This article is part of Global News’ Home School series, an informative resource for Canadians on the housing market. Finding your dream home can be a challenging process, but crafting a convincing bid doesn’t have to be. In this article, we’ll explore how to create a bid that sellers won’t ignore, covering everything from bid price and conditions to non-financial aspects that can sway an offer in your favor.
The bidding process varies from province to province, with some jurisdictions providing templates for offer documents. Once you’ve signed and submitted the document, it becomes a legally binding agreement. Along with specifying the bid price and deposit amount, you’ll also indicate the desired timeline for completing the deal. This is when lenders and lawyers work together to transfer money and exchange keys.
Your bid document should include any conditions you want to attach to the sale, such as a home inspection or financing conditions. It’s advisable to have a mortgage pre-approval before signing any documents, as recent interest rate increases may affect your loan eligibility.
Having conditions in place can protect buyers who are uncertain about their financing or have other uncertainties in the home-buying process. However, sellers generally prefer firm offers with no conditions. Understanding different offer scenarios is crucial. Some sellers set up an offer date, which creates a competitive atmosphere and encourages buyers to improve their offers. In other cases, sellers accept offers anytime, allowing for more negotiation. Pre-emptive offers, or “bully bids,” are another option, although they can be controversial.
Determining the asking price requires looking at previous sale prices and considering appreciation in the area. Looking at comparable properties is a starting point for setting a bid price, and adjustments can be made based on renovations or outdated fixtures. Negotiations can be emotional, so it’s important to establish a ceiling amount to avoid making a financially unwise decision in the heat of the moment.
Crafting a persuasive bid involves more than just numbers. Writing a letter to the seller can make a difference, as it adds a personal touch to your offer. It’s essential to showcase your genuine interest in the home and explain why you would be the ideal buyer.
In conclusion, creating a bid that stands out involves careful consideration of various factors. By understanding the bidding process, setting a realistic bid price, and adding personal touches, you can increase your chances of securing your dream home.
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