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Insider Tips for Making An Offer On A House
If you are thinking about making an offer on a house, there are many aspects beyond price to consider in your offer. First of all, make sure you have hired the very best Sacramento Realtor you can find with decades of experience. An experienced Realtor is going to know the finite details and there are so many.
The price, of course, is very important. So many buyers only focus on the list price and it can be way under market or way overpriced. Our Code of Ethics suggest we do a comparative market analysis every time we write an offer. I certainly do. Not every agent specializes in listings nor have they listed hundreds properties, which makes pricing property a pure art form. So many aspects, I could write a short story just on pricing!
As the buyer, if you are obtaining a loan always make sure you have your loan letter is attached to your offer. Hopefully, you have been ran through lender automated direct underwriting. Additionally, as we are talking about attachments, have your proof of downpayment and closing costs in your name and dated in current month, always provide those to your agent.
Write a letter to the seller about why you love this home so much. Talk about celebrations you will have there and how much you love a few particular features. Don’t underestimate the power of letters. My own house had 10 offers and the seller chose an offer, due to a letter. And the seller was an agent, me.
The costs of sale in the purchase agreement are important. Always a good idea to split the costs or, in seller’s markets, pay entirely for title and escrow. The transfer taxes and home warranty can also be split 50/50. The natural disclosure company should always be noted, we use Property ID for $99. Try not to ask for personal property (lenders don’t like it) unless you expect, for example, that the washer and dryer will stay. Your good faith deposit is always important. In California, liquidated damages are 3%, so it is a good idea to have an earnest money deposit be less than 3% of the purchase price.
Time frames: always find out from the listing agent what the sellers need regarding closing date. If they want time in the house after closing, great, give them a week or two. This can win the offer for you. Schedule your close date at the first date the lender says they can close escrow. Shorten time for inspections and appraisal contingencies. In some instances, you can remove the appraisal contingency upfront.
Do not ask for repairs such as pest clearance or or roof repairs in your offer, which can sour the positive mood of the seller. You have an inspection time period to verify everything, so don’t ruin the day for yourself. Shorten the inspection and loan contingency dates as that will help instill seller confidence in your offer.
This does not mean you can’t ask for repairs, but it depends on what it is and how much. I usually suggest to clients that they do not ask for anything not related to safety items; for example, wiring splices and improper venting would qualify. Breakers that are not working correctly, also another safety item, a red flag. A closet door off the tracks, not so much.
There are many other items but these are a few important steps for your checklist when writing an offer on a house. Simply ask your Realtor to follow these guidelines and you will have a much better reception from the listing agent. If you want to win when you make an offer on a house, call Weintraub & Wallace Realtors today at 916-233-6957 We write offers to win!
— JaCi Wallace
Weintraub & Wallace
Does a Sacramento Seller Need to Do Home Inspection Repairs?
Telling sellers they do not have to perform home inspection repairs can fall on deaf ears.
When I send home inspection repairs and findings to a seller, it is for the seller’s records only. I tell them this. But still, some home sellers react in unexpected ways. Some sellers take the home inspection very personally. They want to call the home inspector and chew off his ear. (For some reason, more men than women opt to become a home inspector.) Sellers find the composition of the report offensive. Many don’t like the “repair” or red flags noted.
Often, these are the very sellers who tell me at the time of listing that there is nothing wrong with their home. In their mind, they have the perfectly maintained home. I chuckle to myself because I know better. But I don’t argue with them. It’s not always so much that there is a lot of stuff wrong as it is buyers may feel as though they paid all this money for a home inspection, there better be some actual discoveries. Otherwise, why did they pay $450 for nothing?
So there are home inspectors who go out of their way on the well maintained homes to find a handful of defects, regardless of how small or insignificant. A chip on the edge of a roof shingle. Water marks on the windows. Scuff marks on the screen door. Which is really amusing when you think about this. Instead of a buyer feeling relieved to discover no major problems, some buyers openly choose irritation.
Funny story to interject. When I sent a recent file of home inspection repairs to a seller, the seller thought he was supposed to fix everything. Why? I dunno. He ordered delivery of light fixtures and lined up workers. It’s a good thing he checked with me because I told him to cancel the order and the workers. He sold his home in AS IS condition. Just like every California Residential Purchase Agreement states in paragraph 11. The home is sold AS IS.
Now, one of the problems lies with buyer’s agents who don’t want to alienate buyers. So, when their buyer makes noises about not buying a home with defects, the buyer’s agent has a go to. That go to is to write a request for repair and to ask the seller to fix things. I always tell my sellers they don’t have to fix anything. Especially when receiving a petty request for repairs. Instead, I lay out the options. They can just say no and take a chance the buyer will get her knickers in a twist and cancel.
But then again, the next set of buyers won’t ask for things. Pretty much guaranteed. If it’s a substantial sum of money, we might want to sell the house again to a more reasonable buyer. I do not mind selling a home twice and getting paid once if it helps the seller. Or, the seller can agree to give the buyer a credit or renegotiate the price. Or, fix some things and not all things. It’s all negotiable. But generally, my sellers just say no. It’s their right.
A list of home inspection repairs and suggestions is for the buyer’s edification. It’s not to reopen negotiations. And I have to admit, when I work with experienced buyer’s agents on the other side of the transaction, I almost never get a request for repair for my seller. Why is that, do you think?
The Upside When FHA Buyers Cancel the Escrow
FHA buyers who cancel escrow pave the way for the next FHA buyer.
It’s doubtful that most potential home buyers start out the home buying process by thinking they will become one of those freaked out FHA buyers who might cancel the escrow, but it can happen even in markets of tight inventory more often than you would imagine. There are many reasons, none particularly substantial from an experienced listing agent’s point of view. The reasons tend to range the gamut, from unsophisticated to twisted to incorrect analyzations, but whatever the reasons the decision is right for them. Buyer’s agents do their best to manage these events; however, they are not always successful.
You can’t change the mindset of stubbornness in some people. It’s a fine walk for buyer’s agents. On the one hand, they may instinctively realize the buyer is unreasonable but, if they agree, they lose the buyer. Sometimes they are afraid to point out: No, the seller will not rip off the two-year-old brown roof and replace it with your favorite color of black. In that instance, the buyer would probably feel alienated and jump ship. They often feel there is not enough real estate business to allow them the luxury of choosing their buyers, so they stick with whomever they get.
The thing is you can’t blame the buyer’s agents when FHA buyers cancel the escrow. Their agents are doing the best they can. You also really can’t blame the buyers, especially when they are first-time home buyers. It probably hasn’t sunk in that all homes have defects, nor that they might not buy a home now, especially if they try to force the seller to meet demands the next buyer won’t make. Or, that it could take them another year to find a home. We have such reduced inventory in the Sacramento area, so little for sale, and almost every cute home will receive more than one offer for it. With every rejected contract, though, they learn more about the market in Sacramento and what it will take to buy a home.
Meanwhile, back at the ranch, the sellers might be wary that the next buyer will cancel the escrow. But that is unlikely. The odds are most buyers who go into escrow manage to close escrow. Sometimes, sellers want to take an offer from a conventional buyer over that from an FHA buyer — OK, most of the time, they do. But in a situation where it was an FHA buyer who elected to cancel the escrow, the seller is actually in luck. Because FHA appraisals are assigned a case number, and when the home immediately resells to another FHA buyer, that same case number will be pulled.
I sold a home in Natomas last year this way. We did not want a conventional offer but accepted FHA for that reason. Agents could not understand, what? No conventional offers?
An FHA buyer who cancels escrow means there are no appraisal concerns for the next FHA buyer. The seller simply lost a couple of weeks of marketing time, but there are dozens of excited buyers right around the corner who would love to buy that home this spring. All the reports have been completed, too, so the seller is able to supply full disclosure prior to an offer. When an FHA buyer cancels the escrow, it’s a slight setback but odds are the next buyer will be stronger, better informed and more deserving in the seller’s eyes, especially when there are no concerns of a low appraisal.
Better yet, the market has gone up. If you’re thinking about selling a home in the Sacramento area, call Elizabeth Weintraub, 916.233.6759. Put 40 years of experience to work for you.
Royal Kona Resort for Lunch and Honokohau Harbor Snorkeling
Hawaii Broker Hella Rothwell and Sacramento Realtor Elizabeth Weintraub at Kona Royal Resort.
Our home inspection at the Hawaii house went fairly well. There wasn’t much the inspector found, just a bunch of minor things, and I am not the kind of Hawaii home buyer to ask the seller to fix them all because that’s just plain idiotic. Every home has defects. Asking for home inspection repairs that are puny makes people irritated. Besides, it is far wiser to maintain good relations with these guys for reasons I won’t go into but suffice to say buyers who nitpick tend to lose sight of the big picture and can end up with no home at all.
I have my own way of doing things. As Hella Rothwell and I were driving to Ali’i Drive to do lunch at the original Don the Beachcomber at the Royal Kona Resort, I noticed a credit union along the way and asked Hella to stop. It makes sense to have a bank account in Hawaii, for many reasons. The problem was I had not planned on opening a new account so I did not have anything more than about fifty bucks on me.
Eureka! Guess what? It costs $50 to open a savings account at Hawaii Community Federal Credit Union. It can’t be done over the phone or online, either. Then I ordered checks and the bank clerk said I could not start the numbering at the four digit I asked for. Sure you can, I suggested. She checked with her boss, and yes, I was right. Then I asked for the checks to have one address and to be mailed to another. Can’t do it, she said. Sure you can. She checked with her boss, and yes, I was right.
Some people always take others at face value but this is the wisdom of aging and experience speaking.
The server at the Royal Kona Resort said she could not get my iPad to take a good photo of us because the background was too light. Sure you can. Just tap our faces. BTW, did you know Don the Beachcomber of Royal Kona Resort fame is credited with creating the pupu platter? The view on the coast is incredible, and the food was excellent, too. My husband I will be able to walk to this Kona Royal Resort from our new home but there is also free validated parking.
After lunch, I decided to schedule a snorkeling adventure through my hotel, so I stopped at the Expedia Travel Desk, which seems to be ubiquitous. The clerk was a bit uppity with me. She suggested a tour that included whale watching. Hey, I’ve gone on whale watching tours from Hawaii that produced zero whales. Also, as I pointed out to her, I’ve had my fill of whale watching in Alaska; we had hundreds of whales following our catamaran, breeching, splashing, enough to last me a lifetime.
Well, that’s a pity, snotty clerk replied.
They love me here. Then she suggested a night snorkeling trip. This is where all the snorkelers get into the cold water, form a circle, hold hands and then shine light into the water to attract fish and manta rays. That did not hold a lot of appeal as I have seen many rays in the Tuamotos. I could see I was not endearing myself to the clerk but she did manage to make me a reservation to go snorkeling at the Honokohau Harbor for today.
