Tips to get sellers to choose your bid
In a hot market, most home sales end with multiple offers – if not an all out bidding war. If you’re in the process of buying a new home, the idea of directly competing with other bids can be intimidating. However, there are ways to make your bid stand out – and get the home of your dreams. The following tips can help you get sellers to choose your bid.
- Waive contingencies
While not always possible, waiving any contingencies on a sale can make your offer more attractive. “Don’t include things like needing to wait for a spouse or partner’s approval, asking the seller to purchase a home warranty or requesting that the seller leaves or repairs certain items,” says Bruce Ailon, an Atlanta-based real estate agent. “You also don’t want to ask the seller to pay your closing costs … Having too many of these items in your contract will make it likely that a seller tells you ‘no’ over another offer.”
- Get preapproved
Getting prequalified for a mortgage is not the same as getting preapproved. While prequalification is how much a bank is willing to lend you based on your credit, preapproval is a statement from the lender about a specific property. Having all of the financial documents submitted to your lender in advance can make getting a statement of preapproval easier, especially in a hot market where properties move quickly.
- Add an escalation clause
An escalation clause can make your offer more attractive, especially in a multiple-offer situation. In the clause, state how much you’re willing to incrementally increase your offer by to a capped amount. For example, if you offer $300,000 on a house, the escalation clause might state you are willing to increase by $5,000 over competing offers to $315,000. “You can also allow your bid to be held as a backup offer for up to 20 days if the higher bidder makes an irrational offer and doesn’t deliver earnest money or stops payment,” Ailon suggests.
- Include a personal letter
When all else fails, consider writing a letter to the sellers from the heart. Most sellers still love their homes, and want to make sure it goes to a family who will care for it as much as they have. “I definitely ask my buyers to write a letter and explain how much it would mean to them to get the house,” says California-based agent Eileen O’Reilly. “I even have them add a couple of photos of them and their kids or pets. I’ve had selling agents tell me that it was the letter and the complete offer packet that won my clients the listing.” And don’t forget to clean up your online presence in the likely event the sellers Google your name!