June and July are 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 or accept a counter-offer.
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 offer to purchase. 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 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. Consider placing even more money in escrow when the contingencies have been met.
- Specify a closing date in the contract but acknowledge that you can be flexible to accommodate the sellers' moving date. If it becomes an issue, it still must be mutually agreed upon.
- Make the contingency periods shorter if possible to make the seller feel that they'll know sooner that the offer is solid.
- 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.
- Write a personal note to the seller explaining why you like and want their home. Consider including a picture of your family and pets.
- If you're not using a digital contract, physically sign the offer with a felt tip pen of contrasting color. You'd be surprised how this adds a personal touch to the offer.
One way to eliminate the competition of multiple offers is by not procrastinating. When you have decided to write a contract, don't wait; do it immediately and ask your agent to deliver it quickly. 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.