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Old 04-11-2011, 03:23 PM
 
64 posts, read 336,158 times
Reputation: 55

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Quote:
Originally Posted by QuilterChick View Post
Please listen carefully:

The SELLER IS NOT TOLD ANY AMOUNT THAT YOU ARE QUALIFIED TO BUY A PARTICULAR HOME FOR.

THE SELLER IS NOT TOLD ANY AMOUNT OF THE BUYERS FINANCIAL STATUS.

THE BUYER'S AGENT IS THE ONLY ONE WHO NEEDS TO KNOW THAT THE BUYERS ARE QUALIFIED, AND THE SELLING AGENT HAS TO KNOW THE BUYERS ARE QUALIFIED BEFORE PRESENTING AN OFFER. THE BUYERS AGENT GIVES NO MAX FIGURE AMOUNT TO THE SELLING AGENT. IT IS AGAINST THE LAW FOR A BUYERS AGENT TO DO SO.

IT'S CALLED FIDUCIARY DUTY TO NOT REVEAL THE FINANCES OF THE BUYER, ONLY THAT HE HAS BEEN PRE QUALIFIED BY A BANK OR THE REALTOR.

BELIEVE IT OR NOT, REALTORS KNOW HOW TO QUALIFY A BUYER. AND A BANK CAN GIVE THE BUYER A LETTER OR PRE QUALIFY A BUYER EVEN BEFORE HE HIRES A REALTOR.

Lawdy lawdy, this topic has been beaten up to shreds.
Well apparently the listing agent and the buyer's agent in this case don't know the law. Because my agent called me and told me what they were requiring, the pre-approval letter with amount either faxed or e-mailed to the listing agent before they would allow the house to be shown and wanted to know if I wanted to still see the house as he would need me to sign a waiver giving him permission to send the information. I of course said no and he agreed and was going to advise me against it if I had said yes. He's been in the business for a long time, so I'm sure he knows the law and is why he said he'd need me to give him permission to send it. He also said this was the first he had ever seen where they were requiring an approval amount and had only seen a few where they required an approval letter at all and that in most cases if an agent has a seller worried about it they're fine with the agent asking the buyer's agent if the buyer is pre-approved. Even then he said that's like 1% of houses on the market where the seller is requiring any kind of pre-approval before showing the house.
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Old 04-11-2011, 03:39 PM
 
11,113 posts, read 19,412,933 times
Reputation: 10172
Quote:
Originally Posted by okhomebuyer View Post
Well apparently the listing agent and the buyer's agent in this case don't know the law. Because my agent called me and told me what they were requiring, the pre-approval letter with amount either faxed or e-mailed to the listing agent before they would allow the house to be shown and wanted to know if I wanted to still see the house as he would need me to sign a waiver giving him permission to send the information. I of course said no and he agreed and was going to advise me against it if I had said yes. He's been in the business for a long time, so I'm sure he knows the law and is why he said he'd need me to give him permission to send it. He also said this was the first he had ever seen where they were requiring an approval amount and had only seen a few where they required an approval letter at all and that in most cases if an agent has a seller worried about it they're fine with the agent asking the buyer's agent if the buyer is pre-approved. Even then he said that's like 1% of houses on the market where the seller is requiring any kind of pre-approval before showing the house.
Please see the definition of fiduciary duty as it relates to real estate:

Definition of Fiduciary in Real Estate

You can delve further into reseacrh about it, but the above pretty much covers it.

It must be very difficult to sell property where you are located; granted every state has different laws. But fiduciary duty is a legal duty in every state in the U.S. If the seller had to physically see what every potential buyer who makes an appointment to see his house is qualified for, who would even have the time to go back and forth with this ridiculous dance. Breach of fiduciary duty is serious.

As has been said before, many buyers can afford millions, doesn't mean they want to spend it. They may not even want to spend $200K.

Check with your local Board or Realtors, your situation is odd, and it's a wonder anything gets sold there, wherever "there" is.
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Old 04-11-2011, 07:04 PM
 
64 posts, read 336,158 times
Reputation: 55
Quote:
Originally Posted by QuilterChick View Post
Please see the definition of fiduciary duty as it relates to real estate:

Definition of Fiduciary in Real Estate

You can delve further into reseacrh about it, but the above pretty much covers it.

It must be very difficult to sell property where you are located; granted every state has different laws. But fiduciary duty is a legal duty in every state in the U.S. If the seller had to physically see what every potential buyer who makes an appointment to see his house is qualified for, who would even have the time to go back and forth with this ridiculous dance. Breach of fiduciary duty is serious.

As has been said before, many buyers can afford millions, doesn't mean they want to spend it. They may not even want to spend $200K.

Check with your local Board or Realtors, your situation is odd, and it's a wonder anything gets sold there, wherever "there" is.
Like I said it apparently is not the norm but apparently can be done if the buyer agrees to sign a waiver giving the agent permission to release this information. Like I said he told me in order for him to release the info, he had to have a signed agreement from me. So I would assume that releases him from breaking any laws. I didn't see the agreement because I thought it sounded crazy and it wasn't something I was willing to do.
He also said he told the listing agent good luck ever selling that house.

My opinion as a seller and as a buyer is if you want to sell a home you need to make it easier for agents to show your house not harder. From looking at tax records there is not a lot being sold in any of the three counties I'm looking in. From what I've been told there are not many buyers looking. So sellers putting obstacles such as demanding pre-approvals before showing their house or putting time restraints on when they can be showed or not keeping their house clean or wanting to be there when their house is being shown is not helping their listing agent to sell their home.

I have a pre-approval and I do know when I made the one offer I made I had to sign a paper giving my agent permission to send my pre-approval letter with the offer. I can't remember exactly what it said something like I understood the seller requires a pre-approval with all offers and I give X acting as my agent to include this with my offer or something similar. It didn't include the amount which would not have mattered because our lender asked us and my agent if we wanted it left open or wanted him to include a certain amount. We told him to leave it open, but he would have put any amount up to our max in the letter. So I'm assuming if we had really wanted to see the other house we could have done the same thing, just had him to put the list price or slightly less.
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Old 04-12-2011, 11:38 AM
 
1,096 posts, read 4,514,033 times
Reputation: 1097
Quote:
Originally Posted by meh_whatever View Post
No... it does. Your example was too broad.

Let's say that you are selling your house for 515k.

Buyer is prequalified for 600k.

Why would you be at all motivated to lower your price if you know the buyer is more than qualified to buy a more expensive home?

Now... if you could see the buyer had a prequal for 505k, and you were selling for 515k, would you be more inclined to attempt to help them buy your home? Especially if you hadn't had a lot of offers and your house had been languishing on the market for months?

I say yes.

Soo... there ya go.

If you have the first buyer, you might want to play hard ball, even though you're highly motivated, because after all, you think your house is worth 515k, and you know they can afford it.

I have a 5k limit on my credit card. When I go to best buy to buy a new flat screen why don't they up the price from $500 to $5000 b/c $5000 is what I could potentially spend.

Lots of people woud rather have a nicely decorated house, cars, toys, trips than a big empty home so many people buy homes well below what they can afford.

I just don't get why people think someone prequal for more means they will pay more.

ONe has NOTHING to do with the other.What I'm prequalified for has absolutely NOTHING to do with the value of your home
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Old 04-12-2011, 11:44 AM
 
Location: My House
34,935 posts, read 36,062,311 times
Reputation: 26535
Quote:
Originally Posted by rfr69 View Post
I have a 5k limit on my credit card. When I go to best buy to buy a new flat screen why don't they up the price from $500 to $5000 b/c $5000 is what I could potentially spend.

Lots of people woud rather have a nicely decorated house, cars, toys, trips than a big empty home so many people buy homes well below what they can afford.

I just don't get why people think someone prequal for more means they will pay more.

ONe has NOTHING to do with the other.What I'm prequalified for has absolutely NOTHING to do with the value of your home
Trust me... if you go to say, a furniture store and do in-house financing, and they know you were approved for 25k, they'll try to sell you 25k in furniture.

They're not gonna raise the prices, but they sure won't go and lower all of them, either.

I just don't think it's anyone's business how much house I can or cannot qualify to purchase. As others have mentioned here, there's a lot that isn't on a piece of paper, such as gift funds, money you have saved in the bank, etc.

I'd like to have blind negotiations with the seller. If my realtor reassures the seller's realtor that I'm in a position to purchase the home, that should be adequate.
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Old 04-12-2011, 12:05 PM
 
Location: ABQ
3,771 posts, read 7,057,343 times
Reputation: 4893
Quote:
Originally Posted by meh_whatever View Post
I just don't think it's anyone's business how much house I can or cannot qualify to purchase. As others have mentioned here, there's a lot that isn't on a piece of paper, such as gift funds, money you have saved in the bank, etc.

I'd like to have blind negotiations with the seller. If my realtor reassures the seller's realtor that I'm in a position to purchase the home, that should be adequate.
More misinformation

1. The seller doesn't need to know how much you're qualified FOR, only that you're qualified to see their house. Simply have the lender make up multiple papers for you in multiple price points. Takes 2 minutes.

2. I assume you don't live in a competitive market. In competitive markets, NO sellers (unless maybe the house has been on the market for a long time without any bites) are going to take their home off the market without a pre-approval letter from the lender included with the contract offer.

If you're saying that you understand this but don't wish to furnish your realtor with the letter for fear that he's going to tell the seller exactly what you're qualified for, or you don't wish for him to know at all for fear that he's going to push you into a higher price point, then there's no reasoning I'll be able to give why your realtor doesn't care except to know he's not wasting his time. In those cases, don't use a realtor. Go get licensed, join your local board, and negotiate all of your own deals.
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Old 04-12-2011, 12:39 PM
 
Location: Up above the world so high!
45,218 posts, read 100,302,796 times
Reputation: 40194
Quote:
Originally Posted by meh_whatever View Post
Trust me... if you go to say, a furniture store and do in-house financing, and they know you were approved for 25k, they'll try to sell you 25k in furniture.

They're not gonna raise the prices, but they sure won't go and lower all of them, either.

I just don't think it's anyone's business how much house I can or cannot qualify to purchase. As others have mentioned here, there's a lot that isn't on a piece of paper, such as gift funds, money you have saved in the bank, etc.

I'd like to have blind negotiations with the seller. If my realtor reassures the seller's realtor that I'm in a position to purchase the home, that should be adequate.
I think you are misunderstanding...the realtor does not need to know or even care to know what limit you are qualified up to.

They just need reassurance that you ARE indeed qualified to be looking at homes in a certain range so they aren't wasting their time or the sellers time.

This ain't rocket science, just good time management!
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Old 04-12-2011, 12:44 PM
 
Location: My House
34,935 posts, read 36,062,311 times
Reputation: 26535
Quote:
Originally Posted by Parti Rhinocéros View Post
More misinformation

1. The seller doesn't need to know how much you're qualified FOR, only that you're qualified to see their house. Simply have the lender make up multiple papers for you in multiple price points. Takes 2 minutes.

2. I assume you don't live in a competitive market. In competitive markets, NO sellers (unless maybe the house has been on the market for a long time without any bites) are going to take their home off the market without a pre-approval letter from the lender included with the contract offer.

If you're saying that you understand this but don't wish to furnish your realtor with the letter for fear that he's going to tell the seller exactly what you're qualified for, or you don't wish for him to know at all for fear that he's going to push you into a higher price point, then there's no reasoning I'll be able to give why your realtor doesn't care except to know he's not wasting his time. In those cases, don't use a realtor. Go get licensed, join your local board, and negotiate all of your own deals.
Huh?

My realtor knows what we are prequalified for. I just think that a seller's realtor should assume that my realtor knows I'm capable of purchasing a home that I'm viewing. Otherwise, why would my agent show it to me?

It's pretty competitive here. I live in Cary, NC.

If we find a house we want, we've got a local (reputable) broker who can run a basic preapproval for us with same day turnaround.

Since we don't have to buy A house, and are waiting for the RIGHT house, we've not gotten a credit pull to ding ourselves. That's stupid.

We know our scores, we know what we owe, and our lender's requirements.

I was merely responding to the poster here who refused to provide specific financials to the seller's agent to VIEW a house.

I'd do the same, unless I was shopping for a castle.
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Old 04-12-2011, 01:28 PM
 
Location: ABQ
3,771 posts, read 7,057,343 times
Reputation: 4893
Quote:
Originally Posted by meh_whatever View Post
Huh?

My realtor knows what we are prequalified for. I just think that a seller's realtor should assume that my realtor knows I'm capable of purchasing a home that I'm viewing.
Ah, I see why my post confused you.

Earlier in the thread, the topic sort of switched a bit because some people didn't think buyer's agents should prequalify or request that their buyer's talk to their lenders before the process of looking at houses began.

Unfortunately, many inexperienced realtors don't actually know that their clients are capable of actually purchasing the home in the price point that they're looking at, which is why some seller's and their agents are requesting proof.

It's unfortunate all around, really.
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Old 04-12-2011, 01:36 PM
 
Location: Texas
44,257 posts, read 64,051,768 times
Reputation: 73913
Quote:
Originally Posted by Parti Rhinocéros View Post

2. I assume you don't live in a competitive market. In competitive markets, NO sellers (unless maybe the house has been on the market for a long time without any bites) are going to take their home off the market without a pre-approval letter from the lender included with the contract offer.

.
No...this makes perfect sense in *any* market. Sellers shouldn't have to waste their time in contract negotiations with someone who can't buy the house. Though even a fancy letter can still mean the deal fall through because the realities of buyer financing.

This is the time that the lender should send a letter of the exact offer price the buyer is presenting (not how much the buyer is capable of spending).

In the end, though, no letter from anyone protects anybody from a bad deal or truly unqualified buyers.

If I am supposed to put my blind faith in a stranger to negotiate aggressively on my behalf despite the fact that he/she will make more money if I spend more money, then you're just going to have to have faith that I'm not lying to you about my finances.
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