Negotiate Your Home Offer

The search is over! After scouring multiple online listings and spending countless Sunday mornings at open houses, you've found the perfect home. There's one important step you need to take before you can make it yours – negotiating the winning offer.

Negotiating can be a stressful and nerve-wracking process, especially when there may be multiple buyers looking to make your dream home theirs. But, there are some steps you can take to make your offer stand out:

• Learn about the seller. In home negotiations, knowledge is power. Knowing about the seller, such as the reason they are selling their home can help you tailor your offer to meet their needs and gain a powerful advantage.
• Get pre-approved. Sellers want to know a lot about you, too, most notably that you can afford their home. Having a pre-approval from a reputable lender will show them that you are a serious buyer in a good financial position. Before you submit your offer, get pre-approved with a reputable lender and include the pre-approval with your offer.
• Be flexible. There are other areas of negotiation that go beyond price, including timing. A seller may, for example, need to close earlier in order to get the funds they need to buy another home. In that case, moving up the closing date could get you a negotiating edge.
• Use an experienced real estate professional. A good real estate agent can help you determine what the home is worth and write the best offer to help you beat out the competition.
• Put your best offer first. Before you make an offer, determine the maximum amount you are willing to spend. If you believe the house is worth it or if there will be multiple offers, make that your best offer. One thing you never want to do is exceed your budget to win the home. A mortgage that's too high will make you fall out of love with the home quickly.
• Avoid contingencies. Simple offers are often winning offers. One way to simplify yours is to avoid contingencies, such as making the purchase of the home contingent upon the sale of a property you own. Also, buyers will sometimes waive standard contingencies, such as the appraisal or the inspection. If you do waive an inspection, understand the risks involved. You could also waive the financing contingency. If you decide to go that route, be certain that you will qualify for the loan, since failure to get financing could result in losing your deposit.
• Raise your down payment. Another way to gain an advantage is to put more money down on the home. This will reduce the amount of the mortgage you will need, which can help you if the appraisal comes in lower than expected.
• Write a personal note. Though finances are usually the deciding factor in home negotiations, it never hurts to make a personal appeal, particularly if all offers are equal. Include a personal note with your offer that tells the sellers about you and what their home means to you. Again, knowing about the seller can give you an advantage.