Making the Right Low Offer!
If you are the type of person who likes to negotiate you purchase prices to the bare minimum, you may be able to “wing it” at a garage sale, but if you are going to buy a house, you will need to get some training. Yes, you weigh all options and do your research on everything you buy, and buying real estate will be your dream come true because everything is negotiable.
This does not mean you submit a lowball offer that may insult the seller. This means you do your homework and make a legitimate offer that your agent can work on. Here are some tips that can help you make a great offer without lowballing.
- Keep an eye out for price reduced properties.
If a home has been on the market for too long, the seller may be more eager to sell. This would be a perfect opportunity to get a great deal on the home. Especially if the home is vacant. Nobody wants to have an empty, unguarded property so any offer might be music to the seller’s ear. Another type is bank owned properties. These properties are usually vacant and the bank has no emotional connection to the home. An experienced real estate agent will be a great asset in making your offer look good.
- Why ask why?
Understanding why the seller needs to sell is the key to making an offer that will satisfy him/her. Did the seller get a job out of town and now, needs to move quickly? Is the seller someone who inherited the home? Is it a second home and the seller is not in a big hurry? It never hurts to ask these questions. Once you find out what is motivating the seller to sell, your chances of getting the home at a lower price will be easier.
- Look for potential
Finding a home that is cosmetically challenged can be a chance to offer far below asking. There are simple and very inexpensive ways to spruce up a home. Although they may be easy and not costly, some sellers may not want to put in the effort and agree to sell for less to avoid making any repairs or improvements. Here is your chance to capitalize on the opportunity.
- Cash speaks louder that credit.
The seller may be frowning as they hear your offer until they hear, “all cash offer”, then they begin to turn that frown, upside down. An all cash offer will usually mean a shorter escrow period and less chance of the deal falling through. An all cash offer is music to a seller’s ears. Music so loud it sometimes drowns out the sound of a low offer.
- Put a higher down payment to avoid paying mortgage insurance.
Speak to your lender and find out how much you would have to put down to avoid mortgage insurance. This will keep your monthly payment lower in case the seller counters with a higher price.
- Be one step ahead.
Finding a good lender is crucial in our home buying experience. An exceptional lender will understand that in all real estate transactions, there will be fires to put out along the way. Your lender will work closely with your real estate agent to make sure that your stress level never gets too high. One way to avoid hurdles is to get all your info to your lender as soon as possible. The more confident you can be, the stronger you will stand behind your offer. Understand that a seller’s biggest concern is going 30 days into escrow and have the deal cancel because the buyer could not obtain the loan. A letter from the lender with pre-approval attached to your offer will help to put the seller at ease and be more inclined to accept your offer.
These are some tips on making a solid offer. Your real estate agent will guide you through the steps. Remember, any offer is better than no offer at all. Happy hunting!