As surprising as it might seem, I have seen many offers with financing beat all-cash offers. I have even seen LOWER offers with financing beat all-cash offers. How? In a word, it’s all about preparation, and a well prepared buyer can win the day. Add details like having the buyer’s mortgage advisor reach out to the listing agent to answer key questions from our Questions that a Listing Agent Should Ask a Pre-approved Buyer’s Lending Professionaland having the buyer(s) write a personal letter about them to the seller, and you have a winning strategy for success in today’s market. OK, to the rules:
- Be transparent. The underwriting process triple checks every aspect of the transaction. Best not to hold anything back, as it will likely be discovered if there are any material changes to the transaction or loan application, which of course can cause potentially serious issues.
- Be expedient and thorough.It is important that your buyer provide complete documentation to their Mortgage Advisor as quickly as possible throughout the loan process. For instance, if all pages of the bank statement are requested, it really means all pages, even the reconciliation page or the “This page intentionally left blank” page of the statement.
- Keep detailed financial records. If your buyer needs to transfer funds from one account to another or to sell stock for a down payment, make sure that they are keeping a detailed paper trail of all transactions, deposits and liquidations, as this is an important underwriting requirement.
- Stay current on all obligations. Credit is pulled multiple times during the process and any late payments can severely impact credit scores and qualifications.
- Avoid new obligations and other credit inquiries. For example, responding to credit card offers or allowing a car salesperson to run credit will impact credit scores. For more information on credit scores, visit www.myfico.com.
- Stay employed. Employment is checked every two weeks up to the date of funding the loan.
- Remain Available. Best to remain local, as leaving town inevitably causes delays.
As the agent, lean on the mortgage advisor to write a strong, customized pre-approval letter backed by a vetted underwriting decision; this will demonstrate to the seller that your buyer can be taken seriously and is able to close the deal.
Finding a new home can be a long and overwhelming process, especially with today’s inventory. The last thing you want is to find a home that your buyer has fallen in love with, only to lose it due to a lack of a client’s proper preparation. The above tips will help your financed buyer stay on track with their loan process and stand out among other buyers in a multiple-offer situation, even all-cash buyers. If approached correctly and if you present the seller with information to prove that you have a serious, well-qualified buyer, a financed deal is no riskier than an all-cash deal.