventory and a competitive market home buyer more and more find them in a multiple offer situation and many times loose out on the home they had there eye on it. It is important that buyer in today's market understand how they can have advantage over other Home Buyer:
1) Be pre-approved: There is a difference between pre-qualified and pre-approval for a mortgage. Many agents are satisfied with a pre-qualification while they think it will be enough for a seller. Not any longer - since a pre-qualification means nothing any more. With a pre-approval you had your consultation with a loan officer, your credit has been checked, and your terms are set in regards of to the mortgage you can afford and interest rates. This shows to any seller that you can go forward with your purchase and will be more open to consider your offer and will give you advantage over other home buyers without a pre-approval letter.
2) Make a clean offer: Many times we see and receive offers which are written without care and consideration to all parties involved. We receive handwritten offers, which is not a bad thing, but which are hardly to read and are a total mess. In today's technology offers can be written on smart phones, i-pads or other technical devises and don't have to be messy at all. Your offer will be the first impression to a seller, and if nobody can read it or important information are missing - why should a seller take the time and consider your offer. It its the first impression that counts. Make sure your agent understand that and has the technology to present you as a buyer in today's competing market.
3) Don't Low Ball: The time for low ball offers has passed and who didn't take the chance back when it was a buyers market shouldn't try it now. This times are over and we have returned to a sellers market. If you really want that home where you make an offer on it, it could be your only chance you get - so don't low ball it. Take a look at the comparables in the area and compare the homes with each other in square feet, condition and amenities and make your best over based on those information. A fair consideration and a fair offer will give you the advantage over other home buyer while many still are under the impression its a buyers market and low ball overs are common. They couldn't be far from wrong!
4) Write an escalator clause: To give you another advantage in today's market let the seller know that you understand that there could be other offers on the home and that you are willing to rethink your offer if a higher offer is presented to the seller. A good buyers agent knows how to write those escalation clauses and knows how to protect you as the buyer if no other offer is present.
5) Earnest Money Deposit: Always present with your offer a good earnest money deposit. That means not only a minimum off $500 but a reasonable amount that the seller understand that you are serious and committed to the deal. Many seller require a certain amount as Ernest Money deposit and you should consider to double your deposit based on that amount.
6) No Contingencies: If possible don't use contingency clauses and/ or avoid when possible. I understand buyers want to protect their investment and need appraisal approval and inspection to insure the condition of the home. When you need a financing contingency it is more important to show the seller that your are willing to minimize the risk that the deal falling apart, with putting a higher deposit in escrow.
7) Get personal: Yes, the personal letters are back. More and more home buyers using this tool again and letting the seller know on a personal level why they have chosen the sellers home and why they have fallen in love with it. It is a personal touch to the seller and they will understand since they had their own family history in that home.
In a competitive market a buyer should consider this tools and their agent should advise and assist their clients and costumer to make sure how their buyers have advantage over other home buyer and secure the home of their dreams.