Jun. 24, 2009

Tips how to win the real estate offer

Here are some tips a and tricks on how to win an offer of the house you've always wanted. For a worthwhile house, it is not unusual to have 15 or even more candidates in the competition, which can be very disappointing for an inexperienced buyer. I know this very well from my daily work with clients, being a real estate broker for more than 25 years. Well, I cannot make sure that even if you follow my advice, you will finally win the offer, but anyway it might be useful for you and even save you some money. (picture by on1stsite)

Important: Get pre-qualified

Prospective clients who can get prequalified for a bank loan always have a better chance of getting the deal than candidates without a proper financial background. Of course, it wouldn't make a good impression if your financing was not sure and the vendor found out about it - in that case all other tricks won't be able to save you.

Explore the seller's wishes

Try to find out about the seller's expectations, as it would be a waste of time if there were some details that you were not able to meet. It is therefore advised to find out all the prerequisites accompanying the sale of a property you want to bid on. It is better to stop trying in case you find out you are not able to meet them. However, if you can satisfy all the requirements, contact your realtor and ask for help writing a letter to go with your bid. That will give you a chance to let the seller find out more about you and will highlight the positive aspects of your offer.

No low-ball, no even cut off marks

Now it is important not to propose an offer that is significantly below the fair price of the home, as this would probably make you an unsuccessful candidate and the seller would choose another buyer. And that's even if you deliver a comparative offer in a later stage. Thus the best way is to offer around $1,800 to $4,800 more than the highest estimated bid. For example the most the owner expects is about $470,000. Try adding some money and come to $473,164 - the offered price doesn't have to be an even number!

The deposit

The usual, best looking amount of the deposit is between 10% and 20%. Of course in most cases you can try to bargain the final amount of your down payment with the seller after the contract has been secured and usually with a success outcome. The crucial point is that you actually pay the deposit after you sign the contract, otherwise you wouldn't seem to be a respectable buyer.

Good faith deposit

The next technique is quite aggressive but produces some great results. Try to make the earnest money deposit as big a part of the down payment as possible (this deposit is not returnable if you back out later). You have to pay this money anyway, as the earnest money deposit is included in the down payment, but it sends a strong signal to the owner. It tells the owner that you really want to go through with the deal. After closing the business, you can usually rearrange the down payment value, so what matters here is the good faith deposit, showing how interested you really are in the property.

Come up with a free lodging offer

In the summary accompanying your offer, propose a free-post occupancy agreement to the seller in case they need a week or two in the property after it's been sold to settle their affairs. This might be the final aspect that plays for you to win the deal, as in a different situation the seller would have to pay some rent, being no longer the owner of the property.
And finally some dream home tips...

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