Do
you want to get the best house you can for the least amount of money?
Then make sure you are in the strongest negotiating position possible.
Price is only one bargaining chip in the negotiations, and not
necessarily the most important one.
Often
other terms, such as the strength of the buyer or the length of escrow,
are critical to a seller.
It
was a normal practice to have a buyer get "pre- qualified" by a lender. This means that you
spend a few minutes on the phone with a lender who asks you a few
questions. Based on the answers, the lender pronounces you
"pre-qualified" and issues a certificate that you can show to
a seller. Sellers are aware that such certificates are WORTHLESS, and
here's why!
None
of the information has been verified! Oftentimes-unknown problems
surface! Some of the problems
that
may come up include recorded judgments,
child support payments due, glitches on the credit report due to any
number of reasons both accurately and inaccurately, down payments that
have not been in the clients' bank account long enough, etc.
So
the way to make a strong offer today is to get "pre-approved".
This happens AFTER all information has been checked and verified. You
are actually APPROVED for the loan and the only loose end is the
appraisal on the property. This process takes anywhere from a few days
to a few weeks depending on your situation. It's VERY POWERFUL and a
weapon I
do recommend all my clients have in their negotiating arsenal.
2)Sell First, Then Buy
If
you have a house to sell, sell it before selecting a house to buy!
Let's
pretend that we go out looking for the perfect house for you. We find it
and you love it! Now you have to go make an offer to the seller. You
want the seller to reduce the price and wait until you sell your house.
The seller figures that's a risky deal, since he might pass up a buyer
who DOESN'T have to sell a house while he's waiting for you. So he says
OK, he'll do the contingency but it has to be a full price offer!
So
you see, you paid more for the house than you could have because of the
contingency. Now you have to sell your existing house, and in a hurry!
Otherwise you lose the dream house! So to sell quickly you might take an
offer that's lower than if you had more time.
The
bottom line is that buying before selling might cost you TENS OF
THOUSANDS of dollars.
It is
recommend that you sell first, then buy.
If you're concerned that there is not a house on the market for you,
then go on a window-shopping trip. You can identify possible houses and
locations without falling in love with a specific house. If you feel
confident after that then put your house on the market.
3)Play the Game of Nines
Before
house hunting, make a list of nine things you want in the new place.
Then make a list of the nine things you don't want.
this
is called
"NINE OF THIS AND NONE OF THAT". You can use this list as a
scorecard to rate each property that you see. The one with the biggest
score wins! This helps avoid confusion and keeps things in perspective
when you're comparing dozens of homes.
When
house hunting, keep in mind the difference between "SKIN AND
BONES". The BONES are things that cannot be changed such as the
location, view, size of lot, noise in the area, school district, and
floor plan.
The
SKIN represents easily changed surface finishes like carpet, wallpaper,
color, and window coverings.
Buy
the house with good BONES, because the SKIN can always be changed to
match your tastes.
It is
recommend that you imagine each house as if
it were vacant. Consider each house on its underlying merits, not the
seller's decorating skills.
4)Don't Be Pushed Into Any House
Your
agent should show you everything available that meets your requirements.
Don't make a decision on a house until you feel that you've seen enough
to pick the best one.
Go
to the Multiple Listing computer with your agent to make sure that you
are getting a COMPLETE list.
Now
that there is so much new construction, there are many new and resale
homes to choose from. Homes in this area still sell fairly fast so don't
take too much time in making a choice especially when a house is under
priced , price right on is in a desirable location., it wont last.
Don't
forget to check into the SCHOOL DISTRICTS of the area you're
considering. Information is available on every school; such as class
sizes, % of students that go on to college, SAT scores, etc. You can get
this information from your agent (
it's
right here on my web-site) or directly from the school.
5)Stop Calling Ads!
A
word of caution - agents create ads solely to make the phone ring! Many
of the homes have some drawback that's not mentioned in the ad, such as
traffic noise, power lines, or litigation in the community.
What's
not mentioned in the ad is usually more important than what is. For this
reason, I want you to be very careful when reading ads. Remember that
the person writing the ad is representing the seller and not you!
The
most important thing you can do is have someone on your side looking out
for your best interests. Your own agent will critique the property with
an eye towards how well it meets your needs and will point out any
drawbacks you should know about.
So
whether you decide to work with me or not, pick an agent you feel
comfortable with and enlist the services of that agent as a buyer's
broker. Then you become a client with all the rights, benefits, and
privileges created by this agency relationship, and you're no longer
just a shopper.
Did
you know that many homes are sold WITHOUT A SIGN ever going up or an AD
EVER BEING PUT IN THE PAPER? These "great deals" go to those
people who are committed to working with one agent. When an agent hears
of a great buy, who do you think he's going to call? His client, who he
has a legal obligation to work hard for, or someone who just called on
the phone and said "keep your eyes open"? So to get the best
buy on a property, It is recommend that you hire your own agent and
stick with him. Since the buyer typically don't pay the real estate
fees, it really is a no-brainer!
