★7 Tips To Help Get Your Purchase Offer Accepted★
In today’s competitive market where multiple offers are the norm, it is very important that your offer stands out from the crowd so it is given every chance of getting accepted!
Here are 6 tips that you can use that will strengthen your offer and ensure your Purchase Offer stands out from the crowd:
1. Submit a Strong Cover Letter!
Submit a strong cover letter with the Offer explaining a quick synopsis of your situation and why you are the best candidate to purchase this home. It is also a good idea to include a personal letter also. If you can tug at the heart strings of the seller, then they may be more apt to choose your offer over others!
★It is also important to address upfront any red flags in your profile, so the seller is not put off by anything★
2. Make sure the pre-approval letter advises what type of financing you will be getting.
Provide a pre-approval letter that explains what type of financing you will be getting and how much of a down payment you are using. For example, if you're qualified for conventional financing and putting down 20%, make sure to write this into the pre-approval letter, as this will usually place ahead of a FHA buyer that has a 3.5% down payment or a VA purchase offer that has no down payment.
3. Provide a DU Underwriting approval with the offer.
Make sure your offer is accompanied by a DU automated underwriting approval. A DU (Desktop Underwriter) underwriting approval is when your loan application has been run through Fannie Mae’s, FHA’s or VA’s automated DU underwriting system and was issued with an underwriting approval.
A DU underwriting approval displays the most important information needed on your profile and will give the seller a good idea of the strength of your offer. For example, a DU approval will lists the credit scores, debt to income ratios, assets, down payment and the type of loan program you are approved for.
4. Provide proof of down payment funds.
Always provide proof of funds and where the down payment funds are coming from. Make sure to send over recent bank statements or statements from any account you are using for the down payment. Make sure there are enough funds in the statements you are providing to match the down payment listed on the offer.
Or if you're are going with FHA and are getting a gift from a family member, make sure there is a gift letter provided with the offer. Once again, make sure there is always enough funds to support the offer.
5. Make sure everything on your offer is current.
It is not uncommon these days for a buyer to be submitting offers for up to 3-4 months before they find a home, so sometimes many of the documentation in a buyers file is outdated, and copies of the pre-approval letter, the DU underwriting approval or proof of funds have a date that is a few months old.
Therefore make sure all the dates on your cover letter, approval letter, DU approval and all funds provided are current and within the last 30 days.
6. Don’t ask the seller for credits to cover closing costs.
A Purchase Offer asking for seller credits to pay for your closing costs will usually place behind a buyers offer that does NOT ask for any seller credits! Most people assume because they don't have funds for closing costs, they will just ask the seller to cover them. This does happen, but here is a better option.....
"To make your offer more competitive, you can pay ALL closing costs with a lender credit!"
How does this work? It’s easy, instead of taking let’s say a 3.25% 30 year fixed rate on a FHA loan, you can take a slightly higher rate of 3.5% instead, and with this higher rate there is now a lender credit of roughly 2.5% available that can be used to pay ALL your closing costs.
Not only is this a good negotiating tactic, but it will help you purchase a home if you don't have the funds to pay for your own closing costs! I present this option to all our buyers so they know this option is available to them!
7. Faster closing to entice the seller to accept.
Being able to close a transaction fast is one way to entice the seller to accept your offer in this competitive market!
For example, if a seller is reviewing 3 offers, and there is a 17 day offer, a 30 day and 45 day offer, more than likely the seller will take the fastest closing. Therefore being able to close faster is a strategy that you can use to help get you into contract!
Rodeo's Affiliate, L.A. Mortgage can usually close a Conventional Purchase Transaction in 17 days (FHA and VA in 21 days)
They are an outstanding team set up and dedicated to closing transactions fast!
I hope you found these tips useful. I believe that full transparency upfront is the key to getting an offer accepted these days, because usually the “Path of Least Resistance” is what Sellers look for when reviewing offers!
Have A Great Weekend Everyone!
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