Be sure you clients understand all their options before making an offer on their dream home…
Escalation Clause: An escalation clause states that the buyer is willing to outbid other offers by a certain amount up to a capped price. Both agents and the seller need to understand the clause and how it works. Be sure other offers are legitimate (bona fide). The increase needs to be realistic especially if there are other important issues for sellers to negotiate, for example the closing date. Don’t forget the appraisal, if it comes in too low that could create other problems.
Hire a Home Inspector: More frequently buyers are hiring a home inspector for the day to attend open houses with them. The benefit is buyers may decide to waive inspection contingencies, making for a stronger offer.
Waiving Mortgage Contingency: By waiving the mortgage contingency a buyer is stating they will forfeit their deposit if they cannot qualify for financing. One way to minimize the risk may be through Fairway’s Fast Lane program, see below.
Fairway’s Fast Lane Program: This gives the buyer an underwriter’s approval upfront, ensuring they are a better candidate and are ready to close, pending the property appraisal. The buyer goes through the underwriting process, and begins house hunting secure that once they find a home, they can go under contract and order the appraisal. Call me for more information.
Cash purchase/refi: Finally, if buyers are able to make a cash purchase, they may have the option of refinancing after the fact to pull their cash back out of the house. Your clients should speak with a lender before paying cash to understand the process and timing of delayed financing.