There are few things more exciting than finally finding a home that meets your needs (and hopefully some of your wants), especially if you have been searching a while. Don’t celebrate just yet! Unless you are offering list price you may need to put forth a little effort to help the home seller see the value of your lower bid.
1. Write a Love Letter
Home sellers have a hard time resisting a buyer who truly loves the property for very special reasons. Tell them why you love the house and neighborhood. Your reasons may very well be the same, or at least similar to the reasons they fell in love with the property years ago.
2. Keep Contingencies Reasonable
Sellers are always going to favor no contingencies, but you need to protect yourself. You can skip the list of conditions you would like to see done, but still request a home inspection. Vow to have it done in 7 to 10 days, so the seller does not feel as though you are keeping the house tied up. Offset the inconvenience with a strong earnest money deposit.
3. Don’t Insult Them
If you want a lower price you are probably not going to get it with a lowball offer. That’s just insulting and it will give them the impression that dealing with you will likely be a long drawn out back-and-forth process.
4. Have 20% Down
If you are bidding a lower price and you still need to try to get approved with only a small amount down, a seller may not even be interested in entertaining your offer, without 20 percent down.
5. Get Pre-approved
Instead of just getting pre-qualified, show the home seller how serious you are with your pre-approval letter from the lender. That golden ticket holds a lot of weight when it comes to negotiating.
6. Cash is Always King
A cash buyer is always going to be more appealing than a buyer securing financing. If you have the means to make this a cash purchase, you will likely get an even better deal.
7. Match Their Closing Date
Selling a home is very stressful, especially if the seller still needs to find or close on their own home, or if they are relocating out of the area, but aren’t leaving right away. If you can help make their move smooth by letting them live in the house 30 days and then offering to rent for a specified time after then the deal will be significantly sweetened for them.
A lower offer can have a tremendous amount of value. If you want the house for a great deal, you will need to help the home seller see the value you are bringing to the table.