Is it even possible to win a bidding war right now? Absolutely! First, you need to find yourself a great local lender. Once you’ve done that, you should be able to find a great local title company, and local inspector, that way you will have a whole team there to help you with anything you need from beginning to end.
How to get a home in the crazy market?
Well, there’s multiple ways you can do this. You could do an escalation clause, or even an appraisal gap clause, offer a higher escrow deposit, or a shorter inspection period.
The key is to listen to the thoughts and advice of that professional real estate agent especially when it’s someone who is gifted at winning these bids.
What is an escalation clause and how does it work?
An escalation clause is an addendum to a real estate contract that states how much the buyer is willing to pay over the highest offer and their maximum spending limit. An escalation clause gives you the opportunity to go higher than someone else’s offer. So, with the escalation, the only time that clause goes into effect is when there are competing offers.
Paying cash over the appraised value?
Is it possible to pay cash over the appraised value? Yes! No matter what the appraisal comes in at, if you are willing to put cash on top of that, you can do that.
But always remember to go over it with your lender first. If the lender states that you have the available funds to put down towards the home over the appraised value, then you can absolutely do that.
Why would you want to pay more than the appraised value?
If you have multiple offers on a house, and this is something you’ve been wanting and have the availability to pay over the appraised value, then that is one way to get the house. You, then, must ask yourself if the home is worth it to you regardless of the appraised value. What is the value to you? Is this a long-term investment for you? Does it make sense as a personal investment or is this a business investment? If this is a personal home, the value may not be financial so paying over the appraisal might make sense for your situation. Only you can answer that question.
So, it is possible to win a bidding war?
The answer is yes. With the right local lender and a great local title company, they will make this process easy going for you.