Is Your Home Purchase Offer… Simply the Best?
Is your home purchase offer truly the best it can be? With the real estate market heating up and multiple offers becoming common, it’s vital to ensure that both buyers and sellers are getting the most out of the deal. The iconic Tina Turner song “Simply The Best” comes to mind, prompting us to ask whether the submitted contract offers genuinely live up to that standard.
One of the most critical components of a strong offer is the pre-approval letter from a lender. However, not all pre-approval letters are created equal. It’s not just about checking a box; it’s about ensuring the buyer is financially sound and capable of following through with the purchase. This means the pre-approval letter should be from a reputable lender who has thoroughly vetted the buyer’s financial situation.
Having a reputable loan officer is key to ensuring the validity of the pre-approval. If the loan officer is simply a “cube jockey” at a desk, merely answering phones all day, without any track record or reputation in the industry, how can you trust the pre-approval they provide? Working with a loan officer with a proven track record and who is known within the real estate community is crucial.
Furthermore, it’s important that these loan officers be accessible, especially on weekends. Real estate transactions often move quickly, and having the ability to reach the loan officer to go over the pre-approval can make a significant difference. If a loan officer is unavailable on weekends or after hours, it could be a red flag regarding their commitment and reliability.
Unfortunately, some pre-approval letters may lack proper verification. They might merely be based on a conversation between the buyer and the lender without real scrutiny of credit scores, income, or assets. Many listing agents accept these letters at face value, assuming they meet the requirements for an acceptable offer. However, what’s written on the letter may only be worth the paper it’s printed on if it hasn’t been properly verified.
This is where the role of the listing agent becomes crucial. A diligent listing agent will contact the reputable loan officer who provided the pre-approval letter to confirm the details and discuss the buyer’s financial situation. This ensures that the offer is solid and minimizes the risk of the deal falling through due to qualification issues.
Furthermore, the date on the pre-approval letter is significant. Rates in the mortgage market fluctuate daily, so a letter that’s not relatively current may not accurately reflect the buyer’s financial standing. It’s essential to request a new letter if the date is too far removed from the date of contract submission, as a recent rate change could impact the buyer’s ability to qualify for financing.
While the bid price is undoubtedly important, it’s not the only factor to consider. A deal that falls through due to qualification issues renders the bid price irrelevant. Therefore, it’s essential to focus on the overall strength of the offer, including the buyer’s financial readiness and the reliability of their loan officer.
In conclusion, in today’s competitive real estate market, ensuring that your home purchase offer is more than just a checkbox exercise is crucial. By prioritizing the quality of the pre-approval letter and thoroughly vetting the buyer’s financial situation, buyers and sellers can enter a transaction with confidence, knowing that the deal they’re getting is “Simply The Best.”
Remember… the BEST RATE… IS A LOCKED RATE… with a float down… ask me about our program that allows you to lock your rate and then float down if rates move lower.
Make sure you (or your buyer) get pre-approved before looking at homes so we can determine if you are looking in the correct price range and have you armed to submit an offer with a pre-approval letter!
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Blog post date: Thursday, April 11, 2024
