Logically, the highest offer will always be accepted by the vendors of a property. But, new research shows that isn’t always the case.
So, if you are planning to move home, or buy your first, how can you put yourself in the best position possible to have your offer accepted, even if it is lower than others are making?
1. Get your mortgage approved
Showing that you have a mortgage in place, for the required amount, will convince vendors that you can afford to buy the property and you are well prepared.
A Decision in Principle (DIP) is effectively a mortgage application made without a specific property in mind. The lender will run a credit check, and credit score, and tell you the maximum they will lend. Following a successful DIP you will receive written confirmation that you have been accepted. You can then show to the vendor, or their estate agent, to confirm you are in a position to proceed, should they accept your offer.
2. If you’re a first-time buyer, make sure the vendors know it
First-time buyers and Buy to Let (BTL) investors often compete for the same property.
BTL investors may be cash buyers, which puts them in a very strong position. Yet many vendors would rather sell to a first-time buyer than an investor.
At the viewing make sure the vendor knows you are a first-time buyer; it may be the thing that sways their decision in your favour.
3. Break the chain
The research, from ClearScore, a credit checking service, shows that 90% of vendors are more likely to accept a lower offer from buyers in a position to proceed, rather than a higher offer from a buyer in a worse position.
That means, as we said above, getting your mortgage approved before you make an offer. But also, considering ways you can break the chain.
A chain free buyer is extremely attractive and there are a number of ways to do this, including completing on the sale of your home, and living temporarily in rented accommodation or with friends or relatives. Another option may be to arrange your finances so that you don’t have to sell your property, to proceed with the completion of your new home. That’s often easier said than done; but can be accomplished with some innovative thinking and, dare we say it, good advice.
4. Build relationships
A good relationship with an estate agent, and more importantly, the vendor themselves, will go a long way to getting an offer accepted. Especially if you are a first-time buyer.
It might not work, but winning the vendor’s hearts and minds could be the difference between an accepted and rejected offer.
5. Do everything you can to get accepted for a mortgage
There are several things you can do to improve your chances of getting a mortgage.
All mortgage lenders will carry out a credit check, most will conduct a credit score. There are steps you can take to ensure you pass both, which in turn, will get your DIP application accepted and helps convince your vendor that you can proceed with the purchase.
We explained the 12 things you can do to help get your mortgage application accepted in a recent article, which you can read by clicking here.
6. Agree the solicitor you will use
You will need a solicitor to help you buy a house. Having one lined up, along with your accepted DIP application, shows you are organised and will instil a feeling of confidence in the vendor.
7. Keep things moving
Once you’ve had your offer accepted, it’s vital you keep the process moving along as swiftly as you can. That usually starts with ensuring your mortgage lender surveys the property without delay and you quickly formally instruct your solicitor.
Your mortgage application
Unless you are a cash buyer, you will need a mortgage. As we’ve said, that starts by submitting a successful DIP application with the lender you are likely to use.
That’s where we come in.
Our job is to identify the right mortgage option and lender for your requirements and then submit the DIP application. The first step is to get in touch with us by calling 0207 808 4120 or completing our online contact form, which you can find my clicking here.