You've searched high and low and finally found your dream home at just the right price. Then, your agent tells you there are multiple offers on the same home and you've found yourself in a situation all buyers dread--a bidding war. We have six tips for how to win a bidding war. May the odds ever be in your favor!
1. Change your contingencies
Buyers can back out of a contract during the contingency period of a home sale. This time is typically 17 days. By compressing the contingency timeline from 17 days to something shorter, like five days, the sellers may be more willing to choose your offer if they want to close the deal quickly.
Another idea for using contingencies in your favor to win a bidding war is to reduce the amount of contingencies you have. Sellers often don't want to put their home back on the market if a sale fell through due to contingencies. Resisting making a lot of contingencies for home upgrades or your own home selling before closing on the new home can make sellers averse to your offer.
2. Make an all-cash offer
If you can afford it, an all-cash offer can be extremely appealing to sellers.
3. Make the down payment large
If an all-cash offer isn't in the cards for you, try making your downpayment on the home as large as possible. This shows the sellers you are invested in buying the property and have the funds to afford it.
4. Have a pre-approval letter
Having a pre-approval letter ready and on-hand shows the sellers that an underwriter has reviewed your applicable financial information and a lender is ready to offer you a mortgage up to a specific amount based on that information.
5. Write a letter to the sellers
Writing a personal letter to the sellers and telling them how you genuinely like their home and hope to live there can be a sincere way to tip the bidding scales in your favor. If there are multiple offers on the property that are around the same price, a sincere letter can really shine amongst the other offers.
6. Offer more than the asking price
While it's not fun to paymore than the asking price, sometimes it's worth it for the right home. Offering even slightly above the asking price can really make a difference to sellers.
Buyers can back out of a contract during the contingency period of a home sale. This time is typically 17 days. By compressing the contingency timeline from 17 days to something shorter, like five days, the sellers may be more willing to choose your offer if they want to close the deal quickly.
Another idea for using contingencies in your favor to win a bidding war is to reduce the amount of contingencies you have. Sellers often don't want to put their home back on the market if a sale fell through due to contingencies. Resisting making a lot of contingencies for home upgrades or your own home selling before closing on the new home can make sellers averse to your offer.
2. Make an all-cash offer
If you can afford it, an all-cash offer can be extremely appealing to sellers.
3. Make the down payment large
If an all-cash offer isn't in the cards for you, try making your downpayment on the home as large as possible. This shows the sellers you are invested in buying the property and have the funds to afford it.
4. Have a pre-approval letter
Having a pre-approval letter ready and on-hand shows the sellers that an underwriter has reviewed your applicable financial information and a lender is ready to offer you a mortgage up to a specific amount based on that information.
5. Write a letter to the sellers
Writing a personal letter to the sellers and telling them how you genuinely like their home and hope to live there can be a sincere way to tip the bidding scales in your favor. If there are multiple offers on the property that are around the same price, a sincere letter can really shine amongst the other offers.
6. Offer more than the asking price
While it's not fun to paymore than the asking price, sometimes it's worth it for the right home. Offering even slightly above the asking price can really make a difference to sellers.
