June and July are two of the busiest home sale months of the year. When inventory is in short supply and you may be competing with other offers, it is important to show the seller you’re serious. Make your offer look as good as possible because you may not get the chance to make another offer or accept a counter-offer from the seller.
Put yourself in the seller’s shoes. Your home has just gone on the market. There is lots of activity and suddenly there is more than one purchase offer. The seller’s first consideration may be to accept the highest offer, but there are many other things to consider like closing dates, closing costs, possible repairs, contingencies, and of course the ability of the borrower to get a loan.
Offer a fair price for the property in your initial purchase agreement. It shows sincerity and good faith that you’re actually trying to purchase the home and not trying to take advantage of the seller. The old adage that you can always go up later may never happen if there are multiple offers on the property in the beginning.
- Remove the seller’s uncertainty that you may not be approved for a mortgage by having a pre-approval letter from your mortgage company.
- Show your sincerity by increasing the normal amount of earnest money customary for the area and price of the home. The earnest money will be applied toward your down payment and closing costs. You might also consider offering to place even more money in escrow after the contingencies have been met.
- Specify a closing date in the contract (you must), but if in fact you can, then acknowledge that you can be flexible to accommodate the sellers’ moving date. Once a closing date of the contract is agreed upon, any change to it must be mutually agreed upon.
- Make the contingency periods shorter if possible so that the seller will know sooner rather than later that the contract with you is on solid ground.
- If the contingency really isn’t important to you, leave it out of the offer. The more contingencies included in a contract, the more the seller will wonder what might happen to keep it from closing.
- You MIGHT want to write a personal note to the seller explaining why you like and want their home; and or consider including a picture of your family and pets. Discuss this with your agent though; these kind of personalized touches come across well to some sellers and backfire with others.
One way to minimize the odds of competition with multiple offers is by not procrastinating. When you have decided to write a contract, don’t wait; do it as swiftly as is practical. Your agent will be able to help you craft a solid offer that makes you look serious and can give you advice that may be unique to your situation.