If you’re in the market for a house then you may have noticed in some areas that the supply of houses is low while the demand is high. This can typically result in a bidding war which can drive the purchase price higher. While this may seem scary, competing in a bidding war just requires a little preparation. You need to familiarize yourself with the property values in the neighborhoods and decide what you want. Sometimes, it’s not the highest offer that wins, but instead it’s the offer that is most likely to go through or that meets the seller’s conditions.
Let’s look at a few things that can help you win the bidding war:
Pre-qualification letter from your lender
You can improve your chances of winning a bidding war by securing a pre-qualification letter from your lender. Submitting all financing documents to your lender before looking at homes or writing an offer, allows you to move quickly when you do find the perfect home.
Service First has a robust suite of loan products to meet the various needs of borrowers, and even has a mobile app which allows you to complete your loan application directly from your phone! If you have any questions about pre-qualifications, a Loan Officer can walk you through each step of the process.
Be flexible on the closing
If you’re able to be flexible on the closing date, you may be more attractive to a seller. Pushing the close date out to give the seller more time to move out, or even renting back the home to the seller for a period of time may be beneficial for them. They can avoid being pressed for time to find a new home. Likewise, for a home that is already vacant, being open to close quickly could help lessen the burden on a seller.
In a multiple bid situation, the seller has the upper hand and will tend to avoid offers that are complex and time consuming. If you know there are additional bids coming in, avoid making too many demands or adding too many contingencies. Sellers will lean more towards offers that are clean and to the point.
Write a letter to the seller
Sometimes, making a personal connection with the seller is all that’s needed to win the bidding war. Take the time to write a heartfelt letter to the seller explaining why you feel their home is your dream home. Appealing to their heart might just be what’s needed to make your offer stand out.
Keep in touch just in case
Don’t count yourself out if you didn’t win – the highest bid could still fall through. Have you Realtor® keep in touch and continue expressing your interest in the home.
A little preparation and determination can go a long way in the bidding war. Give Service First a call today and we’ll get you one step closer by assisting you with your loan options and pre-qualification.