Q: Why do I need to get pre-approved before I even find the property to buy?
A: Sellers are looking for “most” qualified buyers to accept their offer. Sellers do not want to waste their valuable time for unqualified buyers. You maybe are competing with other “qualified” buyers for the same property.
Q: Why do I need to provide “bank statements” when my agent is ready to present my offer?
A: If you are competing with other buyers and the other buyers’ agent did not provide their buyers’ bank statements to prove their buyers do indeed have the liquid funds ready to close the deal. Your offer will stand out and most likely will be the chosen one.
Q: Why do I have to provide earnest money deposit (EMD) at time of writing my offer?
A: You want to convince the seller that your offer is a SERIOUS offer. You will need to put the “ balance” of your deposit into escrow anyway once your offer is accepted . Why don’t you show the seller you are putting 3% of the offering price right at the beginning NOT just minimal $500 or $1000 which is not even 1% of your offering price say on a $250,000 price of property. If seller is chosen between a LOW EMD and HIGH EMD supposedly all others price & terms are similar. Your offer will Stand out in seller’s eyes when making accepting offer.
Q: I really like THIS Short Sale home, should I even consider Short Sale properties?
A: It all depends. If the listing agent has the proper training and knows how to work with qualified sellers and buyer’s agent knows “how to”, You should consider if you really like the home. I have seen properties get foreclosed on after months and year of all parties’ hard work. Know the “HOW TO” is the KEY to a successful Short Sale close.
Q: Can I put offers on more than ONE Short Sale Properties?
A: No, it is like you are “engaged” with your “future” husband or wife”, you are not supposed to “look around” and trying to find another person to “date” for perhaps to find a better fit. Unless your offer got REJECTED or COUNTERED with the price or terms NOT acceptable to you. Then you may cancel this deal and put offer on another property. You as buyers, you need to be “committed” and have patience to wait for sellers’ short sale lender gives you their answer.
Q: What does “Per Diem” mean in a REO (Bank Owned) sale?
A: “Bank owned” or “REO” sale property as they are often referred to, you may see verbiage like “per diem penalty” in Banks Addendum to the Real Estate Purchase contract. “Per Diem” in Latin is for “per day”. What per diem is referring to in this instance is in the event escrow does NOT close by the date set forth in the contract, the seller can impose a daily penalty to the buyer for each day beyond the initial agreed upon closing date until the day the escrow officially closes.
Q: What if “per diem” verbiage is in buyer’s contract?
A: One way a buyer can do is to strive to close escrow on time and avoid penalties is to complete escrow and mortgage paper work and provide requested documents in a timely manner. However, circumstances may still arise that are beyond the buyer’s control. In this event, a buyer should ask their agent to renegotiate the terms of the contract to extend the closing date or to waive the penalty with the seller and seller’s agent. In REO transaction, as with any real estate transaction, it is very important to be sensitive to all time frames in order to alleviate unnecessary charges.
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