Making an SLC Home Offer That Impresses a Seller

There are a few parts of the homebuying process that are very important for buyers, and one of these is making a quality offer if you’ve found a home you love. Many are aware that the home market today is still very much a “seller’s market” with lots of demand, and this only increases the need for a great offer that will not only show the seller you’re serious, but also potentially help you stand out from other buyers.

At Altius Mortgage and our partners with Mortgage Ogden, we’re happy to help with numerous parts of your homebuying process in Salt Lake City or any other part of Utah, including themes like making offers to sellers and providing you with proof of purchasing power for these offers. Our services are often especially beneficial to those entering the home market for the first time, as these people may not have any experience with making offers and could use some advice on how to do so. Here are several tips we often provide to clients on how to make an offer that will impress the seller and give you a great chance at being the winning bid.

Show Proof of Purchasing Power

First and foremost, no seller is going to take your offer seriously if you don’t have the ability to actually complete the purchase. This is why it’s important to provide evidence of your purchasing power upfront in your offer letter or package.

The most common form of such proof is the use of a pre-approval letter, which is a document from your lender that states you have already been approved for a mortgage up to a certain amount. Other common forms of proof include recent bank statements and/or pay stubs that show you have a healthy income and can afford the monthly payments on the new home.

If you’re not quite there yet in terms of getting pre-approved, don’t worry – you can still make a solid offer by providing a letter of intent instead. This is a document that states your intention to get pre-approved and buy the home if your offer is accepted.

Earnest Deposit

There are certain types of deposits that can be made during a home offer, and one of these is called an earnest deposit. This is a cash deposit that you submit to the seller alongside your offer, and it shows that you’re serious about buying the home. It’s meant as a “good faith” deposit of sorts, and if the deal does not end up going through, this money will simply go to the seller.

Ideally, your earnest deposit should be large enough to show the seller that you’re serious but not so large that it will bankrupt you if the offer is rejected. A good rule of thumb is to make an earnest deposit that’s about 1-2% of the purchase price.

In addition to impressing the seller, an earnest deposit can also help your offer stand out from others by proving that you’re willing and able to put your money where your mouth is.

Quick Inspections and Other Deadlines

While this won’t be the case for every seller necessarily, many are looking for a quick process that allows them to move on with their lives. This is why it’s important to come in with a offer that has some quick inspections and deadlines associated with it.

For example, you could propose a 72-hour inspection period in which the seller can’t accept any other offers and you will have the chance to fully inspect the property. You could also propose a deadline for the seller to accept or reject your offer, again putting them in a position where they can’t wait too long.

All of these measures show the seller that you’re serious about buying their home and that you’re willing to move quickly if they are as well.

Consider Contingencies

Home offers will also typically come with certain contingencies, which are terms that must be met in order for the sale to go through.

One of the most common contingencies is the mortgage contingency, which states that you’re only able to buy the home if you can get approved for a mortgage at a certain interest rate. This contingency protects you as the buyer in case your financing falls through, and it’s important to include it in your offer.

Other common contingencies include the home inspection contingency, which gives you the chance to have a professional inspect the property before you buy it, and the appraisal contingency, which states that you will only buy the home if it appraises for a certain amount.

In some cases, you may consider waiving certain contingencies in order to make your offer more attractive to the seller. However, you should only do this if you’re absolutely confident that you can still meet the terms of the contingency if it’s waived.

Don’t “Start Low” On Offers

This is not a bartering or haggling process, and you should never start your offer low in the hopes of getting the seller to come up with a better number.

In fact, this will likely have the opposite effect and make the seller less likely to negotiate at all. Instead, make a strong offer that is backed up by evidence such as pre-approval from your lender and a large earnest deposit.

The bottom line is that you want to make an offer that shows the seller that you’re serious, capable, and ready to buy their home right now. By following the tips above, you can put yourself in a much better position to do just that.

For more on how to make a great home offer that will impress your seller, or to learn about any of our loan officer services, mortgage rates or other solutions in SLC and nearby areas, speak to the staff at Altius Mortgage today.