Found your Dream Home? 6 Tips to win a Real Estate Bidding War
Found your dream home but the housing market has you down? Here are 6 tools and strategies JVM offers to our clients to help get their offer accepted for their next home purchase. Bidding wars have been common in our bustling Real Estate markets over the past few years.
As you can imagine, buying a house is very competitive. With the real estate market on the rise, many home buyers are looking to purchase homes, which can result in bidding wars. While it may seem intimidating to face off with other potential buyers, there are strategies you can use to ensure that your offer stands out. Here’s how to win a real estate bidding war.
Work With an Agent
Agents are experts in local market trends because they work with buyers and sellers to help them buy a home or sell property. Have your agent help you determine and prioritize what is important to the sellers and adjust your offer terms accordingly. Do they want to close as soon as possible, or do they need a rentback? Are they prioritizing the highest possible offer, or are they looking for an offer without any contingencies? Your agent can help you put together the terms of your offer.
Get a Pre-Approval Letter
Show them you have done your homework – and submit a copy of your pre-approval letter right from the start. This will show the seller you are serious (and qualified) for this purchase. Pre-approval letters show the seller that your home loan financing has been vetted upfront with the lender reviewing your income pay stubs, tax returns, bank statements, assets, and credit report prior to issuing the letter. A formal pre-approval largely increases the odds of a smooth closing of your mortgage application with your purchase. Oftentimes, offers are submitted with a prequalification which is not as strong as a full pre-approval. Pre-qualifications are based on self-reported information that is not fully verified with documentation prior to issuing a letter for your offer.
Quick Closing Timeline to Compete with Cash
For conforming transactions, JVM Lending can close in as little as 14 days, allowing your offer to remain competitive even next to all-cash offers. By offering to close in 2 weeks, you allow the seller to get their closing funds quickly, making your offer stand out against other offers in a multiple-offer scenario. Review our Fast 14 terms here to see if you are eligible for this product. If you aren’t considering a conforming loan, we can still use speed on our side. We can close our Jumbo loans in as little as 21 days, faster than the market average.
Waive or Shorten Contingencies
When reviewing offers, sellers often consider the likelihood of a deal closing when selecting their winning bid. You should also be prepared to waive contingencies such as a home inspection and appraisal if it makes sense for your budget and timeline. There are important implications to understand when waiving contingencies, please be sure to consult with both your Real Estate Agent and Lender.
JVM Close-on-Time Guarantee
We put our money where our mouth is! A seller’s confidence in a lender can go a long way in getting an offer accepted. To help show how confident we are in your offer, we have a program called our ‘Close-on-Time Guarantee.’ To help get your offer accepted in the midst of the most competitive market in the history of real estate, we rolled out this ‘Close On-Time Guarantee!’
Ask your JVM Client Advisor to Call the Listing Agent
As mentioned above, trust in the mortgage lender goes a long way in winning a bidding war. We want the Listing Agent and seller to have confidence that your deal is going to close. To help tout the strength of your qualification and offer, we love to call Listing Agents. We include our direct contact info on all pre-approval letters and have availability 7 days a week. We are also happy to proactively call Listing Agents, and encourage all Buyers to send over the Listing Agent info and offer details each time they submit. We find that a quick introduction, and review of closing timelines and high level details to show we did our due diligence with a pre-approval goes a long way in helping our buyer’s get in to contract on their dream home. This helps the seller knows they can rely on you (and us as the lender) to close promptly without complications or delays. If applicable, having pre-approval from a lender will also demonstrate that you are serious about purchasing this house and that financing won’t be an issue down the line. Winning a real estate bidding war takes preparation and knowledge of the local market conditions but with these tips in mind, you will have no trouble beating out the competition! By doing your research ahead of time, making an attractive offer, and presenting yourself professionally throughout the process, you should have no problem winning over sellers when competing against other buyers for their property! Good luck!