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Here are some tips a and tricks on how to win an offer of your dream house. Being a realtor from Toronto for over 25 years, I know how much frustrating it can be when you end up bidding against 15 or even more interested buyers. 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 cash.
Get pre-qualified
Prospective clients who can get pre-qualified for a bank loan always have a better chance of getting the deal than candidates without a proper financial background. The house owner has to be sure that you are able to pay for the house – when your financing is not clear, all the other advice will not help.
Find out the seller’s preferences
Try to find out about the seller’s preferences, 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. If you cannot accept them, walk away. On the other hand, if you are willing to meet them, have your agent to prepare a summary that will accompany your offer. This will give you an opportunity to present yourself to the seller and enhance the strong points of your offer.
Don’t underestimate the price
The last thing you want to do is to upset the seller by your low-ball offer, because the seller most likely will rather sell it to almost anybody else then you. Offering a better value later might not even help in this case. It is recommended to bid about $1,800 to $4,800 more than the highest expected proposal. For example the most the owner expects is about $470,000. Round it off to $473,164 – don’t limit yourself to an even number!
The deposit
A nice large down payment of 10% to 20% always makes a good impression. After having signed the purchase agreement, it is usually possible to arrange with the seller on the exact value you have to pay in advance. What really matters is the money at the table when you close so that your contract makes a good impression.
Earnest money deposit
The next practise is quite aggressive but has some great results. Pay the earnest money deposit as high as you can afford, as part of the down payment. The earnest money deposit would be lost if you change your mind later and decide not to go through with the deal. It doesn’t matter to you anyway, because the earnest money deposit is the ground of the down payment in any case, but for the seller it means a lot. If you do this, the seller understands you have a serious interest in buying the house. This means that the earnest money deposit serves as a measure of your real interest in buying the house, regarding the fact that after signing the contract, you can usually change the amount of the down payment.
Propose a short rent-free stay
It may be a good idea to offer a free stay to the seller in their house for another one or two weeks after selling it. You can mention this in your letter going along with your proposal. Normally you would negotiate rent, but giving the option of free occupancy for a short period of time might be the detail that decide whether the seller will go for your offer or not.
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Very nice post. This will really help a lot. Thanks for this tips and tricks.