How to Shortlist Home Buyers
When you’re selling your home, you want to ensure that you’re getting the best price possible. You also want to ensure that you’re dealing with qualified buyers who can purchase your home quickly and without any hassles.
It can be hard to screen potential buyers and figure out who is serious about buying your home.
Use our easy-to-use shortlisting guide to narrow down the list of potential buyers quickly. Our guide considers things like how quickly they can close on a sale, their credit score, and whether they have been pre-approved for a mortgage.
How quickly can they close on a sale?
The first thing that you want to do is find out how quickly they can close on a sale. You want to avoid buyers who have trouble closing quickly. It’s even better if the buyer has some form of equity in their current home so that they can just move into your new place instead of taking out a loan for both properties.
In some cases, buyers may be open to a closing date that is two weeks earlier than the expected closing date. However, they should never push back a closing date by more than a few days unless they have lost their current home in a foreclosure or short sale. If you can’t close on time, do not accept them as serious buyers.
Most serious buyers will be able to close within 15 days of the agreed-upon closing date. If the buyer can close within a week of your agreement, they’re probably very serious and should be allowed to tour the property. Ensure that you don’t let anyone sign a purchase offer until they have been pre-approved for a mortgage.
Do they have a proven track record as a home buyer?
The next thing that you’ll want to look at is whether or not this potential buyer has purchased properties in the past and what their history was like as a homeowner. Ask them for some references from their previous real estate agents and a list of homes they have purchased in the past.
You want to avoid buyers who have lost at least three properties due to foreclosure or short sale. It would be best to avoid buyers who were evicted from their previous properties because those eviction notices will show up on their credit reports.
Most serious home purchasers will have at least one or two properties in their name. How long ago was their last property purchased? If it’s been more than three years, they may not be very familiar with the mortgage buying process. If it’s been less than two years, they are likely very familiar with mortgages and can close quickly.
Also See: Buying a Foreclosed Property
Have they been pre-approved for a mortgage?
You want to avoid buyers who have not been pre-approved for a mortgage. If they have not been pre-approved, you will need to spend a great deal of time working with the bank and filling out forms that allow them to do that. Many buyers won’t even consider a home until they have been pre-approved.
When looking for potential buyers, make sure that they have been fully pre-approved.
If they haven’t been fully pre-approved, ask them exactly what steps are required to be pre-approved. You should also make sure to do your research by speaking with their local bank and learning more about the mortgage process.
Do they have a down payment?
The last thing that you’ll want to ask your potential buyers is whether or not they can make their required down payment. You should also find out how much of the purchase price you will need to provide for making one. Most home purchasers will require at least 20% of the purchase price for their down payment.
If they do not, you should consider whether or not they will be able to afford the home you are selling. Some buyers may be willing to pay your asking price if they are confident that they will sell their house quickly; however, most purchasers will require a larger down payment to compensate for the increased risk they are taking on.
What is the best way to shortlist potential home buyers?
You want to avoid buyers who do not have a down payment and cannot offer proof of an ability to sell their current home quickly. Make sure that you have the time to work with potential buyers who are willing to put in extra time and effort for a quick sale. Always make sure that your prospective buyers have a pre-approved mortgage before allowing them to tour your property. If they don’t, then they should have a good reason.
To shortlist potential home buyers, you’ll want to look for buyers who have a down payment and can show you proof of an ability to sell their current home quickly. You should also make sure that they are pre-approved for a mortgage with a local bank, as this is often the best way to ensure that it will be easy for them to buy your house.
You may also want to ask your potential buyers about their offers. It would be best if you looked for buyers who are confident that they will be able to buy the house; however, you may also want to look for buyers who are willing to offer less than the asking price because many of these purchasers will need to make some sacrifices to move quickly.
While most home purchasers will have a down payment and be able to show you proof of an ability to sell their current home, some purchasers may still require extra time to complete the sale. If they do not have a down payment and cannot prove that they will buy your house quickly, you should consider whether or not it is right for you to wait. You may want to connect with other sellers or work with another broker if you are concerned about the timeline for sale.
What documentation should you ask for from a potential buyer to shortlist them?
You’ll want to ask for a copy of their pre-approval letter, as well as the address and square footage of the last property that they purchased. A good pre-approval letter will include their income, how much they have set aside for a down payment, and detailed information about the mortgage itself. This is often the best way for you to determine whether or not they can afford your house. Other documents like their W-2s and bank statements may be necessary for you to determine your buyer’s credit score, address, and square footage of their last property purchase and other information.
Most home purchasers will have a copy of at least one pre-approval letter, often from their bank or credit unions. This is often the best way for you to determine whether or not they can afford your house.
How long can you wait before settling on a buyer?
It would be best if you considered whether or not they need to move in the next two weeks; however, you’ll want to avoid buyers who cannot give you a firm timeline and definite closing date. You should always know how much time and effort your prospective purchasers are willing to invest to ensure that the sale goes smoothly.
You should make sure that the timeline for the sale of their current home is reasonable. While some purchasers may need more time, you’ll generally want to avoid buyers who have a short timeline without a good reason.
For many home purchasers, the closing date is important because it affects their timeline for moving. It would help if you asked your prospective buyers how much time they are willing to invest in the sale of your property and whether or not their current deadline is reasonable.
Whom should you avoid shortlisting as buyers?
You should avoid shortlisting too many potential purchasers, as this will make it more challenging to sell your property. Remember that some buyers may only be interested in specific homes, and you don’t want to waste time on people who won’t buy the house.
You’ll generally want to avoid those with no down payment or those wishing to purchase your home without selling their current one. It would be best if you also avoided buyers who aren’t already pre-approved by a local bank, as this is often the best way to ensure that it will be easy for them to buy your house.
What other questions may you want to ask?
When you meet with your prospective purchasers, you’ll want to ask a few important questions about their preferences. For example, you may want to know whether or not they plan on having any pets in the house and if they have children or not. You might also ask them how long they have been looking for a property, as well as how they found out about your house.
Shortlisting home buyers is a complicated process, but it doesn’t have to be. You’ll want to ask them for their Letter of pre-approval and find out about their timeline before agreeing to show the property to avoid wasting time on those who can’t afford your house or don’t plan on living there long-term. When you meet with potential purchasers, make sure that you’re asking questions they will understand and answer accurately to know if this person has what it takes for your property.