The Official Guide

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM. 1. The Official Guide. Stop losing your dream home to other buyers in the Seattle and Eastside Real Estate market. It's time to win.
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The Official Guide Stop losing your dream home to other buyers in the Seattle and Eastside Real Estate market. It’s time to win.

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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You are probably reading this because you have been searching for the perfect house to call home. You may just be entering the market and doing some research. Here is what usually happens to the drained buyers reading this: You find a house with your Realtor, make an offer, and boom – another buyer somehow beats your offer. Rinse. Repeat. It’s agonizing. I feel the pain you are going through. I still go through it sometimes as well with my own clients. I used to always lose in multiple offer situations. Other buyers outbid us, had better financing than we did – I mean, that’s what we heard at least. As a buyer you will never really know 100% how you lost to a competing offer. Usually the selling side is just trying to let you down easy with some kind of an excuse. It’s like a bad breakup, but instead they say “It’s not you, it’s someone else, and I can’t tell you who they are or what they did.” How horrible is that? It is so hard to get emotionally attached to a home, envision where your new furniture will go, and start brainstorming how a new accent wall would look – just to have your heart shattered with news that you didn’t get the house. I want you to know that there is a 100% proven way to compete. There is a sure fire way to eventually win, sooner than you think too. It will take some will power, some tough choices you will need to make, and a little faith. I know this whole thing seems frustrating. If you have been searching for a bit, you might even feel like giving up. If you have the money to buy a home, try to avoid renting. Your payments will be similar, but with a home you have equity that will make you money – imagine all these homeowners out there today selling their home in our market today. They are cashing in. Unless you are buying a tear down home to remodel and flip for some quick cash – remember that real estate is nearly always a long term investment, a very good one. Keep up the good fight, it will be worth it in the end  Feel free to reach out to me below if you have any questions or want help winning in our competitive market! I wrote this guide as directly as I possibly could, sparing no details. I hope you find this guide useful! ~ Kevin

Kevin Boroumand Realtor / Real Estate Broker Realty ONE Group Eastside (206) 734-1053 [email protected]

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Why is The Market So Competitive? Getting All of Your Ducks in a Row Preparing to Compete With Very Motivated Buyers Pre-Qualified Vs. Pre-approved vs. Pre-underwritten Research and Building Rapport Determining Offer Price + Escalation Clauses (How Much are You Willing to Pay?) Waiving the Inspection Contingency Waiving the Financing Contingency Closing Date and Flexibility Earnest Money and Waiving the Ability to Get it Back Earnest Money and Down Payment Amount Offer Protection Certificate Creating a Winning Offer Letter Offer Delivery Strategy The Waiting Game Closing Statement + The Golden Rule Schedule a Consultation + Free Home Buyer Tools

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Let’s talk about the market a little bit – you may have heard this stuff before, but it’s good for the context of this e-book. The general Seattle area has been going through a big shift the last couple years. More and more companies such as Facebook, Alibaba, and Amazon have been creating an insane amount of jobs here. People from different states have a lot of these jobs that force them to move here. Since they have no option but to move here, they most likely need a place more than you do. This is one of biggest reasons why home prices have gone up in our area. The inventory of homes in the area is at a record-shattering low, mainly because the people that have lived here for years either can’t afford to move after they sell, or don’t want to compete with multiple offers since they will need to buy after they sell. See the cycle? Investors/Relocation buyers won’t stop coming, and home owners don’t want to sell because of the demand the investors and relocation buyers are creating for the buying process! Another reason for the demand are foreign investors. Sotheby’s reported that 50% of their home sales in 2016 were to Chinese investors. The Chinese are buying with mainly all cash, which in multiple offer situations are almost always much stronger than offers that contain some sort of financing. These deals close faster, and don’t require a funding process like a loan does, which could make a deal fall An appraisal is an estimate of a home’s fair market apart. But as far as the market goes, value. Let’s say you wanted to finance your home with these all-cash offers are inflating the a conventional loan and your offer was accepted. The market, because they are able to bank would hire an appraiser to find the fair market offer a higher price by nature and value and make sure they are not lending more than bypass appraisal. what the home is actually worth. Lastly, in 2016 Vancouver B.C. implemented a 15% tax on foreign buyers purchasing homes in the area, which only naturally attracted all of the investors from there into our area. All of this is a recipe for a market we have never seen before. It’s incredible.

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Home buying in the Seattle & Eastside area is a different beast nowadays. Every single detail will matter when looking and making an offer on a home. You will need to be thoroughly prepared. You can lose due to the tiniest missing piece.

Every single detail is crucial to beating multiple offers anywhere in King or Snohomish County Keep in mind, no matter how well you prepare to make an offer on the perfect home, you will still most likely lose on a couple homes. Even the best agents can’t always help you win on the first home. Our market is full of extremely motivated buyers, and even with this guide there is no way that we could guarantee a win for you. But - it becomes a problem when you start losing consistently, specifically when you and your agent (if you have one) don’t make any adjustments to your game plan. There are several crucial steps you will need to go over to ensure you are doing everything possible to compete with multiple offers, such as offers with less contingencies, stronger/different financing, and much more. We will go over different steps and help you understand why each is important, and all the circumstances you could expect.

In a real estate transaction, a contingency creates an instance where a buyer can exit a transaction and get back their earnest money. The more contingencies you have, the weaker your offer becomes to the seller.

Are you ready to finally win in this market? On the next page we will go over expectations, what you need to prepare yourself to enter the buying market, and emotionally preparing yourself. Ready? 

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Getting pre-approved with the absolute best lender This will always be the first step: Knowing what you can afford. You will need to be pre-approved before even sending an offer on a house. Home sellers will not be confident in your offer in a multiple offer situation if you are not pre-approved and another buyer is. The problem is many home buyers don’t pick a lender based on the ability to close, but rather pick the one with the best rate, or a big name they feel they can trust, such as Wells Fargo. Yes, you can definitely lose because of who you go through for your loan. Let’s say you and another buyer have the exact same offer, except you are preapproved through a big lending institution such as Wells Fargo or Bank of America, and another buyer is pre-approved through a smaller institution such as Caliber or Guild Mortgage. The 2nd buyer will almost always win. Why? Let me explain:

 Closing date - Larger companies like Wells Fargo, Bank of America, and Chase, will almost always take longer to close on a home. It takes multiple people to complete the loan funding process, and with the big companies these people are usually in different states. The underwriting process takes a lot longer. They handle many loans every month, so the level of importance placed on your transaction is not as high as a smaller company. A seller would much prefer to take an offer with a company that is known to close quicker.  Communication - Smaller companies tend to have much better communication during a real estate transaction, which is much more favorable to a seller who wants to know what is going on during a sale. These lenders usually treat their job more as a business like Realtors do, and are available to be contacted outside of business hours (if they are a

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good lender, of course). There are obviously exceptions to this. There are lenders at the big companies that are extremely competent. I know plenty. The problem is, unless a sellers agent knows that lender, they will almost always judge your pre-approval letter on the company, not the lender.  Appraisal - This is huge, especially in our market. A smaller company will tend to pick an appraiser that knows the local market of the home you want to buy, and is close to the subject property. A big company like Wells Fargo randomly chooses an appraiser that could very well be out of the area of the home. Why is this important? If the appraiser is unfamiliar of the condition and geographic location of your home, they might have a difficult time finding value. Imagine an appraiser from Arlington, WA coming to the Houghton neighborhood of Kirkland to appraise a home you want to buy. A seller will much prefer a lender that will choose an appropriate appraiser for that local market. You will find out why on the waiving financing portion of this guide.

My preferred lender for multiple offer situations

I thought it would be good to include a lender option here to help some of you out. Taylor is an excellent lender that I have sent my home buyers to in cases where we had to enter a very competitive area. She is excellent in multiple offer situations; keeping an open, honest, and constant communication with all parties. She is on Team Gosser as well, the #1 lending team in the entire state of WA. I highly recommend giving her a call if you are in the market, or want to get started. Tell her Kevin sent you!

Apply Now: www.TaylorWinkler.com

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Knowing your Real Price Range This will save headaches of half the exhausted buyers reading this. Once you get your approval from your lender, you will know what you can afford, and what your price range is. The most important thing to understand is what I like to call a Real Price Range. This type of price range is usually applicable to a market like ours where homes can get bid 10-20% over asking price in highly desirable areas. Here are some areas that will require you to know this number:  Bellevue, Kirkland, Seattle, Issaquah, Renton, Bothell, Mill Creek, Everett, Snohomish, Shoreline, Edmonds, Woodinville, Lynnwood, Brier, Kenmore, Mountlake Terrace Basically, take the highest amount you can afford, and take off 20% to find your Real Price Range. For example, if you were approved for $650,000, you should be looking at homes around the $520,000 range. Why?

1. Many home sellers will price their home slightly under fair market value. This will cause buyers to get excited, generating a ton of offers. Most of the offers will most likely go over asking price, so if you are bidding on a house that is already at the top of your price range, you cannot compete on price – which means you will most likely lose.

2. Let’s say you and your agent determine you need to bid 100K over asking price to be competitive. There is a chance that the appraisal might come in low, and you will need to cover the difference in cash. In this case, you can lower your down payment amount to cover the difference. You will only finance the appraised amount, so the difference in monthly payments shouldn’t be too big. You must have proper expectations of what type of house you can really afford. Not all areas go 10% over ask, just depends on the house. The lesson here is: Don’t look for homes that are already listed at the top of your price range.

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Hire a Realtor that is groomed for this type of market This step could make your home buying journey a breeze, or a complete nightmare. You will need a dynamic agent. I would not recommend working with a close friend or a family member that is an agent. This process could get very messy for many different reasons. Interview agents you don’t know. Agents that come by recommendation from your friends. Look at reviews for agents in your area. Interview me. It’s better to work with an agent that isn’t in your tight circle if he/she messes something up, ending in you losing your dream home. It’s just not worth the risk of burning a close relationship or making things awkward. It’s easier to fire someone you aren’t close to if they are incompetent. Don’t fall into this common trap.

Here are 3 traits you should look for in an agent based on our market:

1. Extremely responsive – How long does it take for them to respond to messages and phone calls? Send time-sensitive documents? Seriously, if your agent is slow to respond, make important phone calls, or get offers out – you need to dump them and find someone that actually wants to make homeownership happen for you. Your agent needs to pick up the phone all the time, and if they don’t, call you back within 10 minutes. They need to write up offers quick and efficiently. They need to update you with important information immediately. These traits cannot be compromised. This trait alone is why some older Realtors haven’t survived in this market.

2. Persuasive negotiator – It’s just not enough to write a brilliantly written offer. An agent could know exactly what type of offer to write, but if they cannot properly sell themselves and you to the other party, you could most definitely lose. The listing agent will want to talk to your agent and see what type of people they are dealing with. You need someone who is energetic, can win over anyone, and pair that with your strong offer. If the listing agent trusts your agent, they will feel more comfortable with your

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offer over a similar, competing offer. They would prefer to work with you because of your agent!

3. Strong character – This is hard to come by these days. The real estate industry has a stigma for greed, dishonesty, and so on. Luckily there are some fabulous Realtors out there (*cough*). You absolutely need to work with someone you can trust. They need to be calm in heated situations, be honest when it’s tough to be, and treat your business with the utmost care. They obviously are motivated to make money and win your business, but they will not compromise their integrity in the process. An agent with these traits most likely will possess good negotiation skills as well, but they don’t always come hand in hand. • As a bonus, make sure your agent is an actual Realtor. There is a difference between real estate agents and Realtors. Realtors have a code of ethics they must abide by, and generally are more competent. This should help you choose an agent more efficiently.

If you have all these steps in line, you are ready to start looking at homes. Once that next home comes up, you will be armed with the best strategy to beat multiple offers. It all begins on the next page.

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If you really want to compete in this market, you will need to be able to compete with all-cash buyers. One of the biggest benefits of purchasing with cash is how fast the deal can close (how fast the seller makes his money!). You have probably heard of the terms “pre-qualified” and “pre-approved” – these are ways to communicate to the seller that you are a strong buyer and can actually purchase the home. What you want to do in this market is get pre-underwritten. Let’s talk about these processes:

1. Pre-qualified – The lender gives you a pre-qualification based on you verbally telling them how much money you make. There is no verification in this process other than a credit check. This is the weakest form of lender approval. It can take longer than 30 days to close since the lender will need to verify your pay stubs, tax returns, and etc. during the transaction. This is a sure fire to lose in a multiple offer situation.

2. Pre-approved – This is the most common way to present your ability to buy to a seller. You fill out a full application, provide pay stubs, tax returns, and a proof of funds. Your debt to income ratio is checked, and of course, your credit is pulled. This is still a strong route to take. Good lending institutions can close in 30 days.

3. Pre-underwritten – This is the absolute strongest form of lender approval. Everything during the pre-approval process is done, and the underwriter looks at your paperwork ahead of time and determines that you are set – you just need to find a place! An excellent lender can close in 21 days if you are pre-underwritten. Some lending institutions also offer a credit ($5,000 with some lenders) if the loan doesn’t close in time. This could be huge if you can’t close and lose your earnest money – you could get some or all

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your earnest money back (depending on how much earnest money you put down).

Remember, the more you prepare during the approval process, the much easier it will be to compete with cash buyers and be taken more seriously with the sellers you will encounter. My preferred lender mentioned earlier can help you get approved very quickly.

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Finally! You found the home you put an offer on. Now what? There are 4 things you and your agent need to do before writing anything:

1. Subject Property Research - Find recently sold properties that are very similar to the home you want to make an offer on. It will give you a range of what you can expect to pay for the home. Looking at the listing price to determine what to pay will not help you. You want to see what the homes in the area have actually sold for. A good rule of thumb is to see what has sold in the last 6 months, and look at the pricing trend as you get nearer to the present. It can be a good gauge of what you can expect to pay.

2. Rapport & Qualification – This is very important, especially in such a competitive market. Your agent must call the listing agent and start building rapport with them. They will need to start talking you up, being candid and honest in the process. He/she needs to find out why the seller is selling. Finding out what is most important to the seller is crucial when crafting the best possible offer. The listing agent will usually tell you the seller’s motivation in selling, if price is the absolute most important aspect of a winning offer, or if certain terms are more preferred. I call this qualifying the seller. The seller is always looking for the most qualified buyer, but many buyer agents in our market don’t think to qualify the selling side as well. Building value is a must and is almost always ignored. You want the listing agent to be excited when they receive your offer, because they will most likely try to sell you to their client when there is another offer competing with you. It is NOT enough to just send an offer and cross your fingers without implementing this step. You will lose.

3. Emotional Preparation – You need to prepare yourself emotionally to lose. Like stated before, even the best agents and the most qualified buyers will

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lose a couple times. Sometimes you can win on the 1st try, but it is a terrible expectation. Sometimes it won’t matter how strong of an offer you put together, and how much rapport you build. The market has incredibly motivated buyers that will do anything it takes to win a house. There are families that desperately want to send their kids to a certain school within a school district. Or be close to their relatives. I’m sure you may have these same motivations, but some people are willing to go even further than you. The trickiest part of this is you will never know what other people are offering. As hard as it is to not get emotionally involved when you find the absolute perfect home, you just shouldn’t do it. I know it’s easier said than done, but start getting more excited after your offer gets accepted. Effort is better than none. This is where a confident/sensitive agent can help keep your spirits up and moving forward.

4. Is the offer review date negotiable? – This is where the best agents are winning for their buyers in this market. This ties in to your agent building rapport with the listing agent, because you absolutely need to find out if the seller would accept a strong offer before the offer review date. Some sellers will be very clear that they will not look at any offers before their set review date. You must find this out to create your offer delivery strategy. If you fail to find out, you could be waiting until the day of the offer review, just to find out that another buyer sent a strong offer that was accepted a couple days prior. Be vigilant in asking questions. Losing is bad, it’s even worse when you missed your chance to even try.

An offer review date is usually a set date and time when a seller is expecting all offers to be delivered by all buyers. In theory, the seller is stating that no offers are going to be considered before this set date. This is not always true, especially with the exceptionally strong offers sellers are receiving in our current market. You and your agent need to find out if the seller would consider accepting an offer before their review date or not.

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Finally! You found the home you put an offer on. Your agent talked to the listing agent to build rapport, and discovered some of the seller’s motivations. You have gone through some similar sold comparable properties as well. Now what? Let’s start with determining a proper starting price and add an escalation clause to it. An escalation clause is an addendum you add to a contract that increases your offer price if another competing offer beats your initial offer price. With an escalation clause you choose the increment of which you are willing to beat a competing offer by, and also choose the highest price you will bid up to.  Example: You offer full asking price on a $550,000 home. You add an escalation clause saying you will beat any offer by $5,000, until the number hits $640,000. If someone else offers $597,000, your offer would stand at $602,000 if the sellers chooses to accept your offer. If someone offers $637,000, your offer would only increase by $3,000 to $640,000, since that is your cap. You must ask yourself how much you are willing to pay for your home. Do you absolutely love it? Does it fit all of your needs? If someone beat you by $10,000, would you be okay with that? Keep in mind that a $10,000 difference is not going to affect your monthly payments by much. If you are paying with all cash, you have a little more power because you will be avoiding the appraisal process. You can bid extremely high. Even in a market like this, you can still overpay. But in many areas, it is not strange to see homes going 20%+ over asking price. If you are financing the home, you can still be in good shape if you are making a considerable down payment. If you bid super high, a good lender can work some magic by choosing an appropriate appraiser.

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Typically in the past, you would make an offer on a home, get it accepted, inspect the home to make sure there aren’t any major issues, and then move forward or walk away from the deal. Obviously, this is what I would usually recommend to most of my buyers. The problem is, in this market you are competing with a ton of buyers that are all waiving the inspection contingency. Sounds crazy right? If the home seems like it could have problems, it is crazy. But there are crazy buyers out there that will do anything to win. If a seller receives a similar offer from you and someone else, but the other offer waived the inspection, they will most definitely take that offer – even if it’s lower. In this case your offer is suggesting there is a possibility you will back out, while the other offer is offering a good faith that the deal will have zero road blocks. You tell me which offer you would prefer to take. There is no other way for me to say this: If you want to buy a desirable home in a highly desirable area in Seattle or the Eastside and refuse to waive the inspection – you will most likely lose. There is a way around this, sort of. It’s called doing a pre-inspection. Basically, you go see a house you really like and pay to have the home inspected before you make an offer on the home. In theory it’s a great idea. There are two problems though:

1. A pre-inspection can cost anywhere from $350-$700 depending on the size of a home. If the seller doesn’t accept your offer, the several hundred dollars you just spent went down the drain. It can get very costly if you do this every time you make an offer.

2. Considering the speed of this market, a pre-inspection might not even be possible for you to execute. A seller might not even allow one. If you are doing a pre-inspection, chances are other buyers will be touring the home while you inspect the property. You are essentially sending a signal to all KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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the other buyers to compete harder to beat you. Chances are slim to none that you can do a pre-inspection in private. The seller wants as many buyers to see the home as possible. Don’t expect special treatment, you will be one out of many.

Lastly, some sellers will pre-inspect their own homes before putting them on the market. This could offer you some peace of mind and help you make a strong offer without reservations. All in all – if you want to have the strongest possible offer, you will need to waive the inspection contingency. A good agent will be able to help you decide if a property in question is worth it.

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Waiving the financing contingency is only applicable if... well, you are financing the home in question versus buying it with 100% cash. By removing this contingency, you are communicating to the seller that if for whatever reason the deal falls apart due to you or your lender’s inability to close, you will let the seller keep the earnest money. There are a couple things that can occur when removing this contingency:

1. You are waiving the appraisal contingency as well. This means if the appraiser decides the home is valued less than what you are offering, you will need to cover the difference in cash. If you cannot offer to cover the difference, you will either lose your earnest money and the deal will be cancelled, or the seller can choose to sell to you at the appraised value (or they can offer to cover part of the difference).

2. If the lender cannot write your loan for whatever reason, you will lose your earnest money. Even if you are pre-approved, this could easily happen if you decide to finance a new car before the loan is written. Once you are pre-approved, avoid pulling your credit or financing anything, anywhere, at all costs – until the home is yours.

If the area is a super-hot market like Bellevue, a low appraisal is unlikely. A good agent will be able to guide you and give you an idea of what to expect. Keep in mind, an agent will never know what the home will appraise for. You will need to be well prepared here for the worst, and be able to adjust your down payment if it is large enough to cover for a low appraisal. This doesn’t happen all the time, but it can happen. You need a knowledgeable agent and an excellent lender that understands the local market in this situation. It is crucial.

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When competing with a multitude of buyers, sometimes the winning offer will come down to how flexible you are with the seller and your closing date timeline. All-cash offers will almost always close faster than financing offers, there is no way around it. You can speed up the financing process in your preparation phases by getting pre-underwritten with your lender (as discussed earlier). This should help you close in the fastest time possible, and will communicate to the seller that you responsible and won’t be a nuisance if they accept your offer. If you are financing the home in question, you will need to offer ample time for your lender to close the deal. Yes, you want to close as fast as possible, but if you waive all contingencies and you cannot close in the timeline, the seller could cancel the deal and collect your earnest money. Bad risk to take. Home sellers will sometimes ask for a week or two (sometimes longer) of postclose occupancy of the home to have some time to move out. They may even ask for you to rent back the home to them for a month (sometimes longer). As excited as you may be about the home you want to buy, you don’t want to reject these requests. For some sellers the terms are sometimes just as important as the money. You want to be absolutely flexible and honor these requests, as most people you will compete against will honor the requests as well. Some other things you may run into that you may want to be flexible about:  The seller wants to take the fridge, stove, etc. with them.  The seller wants to take attached items such as television wall mounts, chandeliers, fire insert, etc.  As far as showings go, the seller may have a strict guideline of when you can see the property. You and your agent have to ultimately respect their wishes, but also try to persuade them in a kind way to see the home as soon as possible. Act flexible and accommodating, they will remember that during the offer review period. Your agent will help you decide what the best angle will be to approach all of these scenarios. These details, while seeming small, are still very important.

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I guarantee that some of you reading this just had a mini heart attack. And I totally understand why, obviously. In our market, this is the cherry-on-top assurance to the seller that you will close smoothly and on time, with no issues. I will explain the pros and cons, and why it doesn’t seem as bad as it sounds. In real estate transactions, the earnest money serves as a good faith deposit to the seller that you are ready, willing, and able to buy their home. Historically, earnest money is usually between 1-3% of the home; but in our market, buyers are putting down much more to compete, which I will explain further down. The earnest money is usually refundable to the buyer when a deal cannot close, due to a multitude of factors. Nowadays, like explained before, motivated buyers are waiving all contingencies to compete, which removes many parts that state that the earnest money is refundable to the buyer. And to be extra aggressive, they are waiving the right to receive back their earnest money, no matter what. The most aggressive strategy would be to write in the offer, “Earnest money is non-refundable, and immediately released to the seller.” To the agents reading this, it would be best to write this in the “other” section of the very bottom of Form 22D. Usually earnest money is held at escrow, but in this circumstance, you are giving it directly to the seller. This is becoming very common in some of the hotter suburbs and neighborhoods around Seattle.

Let me explain to you why this isn’t as bad as it sounds: 1. If you choose the right lender and get pre-approved, you will not have to worry about your loan closing. We highly recommend going through the pre-underwriting process if you are going to waive all contingencies.

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2. Prior to writing an offer, you and your agent will want to have a discussion with your lender on setting a closing date. You want to close as fast as possible, but when you waive all contingencies, you want to set a closing date that is attainable to avoid asking for an extension. In this situation the seller could take advantage of you and take your earnest money if they reject your extension request. 3. As long as you do your due diligence and don’t willingly back out of the deal, you won’t lose any earnest money. If the seller does not do their due diligence, and because of them the deal doesn’t close – you will get your earnest money back as well.

It will be much easier to waive all contingencies and waiver the right to get your earnest money back if you choose the right team. This team needs to consist of a lender that can pre-underwrite your loan and keep constant communication with all parties, and an agent that proactively guides each step of the transaction and stomps out any issues before they occur. This is a risky step to take if you don’t have the right team, do not waive the financing contingency or any earnest money contingency if you are doing your mortgage through a big bank. On the next chapter, I will explain how an Earnest Money Protection Certificate works, and where to get one.

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While having an amazing lender and a good plan help in preventing problems – there is always a risk when you are waiving all contingencies. There are a very few lenders out there that offer Underwriting Credit Approval Protection. If you can get one, it can make you feel much more confident about procuring the strongest possible offer.

This is how it works: If you waive the financing contingency and the loan doesn’t close on time, the lender will give you a portion of your earnest money back – even if you lose the money to the seller!

Obtaining a certificate Team Gosser at Guild Mortgage was gracious enough to give me certificates to send to you, covering $5,000 of your earnest money. That means if you offer $5000 in earnest money, you could get it back if the loan doesn’t close! If you would like to get one – shoot me an email: [email protected]

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Sometimes when a seller receives competing offers, the competition is so close that they may end up looking at how much earnest money + down payment money the buyer is offering.

Earnest money amount A larger earnest money payment communicates to the seller that you are very serious, and your offer will probably be the easiest to deal with as well. You can offer as much earnest money as you want – this money will go towards the home purchase or down payment. Make sure to have all your ducks in a row with your lender like we discussed above. You want to be as aggressive as possible with your earnest money deposit.

Down payment amount This the money you are paying as a down payment on your loan. Depending on what type of loan you are getting, you are paying at least 3%+ down (in some cases zero down – reach out to our preferred lender for more information). If possible, make a larger down payment so you can wipe out the mortgage insurance (at least 20% down). But for the purposes of beating multiple offers, a larger down payment is another signal to the seller that you are a very well qualified buyer. It makes your pre-approval or pre-underwritten approval look extremely solid, whereas someone putting 5% down may look weaker as a buyer in a multiple offer situation.

I understand that not everyone can put a 30% down payment on a home, but if it is possible, it will make your offer stronger. You can definitely still win with a 5% down payment. It might be harder in a bidding war where there are 10+ buyers competing though.

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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I know we’ve been talking numbers and contingencies this whole time. For some sellers, letting go of a home is an emotional experience. They may have lived in the home for 20+ years, and are hoping that the new buyer will take good care of their home full of cherished memories. You will want to cover your tracks and produce a touching offer letter. This offer letter will contain a little bit about yourself and your family, and will be written as a narrative that is directed to the seller. Explain to the seller how much you love the home with specific details. Observing the home when you first see it should help you produce a more emotionally grasping letter. Talk to the neighbors and mention how you met one of them – name drop. Tell them how much you love the neighborhood and all of the scenery. If you have kids, tell them how desperately you want your kids to go to the nearby school or school district. Anything emotionally gripping about your story will help you engage the seller emotionally in their decision. Adding a picture is another big plus. If you have a significant other with kids, add in a nice family picture. Mention the names of all the family in the photo, including their ages. I can provide many examples of these offer letters if you want ideas. Shoot me an email: [email protected]

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KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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At this point you have been approved by your lender, you found a home, your agent has built rapport with the listing agent, and you have a winning offer ready to be sent. Now a couple steps need to be executed:

1. A phone call to the listing agent. Your agent will need to ask what you guys are up against as far as other competing offers go. Most likely, the listing agent will not tell you the specifics of the other offers on the table. Sometimes you can come away with new information to adjust your offer in case there is much more competition than expected. This phone call is absolutely crucial. 2. The phone call should yet again solidify the rapport your agent built with the listing agent prior to writing your offer. A couple laughs about the crazy market and another assurance that you are a great buyer with a great lender should suffice. 3. The offer will be emailed to the listing agent (co-listing agent if available), both brokerages that the agents represent, and Bcc’d to you for transparency. The offer email should include another paragraph or so reassuring the seller that you are a top notch buyer, and that you decided to go above and beyond to ensure you win the home. The email should also include an outline of the offer attached so it’s easy for the listing agent to come back to, clear contact info for your lender, your offer letter, and preapproval attached. 4. A text message to the listing agent letting them know that you have sent the offer and asking them to confirm receipt. This is another little assurance to the selling side that you and your agent are very thorough.

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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This process can be agonizing. Sometimes the seller has to sift through as much as 20+ offers. You might have to wait 24-48 hours to see if your offer gets accepted. Your agent will give you updates as they come in – try to keep calm and know you did the absolute best you can. Sometimes the listing agent will play the bidding war game and try to get you to go up in price. They may do this to get another buyer to go even higher – so bidding higher may just be a waste of time. You will truly never know if you will win even if you bid higher. I strongly disagree with this practice. It is not supported by the REALTOR association, and most agents with integrity will not do this. If you end up being put in this spot, consult your agent to devise the best strategy to approach it. Every home transaction will be completely different. You very well might still lose. Like I stated before, this market is chock full of insanely motivated buyers that are being consulted with the information you are reading. The hope is that you and your agent devised the perfect strategy, and you end up winning your dream home!

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The good news is most agents cannot implement every step on this guide because it requires a lot of intangible qualities to execute. This means if you have great representation from a loan officer and a Realtor, you should have a great shot at winning sooner than later. Just because there is lots of competition doesn’t mean you won’t win – just make those adjustments and be persistent! Do not leave out any steps - remember The Golden Rule:

“If you can do something extra to win - no matter how small; you can lose by something extra - no matter how small”

To summarize what it takes to beat multiple offers: 1. Work with a lender that can pre-underwrite a loan, and works with a wellknown, smaller scale lending institution. Great communication is vital. 2. Find an agent with the steps on page 8-9. They need to be excellent at writing winning offers, and enough intangible qualities to build value to the selling side. 3. Provide the largest earnest money and down payment amount that you can. 4. Waive as many contingencies as possible. Each house will be a different story. 5. Write a personal, emotionally gripping offer letter to include with the offer. 6. Be patient and persistent. If you can lose and move on to the next home with ease, you should have your home in no time. Don’t give up!

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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Schedule a no obligation consultation No matter what stage you are at in the buying or selling process, I’d love to meet you and see what I can do for you. I’m really low pressure, and have a passion for helping you find solutions. Whether it’s beating multiple offers, selling your home for the most money, or answering any of your questions – I’m more than happy to help. I’m more than willing to meet you wherever – work, home, coffee shop, or a bar. Give me a call or shoot me a message. Can’t wait to help you out!

Kevin Boroumand Realtor / Real Estate Broker Realty ONE Group Eastside (206) 734-1053 [email protected]

Free Home Buyer Tools www.BothellHomes.com Search any home in Western Washington, not just Bothell. My site allows you to view every single possible listing available from every brokerage in our state. Listings are updated faster than Redfin. No sold or expired listings either, so you don’t have to fall in love with a home just to find out it’s already been sold!

www.HomeValuesNorthwest.com Get an idea of what your home is really worth. Much more accurate than Zillow’s Zestimate, which can be 10-20% (or more) off depending on the area. You can also get a free CMA to understand exactly how much you should price your home at to sell in our current market to garner as many offers as possible.

KEVIN BOROUMAND | WWW.BEATMULTIPLEOFFERS.COM

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