While this is not a common occurrence, some people do run into this situation: a situation where two or more buyers are so interested in a house that they make higher offers of the price they are willing to pay to try to become the new owner. If you are stuck in this pickle, here are the steps for winning!
REMEMBER: To compete in a bidding war, you will need to be prepared financially for the home purchase. You may also think that offering the most money might be the best way to win the bidding war. This is not an auction; no going once, going twice, SOLD! Sellers are more prompt to picking people who will meet their conditions.
- Have everything financial done! This step should have been completed before you even started looking for a house. We suggest you get a lender and a loan. Listen to what the lender’s requirements and have the preapproved paper in hand. Also consult with them on the maximum you can borrow. Also make sure you completed all required documents. Obtaining written confirmation of preapproval for the mortgage is a must!
- Settlement date: Have the settlement date be convenient for the seller, rather than compromising. You can inform the sellers you will work with their schedule.
- Offer to cover any closing cost. If your finances allow it, offer the seller that you will pay for their out-of-pocket expenses, like their settlement fees. But before making such an offer, first find out the cost of these fees!
- Be personal: When a seller is receiving many offers, they will tend to chose the buyers who seems best fitting for the house. Try writing the sellers a personal letter describing how much you adore their home. Make it emotionally personal.
- Control yourself: While making your offer, do not go higher than you are willing to spend. Also be careful not to bid above the market value of any property. Make an original offer that is not your maximum price. This will leave you room to bid higher if you need to.