Don’t Go to Open Houses…

…unless you are prepared to make an offer.

But I just want to get an idea of what’s on the market.Open Houses in Salem MA

It’s great that you want to see what’s on the market, but you can actually do that from the comfort of your own home (or apartment) on any of the real estate search websites. What happens if you see a house that you really love? Are you fully prepared to make an offer – or to be totally disappointed that you can’t make one?

Here’s what you need to know before going to an Open House.

  • Be pre-approved for a mortgage by a well-known local lender. Those internet mortgage websites are convenient, but they do not hold as much clout to the listing agent as your local bank or mortgage company. Make sure your mortgage person communicates well and is available to talk with the listing agent after you make your offer. It is a very common practice for the listing agent to verify any pre-approvals that accompany offers. If your mortgage person does not return that phone call, it gives the impression to the listing agent that he or she will be poor at communicating through the entire buying process. This could hurt your chances of your offer being accepted by the seller. If you are a cash buyer you have an advantage, but you still need to provide evidence that you have the cash with a bank statement or letter from your bank stating that you have the funds to complete the purchase
  • If possible, have your REALTOR come to the open house with you so they can get an idea of the competition, and the condition and value of the property. Though they can do that just by looking at the MLS, they may be able to get some insight on the home from the listing agent who is hosting the open house.
  •  Be prepared to make an offer shortly after seeing the property. Because of the competition, most listing agents are only giving 24 to 48 hours to make an offer.
  • Make sure your finances are in shape and you have the cash to put down with the offer, which is typically $1,000, and with the signing of the purchase and sale agreement (P&S) that occurs approximately10 days later. The second deposit is typically 5% of the purchase price but that can be negotiated, especially if you are financing more than 95% of the property.
  • Once your offer is accepted you are going to have to contact a home inspector and an attorney immediately. Your REALTOR can help you with finding each of these professionals. The home inspection is typically done within 7 to 10 days of your offer being accepted, and before signing the P&S.

Being prepared is one of the most important things you can do when making an offer. There’s typically no time after an open house to contact a lender to get pre-approved since the process usually takes 2-3 days to get a solid, verified pre-approval. So if you don’t have that pre-approval letter in hand, go get it now, and then you can start going to open houses.

Jim Armstrong
Broker/Owner
Armstrong FIeld Real Estate
978-394-6736
jarmstrong@armstrongfield.com