Skolnick's Scoop / Being ready to make an offer
Published 12:43 pm, Thursday, January 3, 2013
Unless you have had your head in the sand at Compo Beach, you already know that it is a buyer's market for home sales. Reduced asking prices, coupled with historically low mortgage rates, have sparked enthusiasm into Westport's residential market.
But the properly priced home in the right location is once again drawing traffic and even bidding wars. Educated buyers should be prepared to put their best feet forward if they want their offers to be accepted.
Things for buyers to keep in mind:
Price: Clearly, price is one of the primary considerations when a seller is reviewing your offer. If you find yourself in a bidding war, consider offering the seller a premium of a set dollar amount above their highest offer.
Financing: Before you prepare an offer, it is important to meet with a mortgage lender. It doesn't matter to the seller if you speak with a mortgage broker or the lender directly, as long as you are pre-qualified. However, a pre-qualification will only take you so far. This shows that you can afford the property based on the information that you have given the lender. However, a pre-approval goes a few steps further. A pre-approval verifies your employment and your credit history. You can be cleared for a pre-determined maximum loan, allowing you to make a "mortgage contingency free offer," which reduces the seller's risk greatly, in essence making your offer more appealing.
Good-faith deposit: When a potential buyer offers a larger than the customary 1 percent earnest-money deposit with an offer, it will certainly gain a seller's attention. It can demonstrate the buyer's motivation and ability to accumulate funds quickly.
Contingencies: Minimizing contingencies and clauses that make it harder for the buyer to cancel the contract once inspections and financing is secured will go a long way to prove to a seller the buyer's desire for a smooth transaction. Certainly a first time buyer or renter is extra appealing to a seller, so the sale of their current house does not complicate the timing or ability to close.
Build a relationship: Try connecting with the seller on some level. Of course price, terms and contingencies are always going to prevail, but if all else is comparable, a seller tends to like accepting an offer from people that they have met, and who they believe will take good care of their home.
Realtor advice: Trust a seasoned Realtor to know the best way to position your offer. Whether you are planning to purchase your dream home or an investment property, knowledge, skill and your agent's expertise will help you facilitate making a sound offer that, when realistic, will lead to an accepted offer.
Linda Skolnick's "Skolnick's Scoop" appears every other Friday. She is a Realtor with Coldwell Banker Riverside in Westport and can be reached by calling 203-246-0088 or by through her website, www.GoAskLinda.com.