For many of us in the FSBO world, we’d like a little assurance from our buyers. All too often, non pre-approved/pre-qualified buyers get in over their head and show interest in properties that are out of their particular price range, wasting their time, the sellers time, and the lender’s time. It’s not only important from the buyer’s perspective to get—at the very least—pre-qualification so they make a smart financial decision, but it offers the seller a little more assurance as to the sincerity of their offer and the fact that they have made the first steps into obtaining a mortgage.
By getting pre-qualified for a mortgage buyers are essentially getting an initial estimate on what kind of a mortgage they can handle. It’s a financial stress test, and the first step to getting pre-approved. A buyer qualifies for a certain mortgage based on the financial assessment of things like debt and income.
But a buyer is approved for a mortgage after a much more extensive look at their finances and credit report. After completing an official mortgage application, a lender will examine the buyer’s financial background and approve them for a specific mortgage with an idea of the interest rate.
Pre-qualification is nice. But pre-approval is better. Getting pre-approved lets the seller know that you are that much closer to obtaining a mortgage and buying their house. So while it’s not absolutely necessary to do so, getting pre-approved, or at the very least pre-qualified, is a good idea.
Archive for January, 2010
Pre-Qualified and Pre-Approved Buyers
Sunday, January 3rd, 20106 Other Reasons You Should(n’t) Use a Realtor
Friday, January 1st, 2010Here, as promised, is the second installment of the 12 reasons you should use a Realtor.
7. Your REALTOR can guide you through the closing process and make sure everything flows together smoothly
The process of closing a home sale is the most rewarding part of selling For Sale by Owner. So why, then, would you want to share that experience (and the money) with a real estate agent? Just kidding. By the time you are at the closing table, most of the work has been done. You’ve fixed up the house. You’ve shown it. You’ve successfully handled negotiations. At this point you will encounter things like appraisals and inspections to ensure the quality of the property. Sometimes, if things are out of line—say the appraisal was a bit lower than the asking price—then the buyer may want to renegotiate and you as the seller will have to accommodate them accordingly or go with another buyer. You also will deal with legal documentation concerning the exchange of ownership of the property and title. Dealing with legal documents can be an intimidating and confusing venture, so it might be wise to hire yourself and competent and capable real estate lawyer to help you through the process.
8. When selling your home, your REALTOR can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties
The best way to get up-to-date, pertinent information regarding your real estate market is to do your research. Examining recent sold properties can give any FSBO an incredible amount of insight into the current market. Any savvy entrepreneur can dig up the information they need to make an informed and professional decision.
9. Your REALTOR markets your property to other real estate agents and the public
The age when agents were the only ones who can market your property, usually via the help of Multiple Listing Services, is over. Now it’s commonplace to list your property on a public listing service through websites such as Yigdigs.com.
This reason is perhaps the greatest asset to the realtor. Marketing your property is so important and it used to be that realtors were the only ones with the know-how and the resources available to them to do it right. But times have certainly changed and people can now be their own realtor and use the MLS to their advantage.
10. Your REALTOR will know when, where and how to advertise your property
Generally, it is believed that advertising sells real estate. Well according to Realtor.com, industry connections are the method by which most real estate professionals come to locate buyers and sellers. Fortunately, for the FSBO, there is a community at large on the Internet, waiting at your fingertips. Go to Yigdigs.com to locate and communicate with buyers and sellers from across the nation.
11. Your REALTOR can help you objectively evaluate every buyer’s proposal without compromising your marketing position
A buyer’s proposal is the first step in many of the legally binding contractual proceedings that begin the selling of a house. When buying a house it helps to be informed as to what the buyer’s proposal is binding the buyer to. And as many realtors like to claim, these types of agreement are complicated contracts that offer a lot of pitfalls to For Sale by Owners. Well, to the contrary, a buyer’s proposal is not as complicated and messy as some may lead you to think. It’s good advice to, once again, hire a legal professional to help you through the process and save you thousands on commission.
12. Your REALTOR® can help close the sale of your home
If you’re one of the millions of FSBO’s who have reached the coveted “closing table” then, like I said before, most of the work is done for you. In order to close the deal there will most likely be a few inspections and proceedings that must be addressed in order to ensure the validity of the property’s worth. As a seller, all you have to do is cooperate. You’ve reached the closing table already so nothing should be standing in the way of your and your sale.
