7 Clever Home Buying Negotiation Tactics

Getting the house you want at the price you want can be tricky – even in a buyer’s market. Sometimes a home seller just isn’t willing to budge on price. Don’t despair! There are other ways to sweeten the deal and drive it to close in a buyer’s market. Here are seven tips on how to negotiate with a home seller.

Seller

Learn as much as you can about the motivations and situation of the home sellers. For instance, if they’re living in the house and they need flexibility around the closing date, you could offer to be flexible on closing if they move on terms. In the case of estate properties, take some time to learn about the heirs – where they live, what kinds of houses they live in and whether or not they are in legal or financial trouble. It sounds creepy, but most of this information is available for free online once you have the names of the home sellers. You can also research obits and marriage documents that are in the public domain. The more you know, the more leverage you have when it comes time to negotiate.

Know What the Property is Worth

Work independently or with your agent to research comparable sales in the immediate area of the home, then make an offer at least 10 percent below what the market says it’s worth. Dig into the details to figure out how the home you want to buy stacks up against comps, and look for ways to communicate the legitimacy of your offer or requests by backing it up with data. For instance, if all comparable sales have a pool, waterfront property or updated kitchens and the house that you want doesn’t, point that out. Use this data to justify your offer or other requests to create value if they won’t budge on price.

Don’t be Afraid to Ask

If there are things that you want or need to feel comfortable with the deal, ask for them. The home seller can always refuse, but if you don’t ask, you don’t know. If you’ve created leverage by learning about the property and the seller’s situation, you can use this information to ask for things, such as repair of items found during the inspection period or appliances that weren’t listed on the original contract for the house. Don’t make assumptions. Even if your realtor balks at the idea, always ask.

Offer a Quick Close

The faster a deal gets done, the more quickly the home seller can cash out their asset and move on with life. Homes that remain on the market or unsold for extended periods of time become costly to sellers (especially if they’re unoccupied) and start to decline in condition. Offering a quick close builds confidence with the seller as it means that there’s less time for things to go sour with the deal. If you’re situation allows for this negotiation tactic, you might be able to either lower your price or get other benefits in exchange.

Make an As-Is Offer and Ask for the Furniture

If you want to make a reasonable but low offer on a property, consider the pros and cons of presenting an “as-is with right to inspect “ offer. The upside is that you can walk away from the deal if the inspection frightens you. The downside is that what you see is what you get, leaky plumbing, termites, mold and all. If you really want a property and are willing to take it as-is, but aren’t really comfortable with the seller’s floor price, ask for the furniture or other non-fixed assets that make the deal more palatable such as a boat or fitness equipment.

Ask the Home Seller to Cover Closing Costs

If you’re apart on price for the home itself, one way to get around the cash crunch and get a deal done is to meet the home seller on price, but ask them to cover all or part of the buyer’s closing costs. Some home sellers might balk, but if they’re able to do this and want to finish the deal with a sale at a particular price point, this technique can work.

Be Willing to Walk Away

Buying a home can be an intensely emotional experience, but at the end of the day it is really just a business transaction. This means you can’t get attached, and you have to be willing to walk away if you’re unable to negotiate with a home seller or if the seller becomes unreasonable. If the seller’s agent senses desperation or over-eagerness on your part, they might interpret that as a signal that they have the upper hand. Silence can be your friend. Hold your cards close and always be willing to walk away.

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The G-Team, your Maryland Real Estate Connection: We are located in Millersville, Maryland between Baltimore and Annapolis in Anne Arundel County convenient to Fort Meade. We also service Howard & Queen Anne’s Counties and central Maryland. Whether you are BUYING, SELLING, RELOCATING or Short Sales we can HELP with Real Estate in Anne Arundel County, Howard County, Queen Anne County, Baltimore County, Harford County,  Annapolis, Arnold, Crofton, Crownsville, Davidsonville, Eastport, Edgewater, Fort Meade, Gambrills, Glen Burnie, Hanover, Linthicum Heights, Millersville, Mitchellville, Odenton, Pasadena, Piney Orchard, Severn, Severna Park, Columbia, Ellicott City, Clarksville, Kent Island, Bel Air, Bowie, Brooklyn Park, Catonsville, Curtis Bay, Dundalk, Elkridge, Essex, Farmington Village, Gibson Island, Grasonville, Halethorpe, Harmans, Laurel, Lutherville, Timonium, Parkville, Perry Hall, Piney Orchard, Queenstown, Riva, Shipley’s Choice, Stevensville, Tracy’s Landing, West River, White Marsh, Middle River, Towson, Abington, Woodstock, Bowie, Forest Hill, Notingham, Parkville, White Marsh, Rosedale, Perry Hall, Cooksville, Owings Mills, West Frendship, Woodstock, Mount Hebron, Sykesville, Eldersburg, Marriottsville, Ocean City, Owings Maryland

 

8 Tips: Now that YOU have decided to buy!

8 Tips: Now that YOU have decide to buy!

 1. Decide to Buy.

Although there are many good reasons for you to buy a home, wealth building ranks among the top of the list. We call home ownership the best “accidental investment” most people ever make. But, we believe when it is done right, home ownership becomes an “intentional investment” that lays the foundation for a life of financial security and personal choice. There are solid financial reasons to support your decision to buy a home, and, among these, equity buildup, value appreciation, and tax benefits stand out.

Base your decision to buy on facts, not fears.

1. If you are paying rent, you very likely can afford to buy
2. There is never a wrong time to buy the right home. All you need to do in the short run is find a good buy and make sure you have the financial ability to hold it for the long run
3. The lack of a substantial down payment doesn’t prevent you from making your first home purchase
4. A less-than-perfect credit score won’t necessarily stop you from buying a home
5. The best way to get closer to buying your ultimate dream home is to buy your first home now
6. Buying a home doesn’t have to be complicated – there are many professionals who will help you along the way

2. Hire your agent.

The typical real estate transaction involves at least two dozen separate individuals – insurance assessors, mortgage brokers and underwriters, inspectors, appraisers, escrow officers, buyer’s agents, seller’s agents, bankers, title researchers, and a number of other individuals whose actions and decisions have to be orchestrated in order to perform in harmony and get a home sale closed. It is the responsibility of your real estate agent to expertly coordinate all the professionals involved in your home purchase and to act as the advocate for you and your interests throughout.

Seven main roles of your real estate agent

A Buyer’s Real Estate Agent:

1. Educates you about your market.
2. Analyzes your wants and needs.
3. Guides you to homes that fit your criteria.
4. Coordinates the work of other needed professionals.
5. Negotiates on your behalf.
6. Checks and double-checks paperwork and deadlines.
7. Solves any problems that may arise.

Eight important questions to ask your agent

Qualifications are important. However, finding a solid, professional agent means getting beyond the resume, and into what makes an agent effective. Use the following questions as your starting point in hiring your licensed, professional real estate agent:

1. Why did you become a real estate agent?
2. Why should I work with you?
3. What do you do better than other real estate agents?
4. What process will you use to help me find the right home for my particular wants and needs?
5. What are the most common things that go wrong in a transaction and how would you handle them?
6. What are some mistakes that you think people make when buying their first home?
7. What other professionals do you suggest we work with and what are their credentials?
8. Can you provide me with references or testimonials from past clients?

Contact: Jesse Gillis TheG-Teams Buyers agent 443-306-6161 email jesse@theG-team.com

3. Secure financing.

While you may find the thought of home ownership thrilling, the thought of taking on a mortgage may be downright chilling. Many first-time buyers start out confused about the process or nervous about making such a large financial commitment.

From start to finish, you will follow a six-step, easy-to-understand process to securing the financing for your first home.

Six steps to: Financing a Home

1. Choose a loan officer (or mortgage specialist).
2. Make a loan application and get preapproved.
3. Determine what you want to pay and select a loan option.
4. Submit to the lender an accepted purchase offer contract.
5. Get an appraisal and title commitment.
6. Obtain funding at closing.

4. Find your home.

You may think that shopping for homes starts with jumping in the car and driving all over town. And it’s true that hopping in the car to go look is probably the most exciting part of the home-buying process. However, driving around is fun for only so long – if weeks go by without finding what you’re looking for, the fun can fade pretty fast. That’s why we say that looking for your home begins with carefully assessing your values, wants, and needs, both for the short and long terms.

Questions to ask yourself.

1. What do I want my home to be close to?
2. How much space do I need and why?
3. Which is more critical: location or size?
4. Would I be interested in a fixer-upper?
5. How important is home value appreciation?
6. Is neighborhood stability and priority?
7. Would I be interested in a condo?
8. Would I be interested in new home construction?
9. What features and amenities do I want? Which do I really need?

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5. Make an offer.

When searching for your dream home, you were just that – a dreamer. Now that you’re writing an offer, you need to be a businessperson. You need to approach this process with a cool head and a realistic perspective of your market. The three basic components of an offer are price, terms, and contingencies.

Price – the right price to offer must fairly reflect the true market value of the home you want to buy. Your agent’s market research will guide this decision.

Terms – the other financial and timing factors that will be included in the offer.

Terms fall under six basic categories in a real estate offer:

1. Schedule – a schedule of events that has to happen before closing.
2. Conveyances – the items that stay with the house when the sellers leave.
3. Commission – the real estate commission or fee, for both the agent who works with the seller and the agents who works with the buyer.
4. Closing costs – it’s standard for buyers to pay their closing costs, but if you want to roll the costs into the loan, you need to write that into the contract.
5. Home warranty – this covers repairs or replacement of appliances and major systems. You may ask the seller to pay for this.
6. Earnest money – this protects the sellers from the possibility of your unexpectedly pulling of the deal and makes a statement about the seriousness of your offer.

6. Perform due diligence.

Unlike most major purchases, once you buy a home, you can’t return it if something breaks or doesn’t quite work like it’s supposed to. That’s why home owner’s insurance and property inspections are so important.

A home owner’s insurance policy protects you in two ways:

1. Against loss or damage to the property itself
2. liability in case someone sustains an injury while on your property

The property inspection show expose the secret issues a home might hide so you know exactly what you’re getting into before you sign your closing papers.

• Your major concern is structural damage.
• Don’t sweat the small stuff. Things that are easily fixed can be overlooked.
• If you have a big problem show up in your inspection report, you should bring in a specialist. If the worst-case scenario turns out to be true, you might want to walk away from the purchase.

7. Close.

The final stage of the home buying process is the lender’s confirmation of the home’s value and legal statue, and your continued credit-worthiness. This entails a survey, appraisal, title search, and a final check of your credit and finance. Your agent will keep you posted on how each if progressing, but your work is pretty much done.

You just have a few preclosing responsibilities:

1. Stay in control of your finances.
2. Return all phone calls and paperwork promptly.
3. Communicate with your agent at least once a week.
4. Several days before closing, confirm with your agent that all your documentation is in place and in order.
5. Obtain certified funds for closing.
6. Conduct a final walk-through.

On closing day, with the guidance of a settlement agent and your agent, you’ll sign documents that do the following:

1. Finalize your mortgage.
2. Pay the seller.
3. Pay your closing costs.
4. Transfer the title from the seller to you.
5. Make arrangements to legally record the transaction as a public record.

As long as you have clear expectations and follow directions, closing should be a momentous conclusion to your home-searching process and commencement of your home-owning experience.

8. Protect your investment.

Throughout the course of your home-buying experience, you’ve probably spent a lot of time with your real estate agent and you’ve gotten to know each other fairly well. There’s no reason to throw all that trust and rapport out the window just because the deal has closed. In fact, your agent wants you to keep in touch.

Even after you close on your house, you agent can still help you:

1. Handle your first tax return as a home owner.
2. Find contractors to help with home maintenance or remodeling.
3. Help your friends find homes.
4. Keep track of your home’s current market value.

Attention to you home’s maintenance needs is essential to protecting the long-term value of your investment.

Home maintenance falls into two categories:

1. Keeping it clean: Perform routine maintenance on your home’s systems, depending on their age and style.
2. Keeping an eye on it: Watch for signs of leaks, damage, and wear. Fixing small problems early can save you big money later.

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What are Easement Restrictions? How to Ensure Clear Title on a Property.

When buying real estate you’re bound to encounter some things that you don’t know anything about. They are things that outside of the home buying process you won’t ever run into. And since the average homebuyer only goes through this process a few times in his or her lifetime, it’s understandable that these things would be unfamiliar. A couple of items that seem to be perplexing are title insurance and the property survey, specifically how easements are represented.

When purchasing a home with a mortgage you need to get title insurance and a survey. This is required for all financed home purchases. An attorney or title company typically orders property surveys. Though the buyer has to pay for this service they usually don’t need to be directly involved in the process.

What is Title Insurance?

Title insurance is just another line item expense when purchasing your house, paid for one time at closing. Essentially, it is protection for you and your mortgage company that the person selling you the house has full and clear title to the property and was able to legally pass it to you. The title insurance company investigates the ownership of the property and then insures their work. If the seller didn’t rightfully own the home, and someone else does, the mortgage company and the homebuyer are financially protected. Fortunately, issues of title defects are relatively rare, meaning that title insurance isn’t too expensive and really not something to worry about.

What is a Property Survey?

A property survey is a carefully measured drawing that shows the land that is for sale and all structures on the property. It shows how large all the structures are and how far they are from each other and the borders of the property. Most importantly, it shows setbacks and easement lines.

Wait, what? It seems like the property lines and structures should be most important, but they are not. The setbacks and easement restrictions are actually the most critical elements of the survey because those are usually where the biggest problems are found.

What is a Setback?

A setback is the required distance between the house you wish to buy and other property features. For example, a city or county ordinance (or even a homeowners association) may require that homes be set back 20 feet from the road. So even though you own your front yard, you cannot extend your house any closer than 20 feet from the road.

Other setbacks indicate how closely you can build to your property boundaries or to your neighbors’ homes. If you live in an area with natural features like streams or lakes, certain special setbacks may also dictate how close you can build to these structures.

What is an Easement?

Easements refer to property with common usage rights. For example, you may own the land that a sidewalk is on, but anyone can walk on this part of your property.

Why Setbacks and Easement Restrictions Matter

What happens if the survey reveals that part of the house (the actual structure) up for sale sits within a setback or an easement? It’s a problem! In some instances it means that part of the house will need to be torn down before it can lawfully be sold. Otherwise title cannot be passed to a new owner because someone is attempting to sell property that was not built legally.

Surprisingly, this situation is not so uncommon. It may not affect the main domicile on a property, but garden sheds or pool equipment are occasionally located in an area where they don’t have a legal right to be. In these cases your lawyer has some work to do. Hopefully, you’ll discover that the structures are grandfathered because they were erected before certain setbacks were enacted. But definitely investigate these matters fully, as doing future improvements on the property may necessitate that they be corrected in the process.

Spend Some Time With Your Property Survey

For some, the survey process is one of those “check the box” items during home buying. Most get it done and move on. But it’s important to look over everything carefully and ask questions. Surveyors are happy to discuss the survey with you, and errors on surveys can occur. Spending 15 minutes looking this over will save you the headache of having it redone down the road when you want to build or make a change on your property.

The G-Team, your Maryland Real Estate Connection: We are located in Millersville, Maryland between Baltimore and Annapolis in Anne Arundel County convenient to Fort Meade. We also service Howard & Queen Anne’s Counties and central Maryland. Whether you are BUYING, SELLING, RELOCATING or SHORT SALES we can HELP.