In the competitive home buying market, it can be exhausting trying to secure a home that suits your needs. Did you know there are many strategies to buy a home in a competitive market? Review Direct Mortgage Loans’ competitive offer checklist to understand the different home buying strategies, you can implement. To speak to one of our experts, contact us here.
1. Assess the Most Important Details
When reviewing a potential home, ask the listing agent about the details that are most important to the seller when selecting an offer. At the end of the day, the seller will choose who will win the house from among the many offers put in. Asking what the seller values most allows you to create an offer that better appeals to the seller. Does the seller need to rent back the house until they settle on their new home? Do they need a quick settlement process? Is a higher down payment ideal? These are just some of the questions to ask the listing agent.
2. Review Neighborhood
After identifying a property that is ideal, review the comps in the neighborhood to determine how competitive the specific property is going to be. Analyze what it took for similar properties to go under contract and consult with your real estate agent.
3. Form Competitive Offer
Before determining how much you should offer, remember to review how much you are comfortable paying each month. Set your home purchase price level beforehand so you know where to draw the line.
Once you are aware of your highest and most competitive offer price, consult with your real estate advisor to discuss a competitive offer. In addition, consider if the seller is allowing an escalation clause. An escalation clause is “a section in a real estate contract that states that a prospective buyer is willing to raise their offer on a home should the seller receive a higher competing offer” (RocketMortgage).
4. Max for EMD
Consider the most amount of money you could contribute to the EMD, Earnest Money Deposit. The Earnest Money Deposit is “made to represent a buyer’s good faith in buying a home. The EMD is often given to your Real Estate Agent when the purchase agreement is signed.” As outlined in the first section, in some cases sellers prefer a higher EMD.
5. Lender Research
When choosing a mortgage lender, make sure to use a reputable local direct lender. Review their online reviews and discuss availability and accessibility. In a competitive market, you will want to ensure your lender communicates with you and your real estate agent in a timely manner. With direct access to funds, a secure mobile app, and timely communication, consider contacting Direct Mortgage Loans for your home financing needs.
6. Be Prepared
In addition, in a competitive market, asking for seller help may be challenging. To be independent of seller help, ensure you are purchasing a home with enough cash to close, meaning you have enough money to complete the transaction of buying a home. Check out Direct Mortgage Loans’ free resources page for a video guide and eBook guide to homebuying success! The best home buying strategy is made from a well-informed decision. Make yourself knowledgeable and comfortable with this information.
Home buying is best attacked strategically and prepared. Check off this list to build your competitive strategy!
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