Ace Your Home Offer

You’ve found it—your dream home. You can picture yourself moving in, and you know just what you’ll do with the yard. There’s just one major hurdle left—you have to actually buy it. And that means you have to make an offer that the seller will accept, perhaps over multiple competitors. So what do you do?

Talk to your Mainstreet REALTOR® about the following six options. Each one may or may not fit your particular situation, but some combination of them can help you ace the offer and finally get that new house.

Name the right price

You have one chance to make a first impression with your offer, and that is in the price. Come in too low, and your offer could be rejected outright.

Naturally, it’s in your best interest to figure out the sweet spot—an offer that will win you the home but not cause you to spend more than you have to. Whether that price is below, at or above the asking price depends on the home’s pricing relative to comparable properties, the home’s condition and the local market.

As a local expert, your Mainstreet REALTOR® will know neighborhood trends and can advise you on this most central aspect of your offer.
Have your pre-qualification ready

The closing process is stressful, and it’s in a seller’s best interest to accept an offer that will close with as few hiccups as possible. A pre-qualification shows the seller that you have the income necessary to be approved for a mortgage loan that will let you actually finalize the sale.

In this market, you’ll likely already have a mortgage pre-qualification before you start touring homes. If for any reason you don’t, make sure you complete one before you make an offer.
Be thoughful in what you ask for (if anything)

In a buyer’s market, you may have significant room for negotiation in terms of “extras,” like repairs you want the seller to cover. In a seller’s market, the homeowner may be able to pick and choose among several offers. If two or more of them come in at similar prices, the homeowner will probably pick the one that requires less work and money from them.
Offer flexibility on timing

In the process of making an offer, you will also propose a timeline for closing. This period, in which you, the seller and your respective teams will handle all of the necessary paperwork, usually lasts between 30 and 60 days.

To sweeten your offer, let the seller set the closing timeline. Depending on their situation, the seller may need time to find their new home or to work from their current location through a certain date. In addition to flexibility on closing dates, you may be able to accommodate the seller through a rent-back agreement, which allows the seller to stay in the home from a predetermined length of time after you have officially become the owner.
Include an escalation offer

An escalation offer simply states that you are willing to increase your price if the seller has received a higher offer. (You can set a cap on how high you are willing to go.) For example, an escalation clause allows you to initially offer $350,000, but state that you will pay $5,000 more than any other offer up to $370,000.

There are also some possible downsides to an escalation offer, like limiting your room for negotiation later in the process. A Mainstreet REALTOR® will be your best resource for deciding whether such a clause is the right choice for you.
Increase your down payment (if financially possible)

You may be able to secure a home loan with 8% down, but did you know that increasing the percentage you pay up front can actually make your offer more attractive to a seller?

A higher down payment can make your offer stand out from the competition, and make a seller perceive you as a serious buyer who is unlikely to face any obstacles to closing on time.

Of course, you should only pursue this approach if it is financially viable for you, but if you do, it can also help keep your monthly mortgage more manageable.

For more homebuying advice, check out our homebuyer FAQs.