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Old 01-26-2008, 11:20 PM
 
Location: Folsom, ca
52 posts, read 264,300 times
Reputation: 31

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We are looking into buying a house that the owners seem reluctant to neonate on even though their realtor is trying to help them understand that the market is low right now. They have completely moved into the next town and have a home sitting there doing nothing but they donít seem ready to lower the price any more.

Our Realtor suggested writing a letter of interest to them but I donít even know where to begin, has anyone done this successfully? And can anyone help? We really like this home but need the owners to drop another $50K. We donít want to insult them but there is no way we can pay what they are asking. Incidentally the house has been on the market for about 80 days.
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Old 01-26-2008, 11:34 PM
 
14,199 posts, read 26,341,715 times
Reputation: 8357
Depending on the circumstances it can really work. The idea is to establish some type of bond or relationship with the seller. You can tell the seller about your family, what makes this house or neighborhood special and enclose a family picture. I know one family that was able to make a purchase only because the seller was ex Navy and the buyer was a young married Navy couple.

In 2005, when the market was red hot, I advised another young couple I know with 2 year old twins to travel to the next town to meet with the widow regarding a property she had for sale.

My thought was this young couple had been out bid numerous times and all the sellers ever had to go on was the written offers that came in.

My young friends really hit it off with the widow and she was just crazy about twins since she was also a twin.

The couple was able to buy the home with the widow carrying the first mortgage.

It's been 3 years and it has worked out very well. The couple got a substantial credit for termite repairs and roof work and the widow did not have to have the work done so it was a win/win.
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Old 01-27-2008, 09:31 AM
 
Location: Folsom, ca
52 posts, read 264,300 times
Reputation: 31
Thank you, for the advice.

I was hoping that someone also might have an example of a Successful letter. I tried but our realtor only liked the first part.

Any more advice or critiques’ would be helpful

Dear Home Owner,

My wife, two children and I have visited your home
twice now and are extremely impressed with how beautiful your home is
and admire both your hard work and vision in regard to the entire
property.

I hope that you do not find our offer offending but rather that you
understand that we are stretching our means to the limit to offer you
as much as we are able to. Currently we reside in the Bay Area and
are in a neighborhood that is not conducive to our family.

Unfortunately we have found ourselves in a situation where we can not
afford to move into a better environment in this area. The sad reality,
of our situation is that we have done everything possible to be good
people and it seems like our good intentions are preventing us from
the good things. We have made sacrifices to ensure that are children
are growing up to be good people. My wife has given up her career so
our children would not need to attend daycare, we believe it is our
responsibility to raise our children. I took a job in health care
(Information Technology), so that at the end of the day when I go home
I know that I've done something that may have helped the health and
wellbeing of someone. Sadly, there is no intrinsic value placed on
doing the right thing and living responsible lives.

So after searching all over the Bay Area, Oregon, Washington and
Colorado; for affordable housing in a great neighborhood, with
fantastic schools and low crime we have come to the conclusion that
your city is everything we have dreamed of and heartbreakingly we my
fall short of our dreams by a few thousand dollars.

Sincerely yours,
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Old 01-27-2008, 11:01 AM
 
14,199 posts, read 26,341,715 times
Reputation: 8357
It's all about positive first impressions and not giving the impression you're over extended or desperate.

Maybe a little more emphasis on creating a positive tone will give you a better chance of success.

Try making your letter personal by using the owner's name and write the letter as you would to a respected elder.

Just make it short... no more than one page, upbeat, maybe a family picture and leave out any negatives.

Have you spoken with any of the neighbors? Often neighbors are a great wealth of information and may have a lot of influence with the owners... it has worked in my favor several times.

I'm surprised that your Realtor isn't being more helpful?

Positive Points from your Letter in no particular order...

Family, Working in Health Care, Stay Home Mom, Looking for the Long Term, Involved with the Community, Wife has put her Career on Hold for our Family, Would like to Stay in the Bay Area, PreQualified or PreApproved for "X" Amount, Looking to Put Down Roots, Wife and Children Say this is the One...

Remember... Positive, not Desperate and try to Bond in someway with the Seller. It can really help if the Sellers can see a little of themselves in you and your family.

Selling a home can be very emotional... even more than buying.
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Old 01-28-2008, 06:00 PM
Status: "It's 5 o'clock somewhere." (set 23 days ago)
 
Location: Mountain Ranch, CA The heart of Calaveras County
6,175 posts, read 11,595,668 times
Reputation: 4950
Maybe it's just the old guy in me or maybe the OP didn't strike a chord with me, but I don't think your motivation should be an issue in the purchase of a home. You have to be ready, willing and ABLE to buy a home. If you're 50K short, you're just not qualified to buy the home.

It's a very nice letter you wrote, but if I were advising the seller, I'd ask them if it was worth 50K to them. I think your best bet is to wait the sellers out. you didn't say what the asking price was or how much 50K represents out of the original price. When I read "another 50K" I'm wondering if they've already made a big price reduction.

Also, 80 days on the market isn't that long these days, 140 might be more like it.

I hope it works for you, I really do, but I wouldn't want you to pin your hopes on it.
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Old 01-28-2008, 08:20 PM
 
Location: Calgary, AB
315 posts, read 1,088,690 times
Reputation: 127
I am being completely serious when I type....FIRE YOUR REALTOR! If he/she can't help you type a real estate related letter of interest, there is no telling how many other areas they will fall short. With that said, I personally think a letter of interest is worthless compared to a written offer with a mortgage guarantee letter and a $25K ckeck for a deposit.

Keep in mind what the seller wants out of a buyer. It is pretty simple. Sellers want the following:
  • Highest price the market will bear
  • Well qualified buyer (little chance the deal will fall through)
  • Fast closing (if house is empty)
Don't let the seller know you are in love with the house because they will have little incentive to lower their price.

Don't let the seller know you are stretching the limits of your mortgage approval.

Don't downplay the difference between the asking price and your offer price. After all, if it was only a little money, you would just offer full price.

Do write a strong offer with all your ducks in a row.

Do leave a substantial deposit to show you are serious.

Do provide a logial basis for your offer price. Your personal circumstances mean nothing in the pricing of real estate.
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Old 01-29-2008, 02:20 PM
 
14,199 posts, read 26,341,715 times
Reputation: 8357
Default Contacting the Seller has worked for me.

My "Letter of Interest" and meeting with the Seller allowed me to offer full price, less the Seller's advertised credit for Termite Work, because the Seller Agreed to Carry Back a First Deed of Trust at a very modest interest rate.

She was moving out of her home of 47 years to live with her Daughter several States away. The property had been marketed as all cash to the Seller.

I was able to get a great 15 year fixed rate loan, without having to pay any points and associated loan fees. I was also to apply the termite credit to improvements that I wanted to make on my own schedule since a Termite Clearance was not a condition to fund.

The Seller was able to sell at her asking price and did not have to deal with any repairs. She received my 20% down payment to cover her Realtor's Commission, her Relocation Costs and still have a nice Nest Egg AND she had set up an Income Stream based on my monthly Mortgage Payment.

None of this would have happened if I hadn't contacted the Seller...

Last edited by Ultrarunner; 09-07-2011 at 02:51 PM..
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