The demand for housing in South Carolina is very high, but there aren’t too many homes available to buy. This is the reason for today’s incredibly competitive housing market. According to realtor.com, some homes are getting 20 to 30 offers on them, and they are selling for $50,000 to $100,000 over the asking price. It is very easy to get overwhelmed in a situation like this, so having a plan and getting advice from a real estate professional will give you the best chance to win a bidding war.
Before you start looking at homes throughout South Carolina, there are some steps you can take to make the whole process easier and make your offer more competitive. First, you will want to have your financing in order before you begin this process. It would be best to have your earnest money deposit ready, know how much you can pay towards the down payment, and review your credit profile. Next, you should try to know what you are looking for in a home and a neighborhood. Lastly, it would be best to have a team of experienced real estate professionals helping you through the whole process. This team of people should include a mortgage loan officer, a realtor, and a real estate attorney or closing agent, if applicable.
In the current market, you need to know how much you want to pay and how much you can afford to pay because these can be very different when you find yourself in a bidding war. If you offer your highest bid and find out that you still aren’t competitive enough, then we have some tips for you!
How can you make your offer more competitive?
Get Pre-approved – A pre-approval is one of the essential steps to getting approved for a mortgage. At MEP, our pre-approvals are fully underwritten, and they show that you are a serious buyer and an approved buyer. A pre-approval also speeds up the loan process, which can be the deciding factor for the seller when accepting an offer. You will already have most of the upfront work done with a pre-approval, and the rest of the process move quickly after that!
Waive Contingencies – Contingency clauses are important and allow buyers to back out of a contract if certain conditions are unmet. One of the most common contingencies is the mortgage contingency which lets you out of a contract to purchase a home if your financing doesn’t work out. Of course, you only want to do this if you are confident that you will be approved for a mortgage.
Escalation Clause – An escalation clause allows buyers to increase their initial bid by a certain amount each time another higher bid comes in. It is a good idea to put a cap on an escalation clause.
Write a love letter to the seller – Writing a love letter was unique, but it became more common and may have lost its charm. Basically, buyers will write a letter to the seller telling them why they are the right buyer for their home. According to Realtor.com, many buyers are still excited to write them.
MEP’s Property Inspection Waiver Program -The property you are looking at in the South Carolina area may be eligible for an inspection waiver. Our new tool allows LO’s to get a PIW before you make your offer which makes it much stronger, and you know how high you can go up in the bidding war without having to worry whether the house will appraise at the right price and if you will still qualify for the loan. Mortgage Equity Partners loan officers can walk you through this process but contact us first to have the information you need in advance of making an offer.
If, at first, you don’t succeed, keep on trying. If another buyer was chosen over you, that doesn’t mean some part of their transaction might not fall through, and if you have a competitive enough offer, you might end up being pleasantly surprised that you are next on the seller’s list!