Are you a medical professional frustrated by the competition in the housing market? Do you know how to make your offer stand out from the competition?
A recent poll by The Physician Philosopher asked a group of doctors what contributed the most to their weekly stress. Their answer? Balancing being a good partner/spouse, parent, and physician.
You do important work, and the chaos of this year has kicked that into overdrive. We understand your attention and energy are in high-demand – both at work and at home. We don’t think you should have to sacrifice valuable time with your patients and your family just to balance the stress of a complicated (and possibly derailed or even declined) mortgage application.
We often see medical professionals go down the mortgage path only to be declined by a lender at the last minute. An unfortunate amount of our business comes to us after these buyers have already experienced a failed transaction. Our goal is to completely eliminate the risk of that happening to you.
Competition Is Increasing. Are You Prepared?
In August 2020, 55% of home sales resulted in a bidding war – meaning there were multiple offers on the property. Additionally, 69% of homes sold in August 2020 were on the market for less than one month!
What does this mean? It means if you want to compete with the rest of the buyers out there that are looking for good homes in the best neighborhoods, you have to be better prepared and able to move faster than the competition. That is the recipe for success in getting your offer accepted in today’s market.
There is a lot that goes into building an offer that will stand out above the competition. We’ve come out with a five step process that will both eliminate the chance that you’re going to get declined by an underwriter and help you get your offer accepted at the best price possible.
Step 1: Get Pre-Approved
This is #1 on this list because it is essential to getting your offer accepted. The home buying process is already complicated and stressful, and that stress is multiplied tenfold if your offer does get accepted because you were not able to qualify for the full amount needed.
Following this step means you don’t just fill out some information on your phone and get a letter in a couple of minutes. We are talking about a full credit and income underwriting approval.
This means your loan is not going to be submitted to an underwriter a week before you’re supposed to close on your home. It means that you’re going to meet the underwriter upfront, and you’re going to go through a full pre-underwriting process.
What’s more, having your financing approved by a mortgage underwriter before you make an offer means you can potentially remove the financing contingency (ask your Realtor about this one). This will go a long way in making your offer stand out, as the seller won’t have to worry about your loan falling through.
Step 2: Offer to Pay More
You may have to pay a little bit more in this market in order to get your offer accepted. That’s just kind of the reality that we’re in today. This higher price can come in the form of a higher purchase price or a larger portion of the closing costs.
Step 3: Learn the Seller’s Motivation
As the buyer, you need to understand more about the seller than any of the competition.
Ask your Realtor to speak with the listing agent and find out what is most important to the seller. Are they looking for the highest offer and will wait to sell until the price is right? Are they starting a new job in another state and need to be out by a certain date? Is the purchase of their new home contingent on the sale of this one? Maybe they just want to find someone who they know will take care of the home they have made so many memories in. Understanding the seller’s motivation will help you know how to present the most attractive offer.
Step 4: Offer a Faster Closing
This step is key, and number four and number one are tied together. Once you’ve gone through the pre-underwriting process, you’re already approved. All you have to worry about now are the legal disclosures, the appraisal, the title work, and update anything that has been outdated. This may seem like a lot, but it’s a much faster track from here to closing which helps you get your offer accepted.
Step 5: Include a Personal Letter
Imagine this: You are selling your home and have been sifting through dozens of offers. You’ve narrowed it down to the top two: same amount, same deadlines, same earnest money. Everything is identical…except one of them has a letter. It has a photo of a young family and explains how perfect your home is for them because it is close to the parents’ workplaces and the kids love the backyard.
The other offer has no letter. Which one would you choose to make new memories in your home? This could (and often does) make the difference in your offer being accepted over someone else’s.
The Bottom Line
We know financing a home can be scary, confusing, and hard at times. However, if you employ these tactics you will see huge wins in multiple-offer scenarios. There is no need for you to be intimidated by the competition in the housing market!
If you would like to get pre-approved for a home loan or have questions about how the process works, fill out the free consultation form below to speak with one of our mortgage advisors. We look forward to helping you WIN!