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After some serious house hunting, you’ve finally found the home of your dreams in St. Louis. However, your agent has some bad news – yours isn’t the only offer. What do you do to ensure you get the house? In a competitive market such as St. Louis, it’s no surprise that you may have to engage in a bidding war. While there’s no guarantee you’ll win, here are some things you can do to make sure that you present the strongest offer to the seller:
Increase Your Offer
Money talks, so increasing your offer if you’re able to is a solid start to swing the pendulum in your direction. If you’re obtaining a loan for your home purchase, you need to be aware that the lender will base your loan amount on the appraised value of the home, not the amount on the purchase contract. Be prepared to pay for the increase out of your own funds in case the appraised value comes in at lower than expected.
Sellers are looking for a strong buyer to ensure the process is smooth and secure. Providing a letter from your lender showing that you’re pre-approved for a mortgage can ease the seller’s mind. Requesting the letter from your lender with the information specific to the actual property shows the seller that you have a vested interest in purchasing their home.
Write a Letter
While money plays a large part in the decision making, the seller may also have an emotional attachment to the home. Writing a personal letter talking about the things you love about the home will humanize your name on the contract and also make sure you’re more than a name in a sea of bidders. Be open, honest, and display your emotions about the home. If you want, Include a photo of you and your family. To sellers that have a strong connection to the property they’re selling, a letter and photo may make a positive impact.
Waive the Inspection
This one is a gamble. The home inspection can uncover issues with the home that can add up monetarily in the long run and therefore can also be a point of renegotiation during the closing process. If you’re confident that the home has been well maintained, waiving the home inspection can be a real deciding factor for the seller. There’s a possibility that the seller has conducted a previous inspection that they’re willing to share. While this may decrease the gamble, the risk that there are underlying issues is still there. So, if the home has had little maintenance and looks as if it’s in need of some TLC, a home inspection should still be done. In this scenario, try and get the home inspection done as soon as possible.
Offer a Speedy Transaction
When a seller puts their house on the market, they are often purchasing a new home in the same time frame, which can be stressful – no one wants to pay two mortgages. For most sellers, the close date is a significant factor in choosing their potential buyer. Talk with your realtor and lender and determine a realistic close date that will please the seller.
No one wants to deal with a bidding war, but in a competitive St. Louis market, it may end up being a reality. Talk to your real estate agent and figure out the best strategy for you and your situation. Determine what will fit the needs of the seller and you’re sure to be a strong contender. What are some experiences you’ve had in a bidding war? We would love to hear from you.