Lowballing Your Offer is Risky Business

Lowballing Your Offer is Risky Business

Call Tami Winbury Keller Williams Realty 805-798-3412 for all your Real Estatae Needs

Let's say you are a buyer and you have found a house that meets your needs and its listing price is in your financial comfort zone. You have reviewed recent comparable sales for like properties. You have established what you think the value of the home is. You are armed with a pre-approval if you are going to seek financing or have copies of statements verifying liquid funds if you are paying cash. You are ready to make an offer and open good-faith negotiations for the house.

Okay, so stop for a moment and think of yourself as a pitcher...a baseball pitcher. Think of the seller as the batter at the plate. The catcher's mitt is like the comps - the target you are aiming for. Are you with me?

Pitchers have more than one pitch. Each pitch is used for a different strategy. Offers are the same. You can make a full-price offer with super strong terms - a fast ball pitch down the middle of the plate. If a house is priced at market value and there is strong competition from other buyers, your fast ball is the best option. And you may have to go over the ask...that is put a little extra on that pitch!

You can make an offer somewhere at the bottom of the zone of established value. That is like throwing a slider or a breaking ball low and inside...if it is interesting enough (strong terms like a high percentage down, no mortgage contingency, waiving of inspections), the seller will take a look at that pitch and may swing (a decent counter offer comes back to you) or a check swing (no or low counter offer).

Or, you can combo up some strong terms with a sensible value price...that's like throwing a knuckleball in the strike zone and let the seller make contact. Get the ball in play and see if you can reach agreeable terms and price for both sides.

Lately, I am seeing too much of the dangerous pitch choice...the wild pitch. Lowball offers are like wild pitches. Wild pitches are so far out of the zone, the catcher doesn't see it coming, can't catch it and the batter is puzzled and trying not to get injured. Same thing with lowball offers. They insult the seller, confuse the agents about your motivation and there is no basis in anything concrete to support the offer. Pitchers who pitch wild pitches get pulled. The seller reacts the same way by making no counter offer and saying "NEXT!" and some other choice words I cannot type here. Your wild pitch of an offer has set a tone for the negotiation and vicariously painted a picture of yourself as being opportunistic, or unrealistic or not serious. If the seller is able to remain calm and let you make an improvement, you are lucky. But the damage has been done. You have left the door wide open for another buyer to come in and give the seller incentive to listen more closely to them as direct response to your lowball offer.

So, when you are ready to make an offer think of yourself as a pitcher with a choice of pitches. AVOID WILD PITCHES. Study your target. Get that offer over the plate and give the batter something to look at and consider swinging at! If you can put the ball in play, you are on your way to buying a house.

Call Tami Winbury Keller Williams Realty for all your California Real Estate needs 805-798-3412 DRE#01878369

Written by Daniel Gale in Long Island danielgale.com

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Financing after Bankruptcy, Foreclosure,  Short Sale?

How long must I wait before obtaining financing after bankruptcy, foreclosure or short sale? Call Tami Winbury Keller Williams Realty for all your Real Estate Needs 805-798-3412 www.ShortsSale.org A common question home buyers have today is: How long must I wait before obtaining financing after bankruptcy, foreclosure or short sale? Below is an overview by loan type of this important information. • Learn about home loans • Use loan calculators • Apply for a home loan Robert Clark Senior Loan Officer Prospect Mortgage NMLS# 440892 1000 Town Center Drive #300 Oxnard, CA 93036 Office: (805) 322-3418 Cell: (805) 302-9444 Fax: (877) 630-0933robert.clark@prospectmtg.com Call Tami Winbury Keller Williams Realty for all your Real Estate Needs 805-798-3412 www.ShortsSale.org

3 Keys to Qualify for Mortgage Using Cash Income

3 keys to qualify for mortgage using cash income

Tami Winbury Keller Williams Realty will help you find a great lender! 805-798-3412 www.ShortsSale.org Serving Ojai and Ventura County Real Estate


Q: For the past year I have been holding two part-time jobs: one job pays me in cash only and the other pays me with a traditional paycheck. The job that pays me in cash allows me to save about $3,000 per month, which I put into a savings account, so I have quite a bit of cash saved up. I am planning to buy a house within the next year. I would like to use this savings toward my down payment. Will this be questioned or cause me problems?
A: First, you should be very proud of yourself for having the discipline and drive to both work two jobs and to save up such a significant amount every month. But you're smart to ask in advance about how your cash income will be construed by lenders. In terms of your down payment, all funds that have been in your accounts for two months or longer at the time your loan is being underwritten are presumed to be yours by a lender.
Your bigger challenge will arise in the event that you want or need the lender to consider that $3,000 per month in cash income as part of the income that qualifies you for the mortgage. If so, there are several things you'll need to put in place.
First, if this is a part-time job, you'll probably need to be able to document that you've been there at least two years for the lender to allow you to use it to qualify.
Second, be prepared to produce a letter from your employer, known in the industry as a continuity letter, essentially verifying your employment and indicating that your employment is "expected to continue."

And third, as with any sort of income, you will be required to produce two years' worth of federal income tax returns; the bank will average your taxable income from the last two years and use that as the baseline income upon which you'll be qualified. (If you haven't been paying taxes on your cash income, but you will want or need to use it to qualify for a home loan, now's the time to meet with your tax preparer and your mortgage broker and evaluate whether it makes sense to file an amended tax return and pay the appropriate taxes on your income.)

Depending on the specific facts of your situation, your lender might require you to jump through additional hoops in terms of documenting that income; on the other hand, you might not need the income to count for mortgage purposes if you can qualify for a large enough home loan on the basis of your traditionally paid income.


Long story short: Loop your mortgage broker or other lending professional in on your situation, stat, so you can begin the process of positioning and documenting this income to make the most of it in your mortgage application and qualification process.

Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions


Tami Winbury Keller Williams Realty 805-798-3412 DRE#01878369 (repost