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What To Do in a Bidding War

When one desires to purchase real estate, the first step is to find a place they like and want to buy it. Normally, sometimes many people are interested in the same property, causing vigorous competition among potential buyers. This is what we call a bidding war, where each party wants to offer more than the others and ends up paying more than necessary.

While many people will tell you that a bidding war is not worth it due to the potential for getting outbid, there are some steps you can take to make your offer more appealing. This article will provide the 6 best steps to take when involved in a housing bidding war.

Know Your Finances and Budget

Buying a house is one of the biggest financial decisions you will ever make in your life. If you end up paying too much, your mortgage payment might impact other areas of your lifestyle. That’s why before you involve yourself in a bidding war, you should know your financial limits and the maximum budget you can afford to offer. This is for you to avoid putting your finances at risk and overspending than you could manage. If the bidding price is already on top of your budget, it’s better to walk away and look for another home for sale.

Offer Cash Options

Can you provide a cash offer for the house? Generally speaking, a seller can get paid quicker if the buyer offers cash for the home. Thus, if you’re able to offer a full cash deal, your offer will be considered to be the best because the seller doesn’t need to worry about financing.

A cash sale saves the seller time and money because there’s no appraisal or approval process. This means that the buyer can close on the sale much more quickly.

Be Flexible and Friendly

Being in a bidding war can be daunting, and it’s likely to raise your blood pressure. Avoid loss by maintaining a professional attitude when you are in this situation. Stay calm, sort out your priorities before you start bidding. Above all, be friendly and polite at all times to your competitors, as well as the seller.

Arrive Early and Prepared

Research shows that sellers are often more willing to work with buyers who submit offers first. That’s why if you find a house you love, make an offer on it, and don’t wait for the other sharks to circle. Furthermore, arrive in the place early and prepare the necessary paperwork to present before your offers, such as proof of funds, loan pre-approval letter, and other essential documents. Keep in mind that with multiple offers on a property, sellers will want to negotiate with the first bidder.

Choose an Experienced Agent on Your Side

Bidding wars can be stressful and complicated, but with a professional agent guiding your way, you stand to make smarter choices with less wasted time. A good agent can get you to save more money, better terms, and help ease the stress of negotiations. 

Waive Contingencies to Strengthen Your Position

The contingency period is an optional period for both the buyer and seller to read and understand the contract. A buyer can back out of the contract for a variety of reasons during this time. However, if you believe that your offer is perfect, you can help to convince the seller by reducing your timeline to close the deal. Sellers don’t want their homes back on the market.

Conclusion

In the end, it’s all about having a strategy in place, and knowing that your best interests are protected. If you are organized and smart about your plans, you’re sure to come out on top during bidding wars.

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