Is your real estate buyer’s agent doing a good job?
I have met and experienced many many real estate agents. Some agents are good agents who are hardworking and efficient. For those good agents I have come across, I have nothing but respect as a fellow professional in the industry. Some others… well not so much. What makes a good buyer’s agent for buyer clients? That question is sometimes best answered by a listing agent. If you are a listing agent, you will receive 10-15 offers in average in this seller’s market. Some homes go over $20,000 over the listing price. We all hear that story. In those cases, the offer with the highest price wins the bid. Many modest homes with a reasonable listing price, however, often have less than 10 offers all within the price range of $5,000. When the price range is not as big, other qualities of offers become deciding factors as to who the seller will choose.
Communication with the seller’s agent
A good buyer’s agent asks a lot of questions to the seller’s agent. Being an informed buyer is very important for the seller to take your offer seriously. Asking a lot of questions also can also help the buyer’s agent understand the level of competition and when to submit the offer. Unlike bidding on something on Ebay, putting an offer on a house seems like you’re throwing a rock in the dark. In today’s seller’s market where we have multiple offers, how do you know if your offer is competitive enough? Talk to the seller’s agent. The agent will be reluctant to give you detailed information that can hurt the seller because he or she has a fiduciary duty to the home seller but will give you some idea as to what is going on with offers and the deadline for the seller to make the decision.
When you receive an offer, and it has missing information such as check marks, needed addendum, or a mortgage pre-approval letter, it raises a red flat to the listing agent. The agent will think the buyer agent is so sloppy that he or she will have to end up doing all the work pushing through the transaction. This happens a lot and when there is another offer that is just as competitive or slightly less, the listing agent’s opinion of the sloppy offer can persuade the seller not to accept the offer. Also, some deals have a specific instruction as to how to make offers. Often it is the case for REO properties. Ignoring the instruction will hurt you or delay the deal.
Weak mortgage pre-approval letter
Some lenders provide pre-approval letters like free candies in a jar. Some pre-approval letters are more like pre-qualification letters where you can get one as long as you verbally tell them you make this amount of income. Who wants to rely on that sloppy financing commitment letter when selling their home? I wouldn’t. Stronger the pre-approval letter from the lender showing detailed information, the better because the seller then understands that this buyer won’t likely back out because of his or her financing fails after the contract is signed. I work with a mortgage company that provides underwritten pre-approval upfront within six hours of application. My buyer clients who submit an underwritten pre-approval letter from the mortgage company will have an edge over other offers with what appears to be a weak message as to the ability of the buyer financing the deal. Some lenders are just better and faster and can close much quicker. The lender I work with can close within 20-22 days since the contract is signed. Once the financing process takes long enough, it will delay the process and the seller can back out. Many deals have 30 day financing contingency removal and if the buyer’s loan company takes more than 30 days, the seller has the right to back out and find another able buyer rather than signing an extension addendum. Sellers need the money quickly so they can start looking for a place to buy too.