If you’re trying to buy a home, you’re preapproved, and you’ve been making offers but you keep losing out because you have multiple offers, here are some things you need to consider. 1st things 1st, this is provided that your loan is fully intact, that you are well qualified and that the loan essentially is guaranteed. Once that element is in place it becomes a function of you in your cache and what you must work with or, lack thereof. Perhaps the real estate agent selling you to the terms of the buyer or selling you to the terms of the seller. It’s not a function of changing the loan program.
Here’s what the reality of it looks like. Let’s say you’re in a particularly competitive real estate market and you’re looking in a house price point around $275,325 which in most markets is a very competitive price point. Let’s say that your pre-approved and all you must work with for a $300,000 purchase price is $10,000 which is the 3 and a 1/2 percent down payment in this example. Closing costs on the size of a purchase were probably another $7,000 maybe $7,500 depending on the area in which you’re buying. Say you’ve made 5 or 6 offers and you keep losing because there’s multiple offers at prices around the $300,000 price point. Well the answer is don’t point the finger at the loan program because the issue is you can’t get into contract. You need a solar credit for closing costs and in this market while it’s not impossible to get, it’s very difficult. The only advantage you have, is to either make a shorter priced offer, release alone contingency sooner, or in a president’s contingency sooner put an expiration on your offer, ask for a gift from family, Built-in a purchase price credit for closing costs. It’s not automatically necessarily a function of changing loan programs when the loan program is already in place when in order to get into contract you need to fix one of the other elements.
Stay the course it might be difficult, and it might take a while to get into contract but if you keep your nose to the grindstone, it will happen. You just need to have a realistic agent fight aggressively for you. They must roll up their sleeves and do what it takes to get you into contract on the house that means selling you to the other side. If the real estate agent you’re working with not doing that, well it might be time to change real estate agents depending on how you feel and how they’re working for you or not. It also might mean you having to bite the bullet so to speak and offer a little bit more on the house in order to get into contract to beat out the other offers. You must make an offer automatically higher to offset the solar credit for closing costs. Or you bite the bullet again and go to mom, dad, your brother, your sister or any family member, swallow your pride and ask for the credit and/or the gift moneys for the closing costs. This way gives you a fighting competitive chance. What it boils down to is you have to make a concession by swallowing your pride and asking for help from family for example for the additional money for the closing costs. Borrowing that money for example, or being willing to take a slightly higher mortgage payment on a higher priced house in order to generate an offset for the credit for closing costs which the seller contributes or you need a real estate agent that’s willing to be aggressive on your behalf and fight for you to make it happen.
A variable of changing loan programs, while it sounds fine and dandy for example switching from an FHA 3 and a 1/2 percent down to a dumb payment assistance loan is not the answer. The reason why it’s not the answer is because most of those programs have not only income constraints but also contain higher interest rates because there’s no such thing as a free lunch. It’s a dream that the payment will be higher on a down payment assistance program if you can even qualify for a dump payment assistance program than it would be by paying more for the house and getting a solid credit for closing costs and having your real estate agent muscle up on their negotiation skills for your benefit.
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