Would You Be Offended?

[capecodcathy]

I find the comments about the pre-approval letter to be somewhat strange. I don't think I have ever attached a pre-approval letter to an offer. What the Buyer is approved for is not indicative of what they can actually afford or are willing to pay. I got an approval once for 250K (10 years ago) and bought my house at $160K. There was no way I could afford what I was approved for! Maybe we work differently in my area (much smaller) but a Listing Agent assumes that the Buyer Agent has a preapproval and is making sure the Buyer is looking in the appropriate price range. I've never had an LA ask me how much the Buyer was approved for. That's none of their business and should be confidential between the Buyer and the Buyer Agent at least until negotiations are complete.
Why would you let a Seller know that you can "afford" more than you're offering? Am I missing something here?

[shellytc]

hey Cathy, I always expect (and will ask for it if not given with the offer) a copy of the pre-approval letter. I want to see that the buyer is actually ABLE to purchase the house they have put an offer in, and they have done the due diligence it takes to get a pre-approval (not a pre-qual), and I want to see who the lender is. If isn't a lender that is local or typical, I will even call the mortgage officer to check on the file and make sure all is good. that is when I represent the seller.

When I represent the buyer, of course we need pre-approval so we know how much to shop for, BUT when it comes time to make the offer, I will ask the lender to issue a new approval for the actual amount of the offer. It is not the sellers business to know HOW MUCH we are approved for, only that we can perform on our offer amount.

Helps with negotiation if I present my buyer as able to perform...

Shelly

[shellytc]

P.S. if it is a cash deal, I would attach a letter from the bank stating funds are available to cover the offer amount.

shelly

[Kristy Woodford]

I agree. It is common practice here in the PNW to add to the strength of your offer with a pre-approval letter (not just a pre-qual) or a letter from the bank stating sufficient funds to close on a cash deal. Even if you keep it generic and don't give the amount that the buyer is approved for, a letter is recommended. This was especially important when the market was a strong seller's market and there were multiple offers coming in on a property. It was (and is) an important element distinguishing the offer from another.

[Ozark Nana]

This is just us as sellers, but we won't even show the home unless we have proof that they pre-approve for the asking price.....I don't have the time or energy to be showing the house every single day to those that "have to sell our home", "just wanted to see it", "just getting comps" etc.....it's pointless to show to someone that doesn't have the pre-approval....we have never had an open house (waste of time and to many weirdo's).

O.Nana

[garth]

Originally Posted by Ozark Nana

This is just us as sellers, but we won't even show the home unless we have proof that they pre-approve for the asking price

Just a question because I don't really understand how you do this. Are you saying that prospective buyers have to provide a preapproval letter showing the total price of your house, even before they have made an offer and are just seeing it for the first time? If the pre-approval is for a lesser amount, which is normal, do you also need to see their bank statement to amount to the total sales price of the home? That just seems a bit onerous and may have other negative implications.

Personally, I see it as the job of the buyer's Realtor to ensure, to some degree, that their clients are qualified before showing a house. To provide you with the info you've requsted before we've entered into negotiations or a contract is filled with problems.

Here's another perspective. A buyer doesn't know who you are. You could be an identity thief for all the buyer knows. For example, I, as the buyer, will not provide you with any information not needed because I don't know how you're going to use it. I simply don't throw information like that around with abandon, and that's what it would be at that point . . . with abandon. It's simply none of your business unless we try to enter into a transaction, and even at that time the extent of the demand is beyond necessary.

In fact, you don't even need to know the buyer's name in a real estate transaction. Have you ever had someone buy something from you through a trust, or corporation, with the transaction handled by an attorney or corporate officer instead of the Trustee or Primary Shareholder? It happens all of the time in some markets. Neither of thos entities will ever meet such a demand at the point of initial viewing.

The information you've requested, at that point, also gives you an advantage in future negotiations that you are not due. What loan amount anyone has qualified for, and what amount the buyer has in the bank to reach your "asking price" qualification, is none of your business . . . at that point.

In fact, if you rejected a legitimate request for a showing of a listed property based on a refusal to provide the info you've requested, I think the issue could be presented to a venue that you and your agent would not want to enter. There may be issues that could be alleged if it were shown that such requirements were not industry standard and somehow impeded equal access to your publicly listed property. Once that whole issue is raised, even if proved untrue, it colors the property, agent, and the seller for the foreseeable future. I can't see a Realtor agreeing to being a part of such a situation.

It also makes it harder to sell your property. In this day of increased inventory, there's nothing that will make one house special. There's lots of other houses, no matter what price range is being considered. Anything that will make a buyer feel that there's something smelly going on, or that they view as unnecesary or onerous, will make them just pass the house by and head to the next one. I know I would do that.

I've also been in the same position as you every time I've sold a house, but I've understood that inconvenience is part of the process. I've depended on the desire of the professional Realtors to not waste their own time, and to therefor only bring qualified buyers. If an unqualified one slips through now and again, so what! It's just part of the process to get the house sold. That's why I've listed the house . . . to get it sold and not to put up roadblocks to that goal.

Originally Posted by Ozark Nana

we have never had an open house (waste of time and to many weirdo's).

This is absolutely true. I've never had a retail open house, either. I don't see it as anything other than a way for the nosey neighbors to get, uh, nosey, and a way for the real estate agent to gain new clients. Rare is the time when a house is sold off of an open house.

[Brandon Hoffman]

Shelly hit the nail on the head. It is customary to send a pre-qual letter in with the offer. If I'm a sellers agent and don't get the p-q letter I'll call the other agent back and make them get me a copy. When I'm the buyers agents, I take a sharpie and strike through the amount on the pq letter if the lender put it on the letter.

As far as the the inspection question, I tell my buyers they can come if they want but they are not required to be there. If the buyer does come (about 50/50) I tell them not to bother the inspector while they are working. If you follow around the HI and ask questions you could become a distraction and cause something to be missed. I have a list of 3 inspectors that I hand out and then tell the client these are ones that have provided quality work for past clients on a repeated basis but they are free to choose anyone. We normally suggest vendors because they excel at what they do. If a vendor does a bad job, it makes me look bad and I don't use them again.

Hope that helps.