Home buyers and Credit Fitness

Many home buyers now and into the foreseeable future will be facing tight lending standards and the need to improve the credit score to get prequalified for mortgages. Some steps to speedy credit repair to gain lender approval and the best possible rates; especially if you are a few months away from purchasing.

CREDIT CARD WISDOM

• paying DOWN revolving charge cards is more beneficial than paying down student loans or auto loans
• ALWAYS leave 30% or higher between what you owe and the credit card limit
• Use cards with care EVEN IF you pay off the balances monthly; because depending on the statement dates the lender may see the big balances
• pay down the cards closest to their llinits for speedier credt repair. The lender will see the "gap" it wants to see.
• Do NOT ask creditor to lower credit limits. Generally, carrying low balnces on several cards is better than one large balance on one card
• check your credit card limits to make sure the report is correct. Limits may not be reported on all cards.
• Never make a late payment on credit cards or any loan.

PROTESTING ITEMS:

• Protest unjust negatives, such as late payments, collections that are not yours and any items not reported as "paid as agreed", if you paid on time and in full.
• Protest items listed as unpaid that were included in a bankruptcy and items older than (7) seven years (10 bankruptcy)
• Focus  FIRST on th elarger newer negatives listed on the report

It is important NOT to worry about smaller items such as incorrect address information, or old employer listed as current. Unless ther is the possibility of identity theft or the file is mixed up with someone else.

This certainly is not an all inclusive list of the steps that can be taken to improve a credit score, it is a great starting point, before attempting to get pre-approved and purchase a home. 

 

Taking the Insult Out of an Insulting Offer

Taking the Insult Out of an Insulting Offer

The first step toward taking the sting out of a low offer is to assure the client that the offer is financial, not personal. Most likely the prospective buyers don’t know the sellers or the sellers’ family. They might not even know the rationale behind the number they presented. They may have relied on poor counsel, too much counsel, or an unskilled agent, in which case a well-presented counter offer is in order.

On the flip side, the sellers’ house may be overpriced, either because the sellers insisted on a high price or because the market environment changed between when the home was listed and when the offer arrived. When a home is radically overpriced then a fair offer can look insulting when it really isn’t.

When the sellers’ home is overpriced, one must get them to focus on the gap between the low offer and fair market value, not the difference between fair market value and their inflated listing price. Likely you’ll remove tens of thousands of dollars of “insult” through this calculation alone. When that doesn’t work, ask the cooperating agent to share the rationale behind the offer.

A good agent won’t write an insulting offer. I was asked many times to write ridiculously low offers. I consistently refused to represent those on the equivalent of a fishing expedition. One client chastised me, saying I was required by law to write whatever she wanted to offer.  I corrected her misinterpretation of my responsibility. Agents are required by law in most states to present all offers they write, but nothing forces agents to write garbage that is embarrassing to present and wasteful of their time, and costly to their reputations.

Getting beyond emotion

People get emotional during the closing for a number of reasons. For one thing, money is at stake. For another, both parties are anxious to get the deal done and time is ticking away. For a third, home inspections and low-price offers reveal opinions about a home’s value that can feel jarring to sellers who have viewed the home with pride and joy for a number of years.
The only antidote to an emotional uprising is a pragmatic focus on the goals the parties are trying to achieve and a renewed commitment to find common ground and get the deal done.

He was such a typical seller! His big issue was the sales price. I asked him the question I often pose to get to the core of what’s affecting a sale negotiation:  “Is the reason you want this price for the house based on your ego or do you really need the money?” There was silence on the other end of the phone.   I knew he didn’t need the $20,000 he was so emotional about.

From that point, he was able to find common ground with the buyer and get the home sold.

When you hit a buyer-seller impasse, find a way to ask: Is this about ego or income? Do they want the bragging rights that come with a high price, or do they need the money? Usually, you’ll bring your client back down to earth in a hurry. You’re asking, in essence, what are you really fighting for?