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Hi, I am a lifelong renter now buying a home with my bf. Neither of us know all that much about the buying process. We found an awesome old house that needs a lot of work but is dirt cheap and IMO a great investment as well as what would be our home. We met the realtor there today, he told us it has been on the market a long time and dropped in price by almost half due to the amount of work it needs (my bf and all his friends are in the contracting/construction business so I am confident he knows what we're getting into). It is not owned by a person, but a charitable organization. The realtor said if it went any lower, an investor would buy it (it has a lot of land),
So long story short, we parted ways, my bf and I are excited and already picturing ourselves living there, I spoke in the driveway to the realtor's mortgage guy who is getting me pre-approved, all is good, right...we walked back to the car and another car was pulling in, with someone else looking at the property. We spoke for a second, and I think this was his second time going by, but I don't think he's spoken to a realtor yet. He said "good luck" when we parted...we left now upset and worried because this is a truly rare property due to location.
So what is our next step? We now feel paranoid and we feel like we need to rush, but I don't want to do anything stupid, especially as we don't know for sure that guy is really interested. So, I am pretty certain I will be approved as I have good credit and make a decent salary. When we make an offer, we are going to be very tempted to go higher due to worrying about that other guy. Should we offer the asking price, higher, what?
I know we can't count on anything, but we have a pretty low price ceiling and there is nothing else like this place in our range.
You need a Buyer's Agent, someone who represents you and can advise you properly. S/he will should also be able to tell you what a good offer is or isn't.
The listing agent works for the Sellers and looks to get the best price and terms for them.
Follow the advice of your realtor. That is what you hired them for. They know the area, the comps, and what the property is worth based on the condition.
If it is in bad shape, are you sure you can even get a loan for it? Sometimes properties in disrepair do not qualify for financing. I would ask your realtor about this.
You have absolutely no idea if the other person is really interested in the property.
Seeing that person should have taught you a valuable lesson though: don't look at houses until you've spoken to a lender. That way you can make an offer immediately with more confidence.
Honestly, when I worked as an agent, I would show people a few houses, but it was a waste of my time to do more until they spoke with a lender.
Your first step is to ask your agent to contact the seller's agent. Let them know you're interested and to inform you of any offers. Since it is a long weekend, contact and meet with a bank or mortgage broker asap next week.
You said the house needs a lot of work. More than likely, that's not going to be approved through traditional financing methods. It's not just you that has to qualify, but it's the house as well. If you have to do a rehab loan, your boyfriend and his friends cannot do the work. It has to be lender approved contractors.
You have a lot more research to do before you jump into a house like this, especially for your first house. To drop asking price in half tells me it's almost dilapidated, unless you're just exaggerating on what's needed.
Follow the advice of your realtor. That is what you hired them for. They know the area, the comps, and what the property is worth based on the condition.
If it is in bad shape, are you sure you can even get a loan for it? Sometimes properties in disrepair do not qualify for financing. I would ask your realtor about this.
He said it won't qualify for VA or FHA but shouldn't have a problem with standard financing/mortgage.
I'm not sure the realtor knows about the other guy. The realtor had gone by the time he pulled in with his daughter. They were there without a realtor just to walk the outside and he told us it was the second time he'd come to look at it. Should I say anything to anyone?
I think the realtor mostly just wants to sell it. It's been on the market over a year and is half the price it was originally and half the amount of the assessed value (due to the land). There is no seller tapping their heels waiting for a sale, it belongs to a charitable organization and I'm sure they just want to get rid of it too ( Which is probably why it's so cheap)
It just figures after all this time now 2 people might want it.
You said the house needs a lot of work. More than likely, that's not going to be approved through traditional financing methods. It's not just you that has to qualify, but it's the house as well. If you have to do a rehab loan, your boyfriend and his friends cannot do the work. It has to be lender approved contractors.
You have a lot more research to do before you jump into a house like this, especially for your first house. To drop asking price in half tells me it's almost dilapidated, unless you're just exaggerating on what's needed.
I know but it feels like once in a lifetime find. of course anything would be contingent on inspection, and my bf is going to have one of his contractor friends look at it as well.
But now that other people might be interested I feel like I'm not gonna have the luxury of time so I'm very confused and worried about it how do I handle this? What happens if the realtor calls in two days and says they made an offer?
You have absolutely no idea if the other person is really interested in the property.
Seeing that person should have taught you a valuable lesson though: don't look at houses until you've spoken to a lender. That way you can make an offer immediately with more confidence.
Honestly, when I worked as an agent, I would show people a few houses, but it was a waste of my time to do more until they spoke with a lender.
Your first step is to ask your agent to contact the seller's agent. Let them know you're interested and to inform you of any offers. Since it is a long weekend, contact and meet with a bank or mortgage broker asap next week.
Thank you I know you are right. It's hard for me to keep emotion out of things.
Put the earnest money up and get it under contract. If it's been sitting for as long as you say and the realtor says it'll probably go with a conventional loan, move NOW. Put a financing/inspection contingency in the offer as an 'out' if the deal goes bad.
Put the earnest money up and get it under contract. If it's been sitting for as long as you say and the realtor says it'll probably go with a conventional loan, move NOW. Put a financing/inspection contingency in the offer as an 'out' if the deal goes bad.
Thank you! How do we know how much to offer?
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of course anything would be contingent on inspection, and my bf is going to have one of his contractor friends look at it as well. 
