Page 62 - Sept 2017

Winning the bidding war
When you find your dream home, you might also find that you’re facing competition from other motivated buyers on the same prop- erty. If this is a home that you and your broker are ready to fight for, there are
ly? Would they prefer to sell their home to a family look- ing for a permanent place to settle? Since a home sale is both an emotional transaction as well as a financial one, think of ways that you can appeal to the seller
LISA SANDERS
some key strategies to employ that can give you the edge you need to close the deal, while also protecting your own in-
Real Estate
that go beyond money.
Overall, remember to approach a seller honestly
terests and assets.
Know the market. Spend time with your broker re-
viewing comparable properties, or “comps,” within the same area. The sellers are likely to have done the same, and they will have a sense of the price range they can ex- pect to command. By understanding the current trends for these same types of homes, you will be in a position to offer an enticing bid on the higher end of this range, and you will also know when the price has gone higher than market value would dictate.
Have financing ready when you make the offer. Sellers prefer to put their home under contract when they feel confident that the buyer is serious. When your broker tenders your offer, include documentation that indicates you’ve already been pre-approved for mortgage financ- ing, which shows that you’re ready to move swiftly on the transaction. You can also show the sellers that your in- terest is genuine with a higher initial deposit than might normally be required.
Offer a cash bid. If you have the capital on hand to make your offer in cash, a seller will find it significant- ly more attractive than an offer made through financing. The reason for this is simple — both conventional and FHA-backed loans involve a greater number of steps to complete, which means there are more chances for the financing to run into obstacles. Sellers enjoy greater cer- tainty that the deal will close when the offer has been pre- sented in cash.
Build an escalation clause into the offer. Your broker can prepare a formal offer that includes an escalation clause, which automatically raises your initial offer when the sellers receive a higher competing bid from another party. You’ll establish how much more you’re willing to offer incrementally, as well as provide a ceiling amount. Not only does this reduce the amount of back-and-forth between the bidder and seller during the process, it also shows the sellers your level of enthusiasm for their home.
Consider other needs the sellers may have. Price might not be the only factor — or even the most com- pelling factor — in what drives a seller to accept an offer. Have your broker reach out to the sellers’ broker to learn more about their needs and goals. Are they looking for someone who can close on the home and move in quick-
62 CHICAGO LODGE 7 ■ SEPTEMBER 2017
about your intentions, and be ready to accept de- feat in a bidding war if the price has gone higher than you’re comfortable paying. Winning a competition of of- fers is only one stage of the transaction, and it’s more im- portant that you don’t have buyer’s remorse after you’ve
signed the paperwork and moved in. d
Lisa Sanders has been selling real estate for more than a decade, averaging at least 50 homes per year. Her awards include Chicago Association of Realtors Top 1 Percent Pro- ducer, Five Star Professional Award for exceptional client service and No. 1 Realtor in several Chicago neighborhoods.
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