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Old 06-18-2018, 09:46 AM
 
5,917 posts, read 4,054,897 times
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Quote:
Originally Posted by emotiioo View Post
We have done that. We were selling a rental that could have been good as a starter home. We had one offer, below asking, it was a flimsy one with no down payment whatsoever, asked for closing help and came with a letter about the buyer. It was a terrible offer and the letter was overtly meant to bias us toward the offer because we were supposed to connect emotionally with the buyer. It backfired. We were selling around Christmas which is a bad time in most markets, but we were confident something better would come along. And it did, about two weeks later. We didn't for a moment worry that we would not get something better which in this case was full asking with conventional financing and 10% down, no closing assistance and (thankfully) no silly letter. We got another offer a few days after that which had a bigger down payment and faster close. We ultimately went with the third one.
I'd say in this case (we had a similar one) it took all three things (the cloying letter, the 0% down, AND the ask for $$ back toward closing) to paint a picture of a shaky buyer on a fishing expedition.
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Old 06-18-2018, 02:44 PM
 
230 posts, read 69,468 times
Reputation: 160
Quote:
Originally Posted by emotiioo View Post
We have done that. We were selling a rental that could have been good as a starter home. We had one offer, below asking, it was a flimsy one with no down payment whatsoever, asked for closing help and came with a letter about the buyer. It was a terrible offer and the letter was overtly meant to bias us toward the offer because we were supposed to connect emotionally with the buyer. It backfired. We were selling around Christmas which is a bad time in most markets, but we were confident something better would come along. And it did, about two weeks later. We didn't for a moment worry that we would not get something better which in this case was full asking with conventional financing and 10% down, no closing assistance and (thankfully) no silly letter. We got another offer a few days after that which had a bigger down payment and faster close. We ultimately went with the third one.
We looked for houses about 150k less than what our pre approval letter stated. We had SELLERS who would write us letters when they countered about buying in 07-08 when the market was peaking, needing 1500-7000k higher than we were offering to break even and desperate to move for X (another child=needing more bedrooms, moving to be closer to work) reasons. I didn’t consider them silly letters, but people trying to explain their position. Adding a few grand to my mortgage wouldn’t be a big deal. So why shouldn’t they at least let us know and try to get more? Worst thing response would be no.

You seem really preoccupied with seller’s finances. Unless you’re the CEO of Bank of America or chase, you shouldn’t be.
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Old 06-18-2018, 03:40 PM
 
Location: Raleigh NC
7,736 posts, read 6,110,007 times
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Quote:
Originally Posted by emotiioo View Post
We have done that. We were selling a rental that could have been good as a starter home. We had one offer, below asking, it was a flimsy one with no down payment whatsoever, asked for closing help and came with a letter about the buyer. It was a terrible offer and the letter was overtly meant to bias us toward the offer because we were supposed to connect emotionally with the buyer. It backfired. We were selling around Christmas which is a bad time in most markets, but we were confident something better would come along. And it did, about two weeks later. We didn't for a moment worry that we would not get something better which in this case was full asking with conventional financing and 10% down, no closing assistance and (thankfully) no silly letter. We got another offer a few days after that which had a bigger down payment and faster close. We ultimately went with the third one.
I bet buyer #2 was real happy with you sitting on their full price offer and conventional financing.
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Old 06-18-2018, 03:48 PM
 
1,764 posts, read 866,602 times
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Quote:
Originally Posted by BoBromhal View Post
I bet buyer #2 was real happy with you sitting on their full price offer and conventional financing.
They only put 10% down...

In our world, cash is king. If no cash, we are happy to consider the offers we get through the lens of the highest down payment/no other asks for cash assistance/fastest close/most normal financing in rank order.
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Old 06-18-2018, 03:54 PM
 
230 posts, read 69,468 times
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Quote:
Originally Posted by BoBromhal View Post
I bet buyer #2 was real happy with you sitting on their full price offer and conventional financing.
I don’t blame anyone for sitting on an offer per se.. Sellers should’ve given a 24-48 window to accept or counter. That’s what we did and then withdrew offer.
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Old 06-19-2018, 01:00 AM
 
Location: San Francisco Bay Area
4,150 posts, read 2,157,557 times
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Quote:
Originally Posted by lae60 View Post
Personally when considering a cash offer and selling to a vet for the same price, I sold to the vet every single time, even taking thousand or two less one time. I feel that they earned every benefit they get. And its a better way of saying thank you for your service..
As a prospective seller, I would be happy to do that. It's the way we shop, i.e. we buy everything we possibly can at our locally-owned ACE hardware store. It costs more, but the help we get on an ongoing basis makes it well worth it to us. I did my best to help out local bookstores, buying frequently and always locally, never Amazon. Ultimately all but one of the large somewhat-local new book bookstores closed anyway.

I would help out a vet if it didn't mean I would suffer significantly financially.

However, the real estate market here is likely well beyond the reach of the VA buyer. Houses are not going to appraise for anywhere near the premium overbids that are offered in this hot market. Foreign buyers are literally throwing money at sellers. Two days ago the listing agent at an Open House in my area (which is a pleasant area, but not a luxury market) said that one of her recent buyers never even toured the property he purchased with her help. She's Chinese and so was her buyer. He stayed in China and signed everything electronically. He had used her once in the past and trusted her judgment and wanted a certain desirable property and was prepared to pay whatever it took to get it if she thought it was a good place to buy.

Buyers are given a specific date and time when their offers are to be presented. (I have even seen the phrase "Offers DUE by xx time on xx date, 2018" used, which sounds brazen to me). Since Disclosure packages are usually made available online ahead of presentation time, or sometimes are in a binder at an Open House, buyers are expected to sign off that they have read everything and agreed to waiving most, if not all repairs, of items found to be deficient during the inspections ordered by the seller/agent before it was put on the market. Every offer is an overbid, and some recent overbids I have seen here have been 20% above list price, and the list prices are continuing to go up. It is beyond crazy, but it will sure help my comps.

Lest I sound like a gleeful seller, keep in mind I have to buy something, too, unless we decide to rent.

I would really like to buy a move-up home in my area, but I realize that is not likely to happen unless we get true tax basis portability and I will have to leave the inner SF Bay Area to find a bigger house in an area that I like a little less. Every prediction that housing prices would cool off by now were way off the mark.

Last edited by SFBayBoomer; 06-19-2018 at 01:26 AM..
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Old 06-19-2018, 10:55 AM
 
Location: All Over
3,971 posts, read 4,193,378 times
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I know most sellers would rather take a conventional loan offer over FHA, to my knowledge there's no conventional offers that will give 0% down. I would say someone not putting any money down is more likley to ask for closing costs to be paid as well. Also on the offchance house is a few grand short of appraising they likely don't have the funds to make up the difference where potentially someone else would be willing to. To me it's a bit of a red flag if someone can't put 5% or 10% down.
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Old 06-19-2018, 11:06 AM
 
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I think you're misunderstanding how a VA loan works. You don't get asked to pay the closing costs out of pocket, VA loans allow for closing costs to be ROLLED INTO the loan. I.E. you sell your house for $100,000 and $5,000 in closing costs, the buyer takes a $105,000 loan. That $5,000 doesn't come out of your cut unless you and the buyer negotiate it to be so.


If you had to put $8,000 into your home to make the deal go through, I'd bet it had some non-negligible problems that had to be resolved. I've bought a home with a VA loan and it appraised with no problems.


Quote:
Originally Posted by Lockdev View Post
I once sold to someone putting 0 down.

Turns out he had a VA loan.

He asked me to pay closing and the appraisal was a nightmare. Ended up putting around 8k into the house to make the deal go through.

All things being equal, or within a few thousand, choose a buyer with a more conventional loan. The 0 down buyer isn't worth the trouble if you have other people lined up.
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Old 06-19-2018, 12:44 PM
 
570 posts, read 221,565 times
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Quote:
Originally Posted by doodlemagic View Post
I know most sellers would rather take a conventional loan offer over FHA, to my knowledge there's no conventional offers that will give 0% down. I would say someone not putting any money down is more likley to ask for closing costs to be paid as well. Also on the offchance house is a few grand short of appraising they likely don't have the funds to make up the difference where potentially someone else would be willing to. To me it's a bit of a red flag if someone can't put 5% or 10% down.
I have a conventional loan through my credit union and was able to finance up to 100%. Because my market was competitive for homes in our desired location, we did not ask for closing costs along with our offers. We made several offers before we got one accepted but I believe it was because the hot market where people were offering more than comps and/or estimated appraised value because looking at what those other homes sold for, we would not have been able to beat those offers.

We ultimately ended up getting a few thousand off the home we offered on in lieu of some repairs that the seller preferred not to make because they had already moved out of state and did not want to deal with finding a contractor and/or inspecting the work. We also had made an offer less than asking price (more in line with recent comps) so we were hesitant to ask for much more because we were already getting the deal we wanted.

I suspect most people who want closing costs are going to ask for those with the initial offer and you can definitely make an assessment if you get an offer that is asking for the all the closing cost and the kitchen sink. In those cases, I can see why people would skip over those offers if they got others at full price asking for nothing.

When we sold our last house, we had several cash offers but they were several thousand lower than the financed offer with lots of due diligence and earnest money that we ultimately accepted. We figured if repair negotiations didn't go well, a cash buyer/investor would not mind walking away from a couple thousand to get out of the contract where our buyers were much more invested in the process due to the amount of money put down.

For those who steer clear of 100% financed offers - would it make a difference to you if those folks were offering up more earnest and/or due diligence money at the beginning to show they had more skin in the game?
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Old 06-20-2018, 07:19 AM
 
193 posts, read 76,547 times
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Quote:
Originally Posted by luckeeesmom View Post

For those who steer clear of 100% financed offers - would it make a difference to you if those folks were offering up more earnest and/or due diligence money at the beginning to show they had more skin in the game?
I asked my husband, who this thread is basically about, and he said "No-- they should make an offer with a decent down payment or cash, not ask for any "help" with other costs and offer up the earnest money we are asking for or more." He sees all of these elements as instrumental for a "serious and viable" offer that he would take the time to consider. So that's him. Don't know about others.

Agree about letters from buyers with another poster. We never read them if they come with an offer. We only look at the bottom line.
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