The days of simply writing an offer with the normal inspection, appraisal, and financing contingencies are behind us. Today, if you want to grab the seller’s attention, you have to take risk and be creative. While all situations are different, here are a few key techniques to consider:

  1. Pass or Fail Inspections - most buyers are not willing to buy a house without a professional looking at it. By all means, keep the right to inspect in your offer, but take out the concern for the seller. Let them know the inspection is a pass or fail - meaning you won’t ask them to fix anything. You will simply accept the property as-is if you don't find anything catastrophic during the inspections. You still retain the protection of being able to walk away if something is seriously wrong, but the idea of no repairs really puts a seller at ease.
  2. Increase your earnest money to show commitment. I would always try to be at least 1% of the sales price. 2% will really speak volumes!
  3. Consider making your earnest money non-refundable. This will show the seller how committed you are to making this deal work (as long as you're comfortable with this level of risk).
  4. Add an escalation clause - stating you will go up $1000 above any other better offer they receive - up to a set cap/limit.
  5. Consider paying any possible appraisal gap - sellers are concerned that a buyer’s appraisal won’t get to the value of the contract since price are rising. By stating you will pay the difference if this happens, it will put the seller at ease. Or maybe you state you will pay any possible appraisal value gap up to a certain amount if you're not comfortable leaving it open ended.

There are many ways to get creative - most of which add more risk to the buyer in return for removing risk from the seller. Only offer what you are comfortable with, but dig deep if you want to rise above the crowd. We have even more methods up our sleeve, and are happy to help you buy in this Uber competitive market - just give us a call.

Posted by Alan Castleman on
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