Bidding on House with Multiple Offers?
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Anonymous
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I'm thinking of putting an offer on a house that will get multiple offers. Wondering what I can do to win, aside from having the highest offer. Any advice?
I've heard that the ability to close quickly can help. Anyone know about that? I'm looking at Wells Fargo and First Savings as lenders. |
Anonymous
If you don't already have your financing lined up, you're already out of the running for the house. |
Anonymous
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We had no selling contingency (we were renting at the time) and we said we were willing to close any time between 30-90 days (depending what worked best for the sellers). We also came with proof of financing.
Other people will suggest waiving inspection, but we weren't comfortable doing that. |
Anonymous
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1) waiving as many contingencies as possible - inspection, financing etc.
2) Large down payment 3) Obv. the ability to escalate up. 4) ask your agent about the seller - they should be able to find out if they want to close quickly or rent back or whatever. |
Anonymous
| We offered $10K more than asking and secured the house. We lost many to builders prior to this one. All about timing and luck. |
Anonymous
Is it not possible for us to finish up the preapproval process in one day and submit a bid tomorrow? Or am I totally off on the timeline? |
Anonymous
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Highest amount of cash in the deal is a big positive. If you've got enough cash to demonstrate that you could put in above 20% you should have your lender write the offer based on the lowest loan amount you could reasonably need. You can then revise the financing (which is only between you and the lender) before you close. E.g., if you've got enough liquid assets to put in 50% of the purchase price, then make your offer with a proposal of 50% downpayment & 50% loan. Then, if you want to switch to standard 80% LTV before you close you are free to do so.
Yet another example of why the real estate industry is shady and full of conflicts and loopholes, but it's allowed, so use this to your advantage if you need to. Also, if you've got enough cash to cover any shortfall, you should waive the appraisal. Assuming you are bidding on a saleable property (which you obviously are given multiple offers), the appraisal only matters if you absolutely can only put down 20% of your purchase offer. If you could put more in, then the appraisal doesn't matter. |
Anonymous
A good seller's agent would likely hold all offers until all the bidders were ready to submit - assuming max one day extra to get preapproval. But that's something your agent needs to verify immediately with the seller's agent. Once they start receiving bids, the clock is ticking and you won't have much more than 24 hours to line up preapproval ... although if you're creditworthy, you can probably get that done by COB today if you start now. |
Anonymous
| Thanks, all! Is it helpful to use the same lender that the seller is using? |
Anonymous
We had to escalate to 15% above asking and waived everything. You do what you have to do. |
Anonymous
I've heard the big banks can take a long time to close. You haven't done your pre-approval yet? You might look into a mortgage broker but you have to consider their fees. We had a friend do ours and he waived his fee. We closed in about 35 days but could've closed a week earlier. |
Anonymous
Probably doesn't matter as long as your lender is reputable. Seller's only concern is that you can get to closing within the agreed upon time. Reality is that many large banks are such pains/bureaucrats on financing & appraisal details that they miss closing deadlines. In this regard, midsized private financing companies can actually be more attractive to seller. In practical terms, it wouldn't hurt to use same lender as seller b/c at least they'll be confident in your choice of a reliable lender. |
Anonymous
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You have to waive everything, have a huge down payment, huge earnest money and documented pre approved financing (if any). If you are lacking any of those, you are out of the running, automatically.
Our buyer bought in cash, technically before the house was listed, though we say he was was the first one that looked at the house. He knew he wanted it before it was on sale, seeing the inside sealed the deal in minutes. Obviously, if it was not beautiful inside, he would have moved on, but we still would have had multiple interested buyers. We gave it to him for asking price. We had already purchased our next house, and decided to cut ties and invest that particular money in more lucrative investments. It worked out for everyone involved. The faster you can do things, the more money freed up (from investments, whatever), the better. |
Anonymous
| OP, please don't bid on this house. Instead, step back and take a couple weeks to familiarize yourself with the real estate process and the market, get yourself a good buyer's agent, and line up your financing ducks. Your future self will thank you for not going into a half-million+ deal completely blind. |
Anonymous
Why would the seller be using a lender? |