Six Things To Do Before Making an Offer

Tuesday, October 30th, 2018

To help you prepare to hit the market as a potential property buyer, there are some tips that can help reduce some of the stress of making such a huge financial investment – and boost the chances of your offer getting accepted to help you beat the competition.

Sort out your finance

The sooner you get your finance approved, the better – and that means starting the process of applying for a mortgage – and receiving home loan approval.

Obtaining pre-approval is an important first step because it gives you the peace of mind that comes from knowing exactly how much finance you have access to – something that is critical to keeping your property ownership dreams a grounded reality. There is no point falling in love with a property that exceeds your maximum price. By securing mortgage pre-approval, you know exactly what offer you can put in, without worrying.  As banks and lending institutions tighten their lending policies, pre-approval makes everything clearer to help you focus on finding the property to suit your needs – and your budget.

Focus on the Details

Due diligence is something lenders are taking more seriously these days as lending criteria tightens. To meet their needs for details about your financial situation, it’s important to present a clear picture of your incomings – and your expenses. Lenders want to see documented proof of your spending habits to help them feel sure you can afford to repay your debt and meet your ongoing payments. Make sure you factor every expense, from groceries, to petrol, to car insurance and health insurance – as well as all the other ongoing bills you pay to keep your lifestyle afloat.

It’s not just of benefit to your lender. Taking on a mortgage – or any personal or commercial loan – is a serious thing and should be done with care. By having a full understanding of your budget, you reduce the risk of getting in over your head.

Know Your Numbers

Value is a difficult thing to measure, but by researching what is around in the property market and what prices properties have sold for, you will build your knowledge of comparable prices and this is vital to help you make informed decisions about what offers you should put in on properties you are interested in. Buyers looking for a dream family home can often let emotion get in the way and feel compelled to offer more than the property is actually worth. For potential investors, though, it is even more important to view the decision to buy from a business perspective. Be realistic about what you need from your property, as well as what you need to put into it to get it to the condition you need it to be in. Applying for the mortgage is one thing, but if your finance only covers the purchase, and those renovations you need urgently can’t be attended to until you have equity in the property down the track, you may be over-reaching your financial limits and buying a costly mistake.

Set The Rules

Whether you plan to purchase a property via auction, or private sale, being sure that both you and the agent you are working with understand the rules of engagement that will impact on the way your offer is made – and whether it is accepted – is a critical step to feeling confident about the purchasing process.

By making sure you understand the expectation of the sales agent – and the vendor – to help you understand what you can do to get your offer across the line, you put yourself in a far better position to boost your chances of buying success.

Be bold

Buying a property is no time for shyness.

To help the agent understand your intentions and relay them properly to the vendor, it’s vital to be clear and confident with what you offer.

It’s true that the line between seeming too keen and making sure you are kept informed along the way can seem very fine but sometimes, asking the most obvious questions, such as, ‘what will get them to sell this property to me?’ can work wonders on keeping things transparent and easily understood.

Keep it Simple

Attempting to buy a property with a litany of conditions attached to your offer is a recipe for disaster. Mentioning the importance of pre-approval here again is important. If your offer is subject to finance, the vendor may get nervous and, if you’re competing against a buyer with no conditions to their offer, it does put you on the back foot. To help you prepare to buy the property you want, talking to the selling agent to check on the vendor’s ideal terms of settlement can give you the inside track on what you need to do to secure the property.

Remember – taking on any finance is a serious matter and when you’re planning to make what could be the most significant financial decision of your entire life, there is no such thing as too much research. By feeling properly prepared, you’ll make smarter decisions that will help protect you in the long run.


For advice and insights into pre-approval for your home loan, talk to our mortgage broking experts at Loans Actually.

Leave a Reply

Your email address will not be published. Required fields are marked *