In this market, it’s very common to be competing with multiple offers. Here are some tips to stand out from the crowd and increase your chances of winning the seller’s signature:
- Fluff Letter. What agents call a “fluff letter” is a short letter to the seller about the buyer. Odd as it sounds, multiple offers is like a hostage situation: if you can humanize the victim (in this case, the buyer) you stand a better chance at getting out alive (i.e., getting your offer accepted). Sellers have emotions, too, if they have several offers that are very similar, but yours has a story behind it, they may be inclined to try to work with you. It’s easier for sellers to reject offers from anonymous buyers they know nothing about!
- Financing Contingencies. There are lots of cash buyers in this market. If your offer has a financing contingency, try to make it as attractive as possible to the seller so that you stay in the game. Make your deadlines as tight as possible, and put as much down as you can. Remember, if you put 30% down in your offer, you can still get a 20% down loan, you just need to have the extra money available from somewhere in case your 20% loan is rejected.
- Inspection. The other major concession to the seller is removing the inspection contingency. It’s never easy to advise a client to do so, but it can mean the difference between an accepted or rejected offer. If it’s a large association where the major systems are common and the age and condition is relatively well-known, in some cases I might advise removing the inspection contingency.
- Deposits. One thing you can do that doesn’t technically cost you a penny is to increase your Purchase & Sale deposit from the typical 5% to a more substantial 10%. This will give the seller more confidence in your ability to follow through. The danger, of course, is that if the transaction goes horribly awry, you have alot more money sitting in the listing brokerage’s escrow account and at risk. However, when competing against offers with better terms, like no financing or no inspection, this is one way to win out.