by Kate Sutton
If you are a buyer in LA being beaten out by others every time, congratulations, you’ve been in “multiples.” It can be so disheartening to find your dream home, and at the right price, only to discover you have been beaten out by a cash buyer or at a ridiculous amount over the asking price.
Here are some tips to strengthen your offer:
- Make sure you are pre-APPROVED, not pre-QUALIFIED by a lender. In this market, a pre-qualification letter can be put at the bottom of the pile.
- If you are searching for properties up to your price limit, I suggest starting to look at a lower price point as this leaves you some room to move if you find yourself competing against other buyers.
- Always have your agent ask if the seller is going to counter all offers, that way you can make an offer knowing that you should have a second opportunity to make another much stronger offer.
- As well as having good rates, your chosen lender needs to be timely with their appraisal and final loan approval contingencies and reflect this in the offer. Even with the government required three days between the buyer receiving and signing loan documents, the bank should still be able to close in 30 days, 35 max.
- Be careful of the “escalation clause.” An agent may suggest adding an escalation clause to your counter offer stating you will pay a certain amount over the highest bid. This can be attractive to some sellers for obvious reasons, but at the same time, other sellers can see it as a form of cheating.
- A personal letter to the seller is a great tool to add to any offer. Selling a house can be very emotional, and a lot of homeowners are looking to sell their home to someone who will love and take good care of it.
It’s a jungle out there and having a good, experienced agent is the first important step in buying a home.
Kate Sutton is a local real estate agent with Compass. If you are thinking of buying or selling, contact Kate. Kate.Sutton@Compass.com or 310.500.7793