In today’s fast paced seller’s market a buyer should consider following these steps in order to position themselves for success in order to prevail in any competitive market throughout the country.
1. Obtain A Pre Approval Letter
2. Do Your Homework: Investigate, Inquire, Research
3. Draft A Love Letter to the Seller
4. Personal Presentation of the Buyer’s Offer by their Realtor
5. Touching Base, Offering Reassurance by the Buyer’s Lender
If you are seeking to buy a home in today’s highly competitive market you may consider following these 5 tips that have made our own Buyer’s successful in their quest to win the bid and purchase a home.
Tip 1: Any homebuyer seeking to purchase a home must be pre approved for a loan. In over 22 years of transacting real estate, each offer I have written and submitted on behalf of a Buyer all were accompanied by a Pre Approval letter. A Pre Approval letter is different than a Pre Qualification letter. A Pre Approval letter provides more leverage for a Buyer and is not an option in a Seller’s market. A pre approved Buyer is one where the lender or mortgage broker has received a full package from the Buyer detailing the Buyer’s financials including but not limited to tax returns, W2’s or 1099 and a complete credit report. (This will vary depending on each Buyer’s own circumstance.) The lender or mortgage consultant will submit the Buyer’s financial package to their underwriting department for final review and approval. Being Pre Approved is really not an option if a Buyer hopes to purchase a home in a competitive market.
Tip 2: Buyer’s must do their homework ahead of time. A serious Buyer must read the disclosures provided, ask questions, and obtain a complete home inspection or individual inspection on any system that may be a concern such as the foundation or asbestos ducting. Once a Buyer has identified a home they wish to make an offer on they should have their Realtor obtain a Disclosure Packet from the listing agent. Not all areas or regions provide a packet as we do here in the East Bay, but this custom is becoming more prevalent in other markets as well. A Buyer should read through the Disclosure Packet, ask any questions they may have right away, allowing their agent time to obtain the answer(s) from the listing agent or book an inspection with the appropriate inspector. In many cases a Buyer will pay $500-$900 to have a home pre inspected before their offer has been submitted. It’s a strategy that positions a Buyer for success. It doesn’t always work, but if your offer price is competitive and you have waived your inspection contingency you have a better chance of winning.
Tip 3: Buyer’s should write a Love Letter to accompany their offer which will be presented by the Buyer’s agent.
Dear Bianca and Chase,
My family and I truly fell in love with your home the very moment we stepped over the threshold. We just knew it had to be ours ….
Writing a love letter to the Seller has become commonplace in our market. A well written, heartfelt letter addressed to the Sellers oftentimes is the difference between winning the house or losing it. It may sound silly or unnecessary, but it can make a difference. I find myself sharing these two stories quite often, where a simple letter made a big impact. The first story I love to share is when my husband and partner Adam Betta presented an offer on behalf of his clients and their offer was $100,000 less than the highest offer. But because of Adam’s personal presentation and the Buyer’s personal love letter they prevailed. On the flip side, my clients did not win their dream home as their love letter did not tug at the heartstrings as much as the other Buyer’s letter did.
Tip 4: Nothing replaces the efforts of that personal touch.
As briefly noted above, a Realtor should always try to present their Buyer’s offer in person. That personal touch is important and is oftentimes what separates the winner from the loser. It’s fairly simple but some agents do not take the time, and others do not feel it’s warranted to present in person. We believe it is valid and a strategy we find positions our Buyer’s for success time and time again.
Tip 5: The Buyer’s lender should go the extra mile by offering assurance as well as providing that personal touch by calling the listing agent to touch base. Partnerships and teamwork are the cornerstone of our success. And our success is based on what we do and how we guide our clients for their success. Not only must agents lobby on behalf of their clients by keeping in touch with their lender but should continue to pursue and court the Listing or Seller’s agent by keeping in touch and letting them know how much their Buyer is enamored with the home. Likewise, we ask our Buyer’s lender to make the same personal connection with the listing agent right after we present our offer. This allows the listing agent to better understand and get a clear financial picture of the Buyer. It also demonstrates the professionalism of the mortgage consultant creating a sense of ease and confidence. As a listing agent I find it very helpful knowing the Buyer’s lender is at the top of their game, accessible, easy to work with and forthcoming.
Of course nothing in life is guaranteed, but by following these 5 strategies a Buyer will be in a better position for success. Stick to the plan even when you think it’s a waste of time. You just never know when the planets may align, so be prepared. For more tips go to www.TheArtofRealEstateBook.com to learn more.
If you have questions about this topic or others, please comment below. I look forward to assisting you.