Offering more than your competition, or removing contingencies has always been a way to beat the competition, but there are a few other things you can do to put yourself at an even greater advantage.
- Get pre-approved before you start looking at homes. Looking at homes without knowing your mortgage options and buying power could lead to disappointing results. The worst case is falling in love with the perfect home and then rushing to try and get a pre-approval and losing out to another buyer who already had their financing in order. Another situation that could happen is that you find out that you cannot actually qualify for the price range you are looking at. It’s best to work with your lender and get pre-approved first and then start looking for homes to avoid disappointment. Even if you don’t plan to buy for a while, it’s best to be ready to make offers at the drop of a hat, if that perfect home happens to comes along.
- Work with a local lender. Listing agents will often call your lender to verify that you have really been pre-approved. If your lender is not open after hours, or on weekends to take that call and put the listing agent at ease, your chances of winning that offer is greatly reduced.
- Choose your team early. Your loan officer and realtor are the two most important people that guide you through the home buying process. If they are knowledgeable, professional, experienced, and they return your calls and emails in a timely manner, this is what you can likely expect once you go under contract. Making last second changes to your team once you go under contract could be a big mistake. As an example, changing to a new lender that you have no history with yet, could put your earnest money and future home in jeopardy. The best rule of thumb is to stick with the team that has already earned your trust and has a proven track record with you.
- Avoid a home-sale contingency. Sellers get nervous when they have to keep their fingers crossed on two sets of lenders and buyers. Selling your current home first, or selling your home afterwards will make your offer look a lot more attractive.
- Pre-inspect the home. You’ll pay the cost of a home inspection; however, if the inspection checks out and you’re still interested in making your offer, you can then make your offer without an inspection contingency. This tells the seller that you won’t be asking them to make repairs once you are under contract.
- Write a letter to the seller. Some sellers, especially sellers who have lived in a home a long time and who are very sentimental about the home, may look more favorably in selling the home to another family that will take good care of it. This is not a full proof plan of course, since money talks, but in some cases, you can put your offer over the top if you’re able to reach the seller at a sentimental level.