Home Buying Tips

Posted by Joe Bartolotta, Florida's Upfront Mortgage Broker
September 19, 2007

Home buying tips that will make you view the home buying process through the eyes of the seller.

If you were the seller of a home and received two identical offers, which one would you take? With everything being equal, most sellers would probably accept the offer with the strongest pre-qualification letter from a reputable lender.

Understanding what an experienced home seller, and his/her agent, will be looking for during a negotiation puts you in position to control the negotiations. In today's market, home sellers will be looking for several items on your pre-qualification letter:

• Proof of down payment and closing costs, the seller and their agent want to make sure you do not need to sell your existing home in order to purchase this one.
• Sellers will look for a clause from the lender that says approved, subject to appraisal only. This shows that the buyer has taken the time to apply for a mortgage and get their loan underwritten by their lender and is a viable buyer, using a smart lender.
• Don't let your lender's letter counteract your negotiations. You should require your lender to prepare two or three pre-qualification letters. Why you ask? Let's say you find a home listed at $350,000. After speaking to your Realtor and reviewing comparable sales in the neighborhood you feel the value is no more than $325,000. You decide to offer $300,000. If your pre-qualification letter shows you can afford up to $350,000, you just potentially negotiated against yourself. An savvy seller and their agent will know you can afford more. Have your lender write your letter to match your offer and not a dollar more. Also, have them write one for $325,000 to use if a counter-offer is needed.

Customize the numbers to your deal and you will get the home at your price.