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Seven Golden Rules For A Successful Bid On A House

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By : Antonio Cardenas    99 or more times read
Many home buyers have decided to jump off the fence and buy their very first house; perhaps it was the drop on interest rates to historical lows, or maybe the number of perceived bargains offered by the banks plus a high inventory of homes for sale, or perhaps the $8,000 offered as a tax incentive from the government. When all these factors are put together, you will think it's heaven and you will have the time of your life choosing the best possible home at the best possible price with an incredible low interest rate for the next 30 years... or is it?

This is not the true picture of what we are seeing today. It appears that the REO's or bank owned properties that flooded the market before and kept the inventory high due to their inability to dispose of those properties, have finally figure out how to sell them... by under pricing them! This strategy has been paying off for them very nicely. Buyers trying to outbid each other will push the price to the highest point the market can bear.

An underpriced REO home goes on the market and attracts a good number of home buyers who think that they finally found their dream home or ideal investment. They quickly realize that they are not the only ones out looking at homes for sale. Here in the east shores of the San Francisco bay, in Alameda County, we are seen 40-50 and even 60 offers presented within days of a house being put up for sale.

How can a home buyer compete and win this bidding war? By understanding how offers are viewed by the seller and being prepared to meet those requirements as much as possible. If you can pay all cash, there will be no financing contingencies or appraisals to wait for, and the escrow can close within days. However for most people that is not possible, but the following steps will help you strengthen your position and get your offer accepted:

  1. Do a complete loan application and bring every piece of paper requested by the lender

  2. Have the bank issue a complete pre-approval letter, signed by a real person

  3. Offer to pay more than the asking price if you can

  4. Put a large down payment if possible, this will help when your offer is compared to others

  5. Be prepared to take the house on an "as-is" condition and spell that out in the contract

  6. Reduce the inspection contingency from 17 to about 5-7 days only

  7. Reduce the close of escrow to less than 30 days if possible

Realize that the sellers don't care who buys their house, all they look for is to get the maximum amount of money in the quickest amount of time and with the least amount of inconvenience. They don't want to do any work, or wait too long to close the escrow or pay for anything extra.

Now that you finally decided to jump off the fence and get into the housing market and become a homeowner, you need to give this idea some time and dedication, because as the $8,000 tax credit window closes on November 30 2009, there will be far more competition and you will need all the help you can get. Work closely with your chosen Realtor, don't go at it alone and be prepared to go see a house within minutes and possibly write an offer on the spot.

This market offers you a great opportunity to make the purchase of a lifetime... but others are also aware of these positive conditions and you will get to meet them when they compete with you... just when YOU think YOU found YOUR dream home. Happy House Hunting!
Antonio & Alexia Cardenas, "The Realtors In Motion" Professional Realtors, Amateur Ballroom Dance competitors. Serving the Alameda & Contra Costa counties in the East Shores of the San Francisco Bay. Specially the cities of San Leandro, San Lorenzo, Hayward, Castro Valley and Oakland. Visit us at: Call us, we'll come and TANGO with you.

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