Stuck In A Bidding War? Try These Tips To Help You Win

Properties in attractive areas with turnkey appearances will sell high and fast. Buyers often compete for a property in these cases, which leads to offers and counteroffers. If you’re stuck in a bidding war, use these tips to win out in the end.

1. Seek Out Financing Beforehand

Your bidding may fizzle out if you don’t have a lender backing you up. Be sure about your bidding amount by seeking out pre-approval before your home shopping even begins. A lender essentially moves your paperwork partly through the system with a pre-approved amount. As you bid on a property, you know the lender already agrees to fund your investment. The seller understands this fact too, which makes the transfer process nearly guaranteed. Other bidders may not have lender backing yet, and this fact can lead to dropping out of escrow with poor credit and other factors as issues.

2. Use Your Cash Reserves

The funds that you put down on a home out of good faith are also referred to as earnest money. It tells the seller that you’re serious about a property purchase. To win a bidding war on homes for sale in the Twin Cities, try adding more money to this earnest amount. These upfront funds might sway a seller’s mindset in your favor.

Another strategy is simply increasing the bid on the home. You may not know what the other buyers are offering, but adding a few extra thousand dollars to the asking price might make the difference.

3. Bid Within Your Budget

Although you may want to appease the seller on every level, you are the one who must live with the final balance and monthly mortgage. As you consider offers and counteroffers, remember your budget. This amount is a mixture of the bank’s approved amount and your financial position. Don’t overbid on the property if you cannot handle the monthly payment. It will eventually wear on your well-being. If someone else outbids you, another property may be better for your situation.

4. Toss in Some Incentives

There might be certain contingencies requested of both the buyers and the sellers. Time constraints, funding issues, and other concerns can make a bidding war last for more weeks than necessary. If possible, offer incentives like moving in as soon as possible or even giving the seller extra time to move out. Making the transition easy on the seller can improve your odds of winning the bid. It may not even be the highest bid either.

If the seller wants to leave the laundry system in the garage, for example, approve this feature so that you look better than other bidders. They might have contingencies that are relatively frivolous as opposed to your accommodating style.

Remind yourself that this home isn’t the last one in the world. If you end up losing a bidding war, a better property might present itself in the future. Use these tips, but don’t overlook the bigger picture. Your dream home must fit your needs and budget at the end of the day.