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I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?
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wrote:

I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?

Hi,
Is that 5 grand a down payment or deposit? You can make an offer with
several conditions like passing house inspection, etc. I never lived in
a pre-owned house. You can do some of your own research regarding price
trend in the area. Location is most important and price per square foot
plus/minus extras, work to be done, etc., etc.
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wrote in message
...

I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?


One time I went with a friend to look at land. We looked at a 100 acre
parcel that the owner wanted $200,000 for ,and according to the realtor,
would only come down slightly. As my friend wasn't particularly interested
in this parcel, he played both the realtor and the owner, like a deck of
cards, at the point that he walked away from the deal, she was down to
$50,000. A house is worth whatever someone is willing to pay. You need to be
your own advocate. You need to see what comparable houses in that area are
selling for, not what they're asking for them, but what they're actually
selling for. Rule number one. Your realtor works for the seller. Unless
you've hired a buyers realtor, the realtor works for the seller. In some
states, they actually have to have you sign a form, so you understand this.
Your realtor will say anything, do anything, hopefully within the law, to
make a sale. Get all your information independent of the realtor,and just
use them to get you into houses you want to look at


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wrote:
I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.


I suppose he wouldn't since his commission is a percentage...

You _do_ have legal representation, right?


My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?


Earnest money isn't required to make a bona fide offer of whatever level
you should choose. That can be arranged during the negotiations as part
of the seller's acceptance/rejection process.

There are too many variables to be able to say anything at all other
than you're way too green going here -- you should at a minimum research
what other houses in the area have sold recently and for what price.
How long has this particular property been listed? How long did
comparable properties take to sell?

W/O knowing anything at all about the area you're in, it's impossible
for anybody here to even hazard a guess as to how depressed the housing
market is there at whatever price range. Some areas are in the dumper,
others have seen very little impact.

Do you think that I could demand lower than or around $180,000?


You can't "demand" anything -- you can make an offer of whatever you
choose and the broker has to tender it. They can reject it outright,
counter-offer or accept. Your move again.

Ever hear of Bruce Williams on evening talk radio? He's great at
fleshing out the details and the pitfalls. He's got a book altho I've
not seen it--if you can find the show, call and ask your questions--but
have a reasonably thick skin; he doesn't suffer fools easily!

--

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wrote in message
...

I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.


Dump the realtor. It's apparent, he finds you as naive, as a first time
buyer. Public records will show exactly how much the house is being taxed,
when it was purchased, how many owner's it's been through, and so much
more.

It's not surprising, the realtor hasn't shown you any of this information.
As someone else pointed out, they are working on commission, and this one
wants to fatten their pockets, as much as possible. Remind them, they are
suppose to be working for you.



My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.


Dump this idiot. "If" you find you really want to make an offer, you put
down little earnest money. If you decide to back out for some reason or
another, you might find the money tied up. Legally, they can't force you to
buy the house, but they can make it hard for you to get your earnest money
back.






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wrote in news:f5878ef9-ef99-4b2f-9555-abbfa28d23c0
@e60g2000hsh.googlegroups.com:


I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?


Ask the realtor to pull the CMA's (comparative market analysis) aka Comps
on 3 homes that have CLOSED in the SAME AREA within the last 6 MONTHS. I
say CLOSED and not "active listings". People can list the price at
anything. What they get is a different story. If the market is changing
rapidly there you may want to ask for 3 months.

The realtor may mention that the comps do not reflect and sale
contingencies on the price it sold for. For example: seller to put new roof
on, seller paid some closing costs, seller agreed to have driveway
resurfaced, seller paid an upcoming assessment which technically he did not
have to.

If the realtor discourages you from doing this I would get another realtor.

As far as what you put down there should be a customary percentage for your
area. There is no need to put down more.

Couple of more realtor questions: How long has the house been on the
market? What is the typical time on the market for they level home you are
looking at.

One of the standard items you can put in the contract offer is that the
house must appraise at or above the offering price. This gives you an out
or renegotiation justification. If you will have a loan the bank will
require an appraisal. Soe banks actually have someone come out. Some do
nothing more than pull Comps. If you get a private licensed appraiser then
they work for you. You would get a written appraisal.

Especially being a first time buyer SPEND THE $ AND GET A HOME INSPECTION.
A satisfactory home inspection should be part of the contract offer. Be
there when they do the home inspection. They encourage it. They'll show you
the things they find (as well as a written report) and they'll teach you
stuff about houses.

Some states require a home inspector be licensed by the state. In some
states, believe it or not, any jabonee can set up shop and call themself a
home inspector. Either way, if you want a warm fuzzy on the quality of your
inspector get one that is a member of ASHI http:\\
www.ashi.org or NACHI
http://www.nachi.org

Everything has to be put in the offer. The offer may go back and forth a
few times but when it's accepted by buyer & seller, you can't add stuff
later.

Keep in mind that the commission of both the buy and selling realtors is
paid by the seller. Both realtors work for the seller (there are
exceptions) but they do have a code of ethics. Your realtor is not
necessairly out to put the screws to you.


This is not an an all inclusive home buying post. There are many things,
important things, not mentioned. If you have a family member or very good
friend who has done it a few times that can be invaluable.

Red...
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wrote:

I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.


Lot of unknowns that we can't make many specific suggestions.

First off, a house is worth what someone is willing to pay for it. The
realtor is saying it is underpriced already and he wants you to make an even
lower offer. There are two possible outcomes. The buyer may be desperate
and grab your offer. The buyer may think you are one cheap SOB trying to
steal a properly priced house and tell you to screw off and won't talk
anything less than the full listed price. If you are prepared to walk and
find another place, go with the low bid. If you are crazy about the place
and surely want to live there, offer very close to asking price.

Second, never trust a realtor. They make money on sales. He is working to
sell the house and any warm and fuzzy felling he has for you goes away after
the commissions are divvied up.

If you are pre-approved for a mortgage you have more bargaining power as the
seller will have confidence of a completed sale. He may be willing to go
lower compared to another buyer. When you get down to the end of
negotiations, don't let a $1000 difference blow the deal. In the scheme of
a 20 or 30 year mortgage, it is not worth the hassle.Makes for a better
closing and better relations with the seller. When a good deal goes down,
the seller often leaves a small gift or celebratory bottle of wine for the
new buyers. When a deal is bad, they remove the light bulbs and toilet paper
just to **** you off.

Do some research on other sales around and make you best offer.


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This is a good topic for misc.consumers.house.

Personally, I would avoid this agent like the plague. She still may
get a cut of the commission, but she is doing you no favors.

Giving a lot of earnest money does NOTHING to reach closing quickly.
All it does is lock you in. Do not give more earnest money than you
are prepared to kiss goodbye.

Una
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On Fri, 14 Mar 2008 17:25:20 -0700 (PDT), wrote:


I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.


If you are willing to offer 180 and go up to 190, and you take the
advice not to let 1000 get in the way (or maybe 2000) and you probably
will take that advice because once someone, almost anyone, has made up
his mind he wants something, it's hard to change his mind, so you will
almost certainly get the house.

So the first thing hyou have to decide is if you want it. Are you in
a hurry to buy? How many houses have you looked at. How many did you
like. How many did you like more than this one, less than this one.
When you describe it as in fair condition, is that only the amount of
work it needs? You haven't said you actually like the house, or that
you would like it a lot when it is fixed up. I don't know how many
choices you have in your price range, because I don't know where you
are.

Now my townhouse in suburban Baltimoire is probably worth 195 or 190
now, based on the postcards I get from one realtor telling me how much
houses in my n'hood sold for (and I verified this when my next door
n'bor sold (Here they have all the prices on the net, based on
address), and I like it a lot except for 3 of the neighbors. I don't
know how much more it would have cost me to buy a free-standing house
(I planned to get married and let my wife pick out the house) but I
think only 10, 20 or 30K. Not sure.



My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?




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On Mar 14, 7:55*pm, dpb wrote:
wrote:
I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.


I suppose he wouldn't since his commission is a percentage...

You _do_ have legal representation, right?

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.


In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?


Earnest money isn't required to make a bona fide offer of whatever level
you should choose. *That can be arranged during the negotiations as part
of the seller's acceptance/rejection process.

There are too many variables to be able to say anything at all other
than you're way too green going here -- you should at a minimum research
what other houses in the area have sold recently and for what price.
How long has this particular property been listed? *How long did
comparable properties take to sell?

W/O knowing anything at all about the area you're in, it's impossible
for anybody here to even hazard a guess as to how depressed the housing
market is there at whatever price range. *Some areas are in the dumper,
others have seen very little impact.

Do you think that I could demand lower than or around $180,000?


You can't "demand" anything -- you can make an offer of whatever you
choose and the broker has to tender it. *They can reject it outright,
counter-offer or accept. *Your move again.

Ever hear of Bruce Williams on evening talk radio? *He's great at
fleshing out the details and the pitfalls. *He's got a book altho I've
not seen it--if you can find the show, call and ask your questions--but
have a reasonably thick skin; he doesn't suffer fools easily! *

--

Wow, so many feedbacks with great insights..
This is certainly more than I expected. Thank you so much all of you
for sharing your thoughts on my somewhat 'vague' question..
I thought this group posting works like a thread that I could post my
message that everyone can see at the same time,
but doesn't seem that it works that way, so I'll just write up one
message and make it as reply for everyone who answered my question.

first of all, i think i somehow delivered negative impression on my
realtor (after revising the initial post, i kinda felt it and deleted
right away and posted another one after this, and there were some
people who already answered on my questions.. Thank you so much! )

My realtor is actually my friend since college.. I think he wouldn't
do anything fishy to take advantage over me or this situation.
He even let me use his search engine for realtors, so I could search
houses in my flavors - that website showed a lot more info that
wouldn't be available in the public, including the realtors' cut or
extra bonus upon closing certain houses - I tried not to pay attention
on those 'secretive' info since that was either none of my intention
or business..One thing I want to double check though is that even if
he wants to deliver best deal to me, what if he couldn't deliever it
due to his lack of knowledge or experience, OR the way he practices
isn't something that is widly accepted.. So, I decided to post a
question here before making any major move.

I've seen around 35 to 40 houses.. mostly town houses. (it is
difficult to buy a single house with under 200000 around the town I am
at)
The house came out is a Duplex (town house with two units) that I
don't have to pay association fee (which is attractive feature to me)
This house I am thinking about submitting proposal in fits my
situation in many aspects,
it is closer to my work than other houses that i've seen..(if i move
close to my work, houses become too expensive, difficult for me to
afford; if I move farther away,
I tend to get more square footage and newer and nicer houses, however
I will have to drive 3 to 4 extra miles)
also, there are many strip malls and stores nearby..if i go up further
north, there are more farm lands than stores..
I looked around the house today, and it was the house that was owned
by the original buyer for 17 years. My friend explained that
if one person owns a house for long time, we wouldn't find much update
or renovation inside and that sounded true. roofing appeared to be
fair condition though.
the house overall was neatly kept and clean. It didn't appear that it
requires any major work..

a month ago, there was a house came out a block away from this one I
am now interested.
The house was a second away to go through foreclosure..was taken by
bank, not the owner.
the price was $179900. The house was in really good shape (which was
hard to believe; a house in pre-foreclosure status was usually in very
bad shape, after few occassions of seeing several houses with big
holes in the wall and with ceiling falling down, this came as big
surprise) though the owner or someone took away refregerator and
washer and dryer..even with that the house seems so attractive with
its square footage and overall condition. My realtor pulled out CMA
report on that house and it was sold at $260000 2 or 3 years ago,
initially came out as $270000 a year and a half ago, and now it was
captivated by a bank and priced $179900.
I put my proposal in with 181000 with putting down $1000 as earnest
money. My friend was doubtful about this move since there was already
competition on that house (when we arrieved, there was already one
agent showing that house around and saw another family coming in
though it's been out only 5 days), earnest money is too little,
(according to my friend, banks wouldn't bother to review the offers
when a house that was captured is in good condition and earnest money
is too little, they would look for $5000 as minimum) Later I read this
artical which says that if you are going to put more than 3% as
downpayment, there is no reason not to put more for earnest money
because the amount of money stands out and make you as a serious buyer
and put you in better position on negotiation process. My question
was more like If $5000 large enough to make my position as committed
buyer when my purchasing property is about 200000, so a little more
than 2.5%.

My offer was rejected and later I was told from my friend that the
house is going through contract with another guy. (my friend told me
10 people including me made an offer and i don't know at how much it
was sold, my friend thinks it must be sold at way more than 180000,
probably over 200000).

Now, this house came out, from a block away, is priced 195000.
compared to the other one, the overall condition for this one is
worse. Still my friend thinks that this house is a bit under priced.
my friend sent me an email hours ago with the info of the houses in
the neighborhood which are still active in listing or the ones that
were sold in last 12 months. There were about 10 houses and mostly
were sold higher than this one or still priced more expensive than
195000, so I think my friend is right.
However, my concern is that what if this bear housing market's overall
discount rate wasn't really reflected on this neighborhood? I
overheard it is common pratice to buy a house with 5% discounted rate
when the market is OK. Right now, everyone knows that it is rock
bottom for housing industry and I was hoping maybe I could buy a house
with at least 10 to 15% discount.. I definitely want to take advantage
of this interest rate, thinking about wait until FRB's new rate cut,
which is expected on 18th this month..by making my rate float even
after making a offer. That's one of the reason why I want to put this
process an end asap.

wow, this is such a long email, as i was writing this reply, i was
able to sum up my situation and partially was able to answer my own
question..Overall, I guess doing this was worth it. Thank you so much
all of you for sharing your thought and reading this long message!



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On Fri, 14 Mar 2008 17:25:20 -0700 (PDT), wrote:


I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?



Of course! There are so many factors involved. If you can walk away
from the deal or you have this attitude, you have much more
negotiation power. If the seller needs to refinance soon or needs the
money desperately, you have a better chance at a lower price. About
1% earnest sounds right, but you need to ask the real estate agent.
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wrote:
I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.

My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.

In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.

well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?


It is a buyer's market. If a tract house, i.e there are a lot of similar
ones, ask to see the realtor's comps and only pay attention to the
recent ones as market is declining. If you are a qualified buyer, have
no property to sell first, and put up $5,000 you are in a very strong
position to put in the lowest possible offer. Also get an itemized list
of buying costs and property taxes and property transfer taxes. I hear
horror stories of high taxes in certain places.
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Default Need advice on home buying process, PLEASE HELP!

wrote:
....
My realtor is actually my friend since college.. I think he wouldn't
do anything fishy to take advantage over me or this situation.


Not to impugn your friend, but...

The point is it his job is to represent the seller, _NOT_ you. Friend
or no, you need somebody on your nickel who's fundamental and fiduciary
duty is to look out for _your_ interests to make sure you don't get
stuck w/ some hidden fault in a title, undisclosed defect, any of a
multitude of things that can (and do) go wrong...

....

the house overall was neatly kept and clean. It didn't appear that it
requires any major work..


Inspection? Who pays? If the seller, there's an incentive (and often a
sweetheart kickback deal) to let stuff go buy to close the sale...I
repeat, who's looking after _your_ side of the transaction?

....
...it was sold at $260000 2 or 3 years ago,
initially came out as $270000 a year and a half ago, and now it was
captivated by a bank and priced $179900.


What it sold for back then is almost immaterial to its value in the
market today...again, you need to be looking at what similar properties
in the same neighborhood of roughly same condition are _closing_ for
_NOW_ (or at least within 6-months to a year at the outside depending on
how fast stuff is moving). In a volatile market, historic prices are
just of no use in actually assessing value.

I put my proposal in with 181000 with putting down $1000 as earnest
money. My friend was doubtful about this move since there was already
competition on that house (when we arrieved, there was already one
agent showing that house around and saw another family coming in
though it's been out only 5 days), earnest money is too little,
(according to my friend, banks wouldn't bother to review the offers
when a house that was captured is in good condition and earnest money
is too little, they would look for $5000 as minimum) Later I read this
artical which says that if you are going to put more than 3% as
downpayment, there is no reason not to put more for earnest money
because the amount of money stands out and make you as a serious buyer
and put you in better position on negotiation process. My question
was more like If $5000 large enough to make my position as committed
buyer when my purchasing property is about 200000, so a little more
than 2.5%.


I think that article is bull**** -- dealing w/ a bank in foreclosure is
somewhat different than a homeowner, but the offer is required to be
submitted and the lender will look at the overall gain to them --
earnest money is a trifling amount and of really no value to them unless
the market is slow--on this particular property obviously there was a
lot of interest.

My offer was rejected and later I was told from my friend that the
house is going through contract with another guy. (my friend told me
10 people including me made an offer and i don't know at how much it
was sold, my friend thinks it must be sold at way more than 180000,
probably over 200000).


The offer was rejected because they got better offers, _not_ because of
lower earnest money.

This earnest money thing is a red herring. It could only possibly be of
major significance if you are not already qualified by a lender for the
size of mortgage you're going to need for the range of properties that
you're looking at and/or don't have the upfront cash besides. If you
are pre-qualified, you're earnest enough.

I again recommend highly you find Bruce Williams on the radio tonight or
his book and bone up on real estate purchasing in a hurry...

--
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Una Una is offline
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Default Need advice on home buying process, PLEASE HELP!

Byun.kevin, the realtor let you search the MLS for your area. In many
areas, you can do this free because many realtors offer online access to
it in exchange for minimal information about you.

On the MLS you can see general descriptions of houses and their prices.
(Selling prices if that is public info in your state; else only asking
prices.) But, from the list you generate on MLS you can pick 3 or 4
most comparable and have a licensed appraiser do a full comp workup.
Then, separately, you should get an inspection done by a licensed house
inspector. The appraiser works from the assumption that everything is
in good working order, meets code, and does not require repair. The
inspector looks at those issues.

Offer only as much earnest money as you feel comfortable losing. Make
the offer conditional on your own approval of appraisal and inspection
results. One strategy is to use the appraisal to set the initial price
then subtract for the cost of repairs of problems found by inspection.
To get those costs you ask the relevant trades (roofer etc) to look at
the house and give you a written estimate of the work to be done.

A house for sale should look like nothing is wrong, but this one has a
number of red flags. It is in foreclosure after being owned 17 years;
that could mean just 1 year of tight money, or many years, hence a lot
of deferred maintenance. A roof in (to you) "fair" condition suggests
deferred maintenance has been going on a long time.

Una



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Default Need advice on home buying process, PLEASE HELP!

On Mar 15, 8:45*am, Frank [email protected] wrote:
wrote:
I'm interested in buying a home in IL, first time home buyer.
There is a home came out as fair condition and is priced $195000.
My realtor said it is 'a bit under priced' didn't exactly mention how
much.


My realtor wants me to put as much earnest money as possible to get it
closed as quickly as possible.
He also believes that will help him for negotiation process.


In this market condition - I heard it is buyers market, what is the
reasonal amount for earnest money?
I was thinking that I can put $5000. *Should I put more or less?
Also, my realtor is thinking about making initial offer for $180,000,
expecting to close the deal
around $190,000. *My realtor explains that though it is buyers' market
and for some houses, those come out
as discounted as much as 20 - 30%, however that would be rare for the
housing market that I am interested in,
under $200,000. *In usual situation, I would agree with my realter
100%, however, in this given market condition, I'm not so sure,
feeling that I could demand lower price; however, on the other hand I
wouldn't want to scare off sellers that I'm getting a bit tired of
home buying process.


well, this pretty much sums up my situation.
Do you think that I could demand lower than or around $180,000?


It is a buyer's market. If a tract house, i.e there are a lot of similar
ones, ask to see the realtor's comps and only pay attention to the
recent ones as market is declining. If you are a qualified buyer, have
no property to sell first, and put up $5,000 you are in a very strong
position to put in the lowest possible offer. *Also get an itemized list
of buying costs and property taxes and property transfer taxes. *I hear
horror stories of high taxes in certain places.- Hide quoted text -

- Show quoted text -


I'd stop worrying about the earnest money as if it were the main
factor in someone accepting an offer. Are you pre-qualified for a
conventional mortgage with 20% down? Someone making an offer under
those conditions with $500 earnest money is going to impress me a lot
more than someone that puts more down, but wants to get a 5% down
mortgage. Or worse yet, someone that wants to make the purchase
contigent on them selling their own house.

You say the first deal was under priced according to the realtor
friend of yours. If you've looked at so many houses and have access
to his MLS data, you should know what similar houses have actually
sold for. Meaning you should also know if the house is priced right.

Make sure you have an inspection contigency in the contract and get a
reputable inspector. Usually, that winds up free, because most
inspections on an existing home will find enough squaks that you can
get then get the seller to agree to lower the price by an amount to
fix them. And that is what you should do, as opposed to having the
seller ffix them, because then you can control what's done. For
example, if there is a dishwasher and on the inspection it shows up as
leaking, I'd rather get a credit of a couple hundred bucks, then get
the new one of my choice.
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dpb dpb is offline
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Default Need advice on home buying process, PLEASE HELP!

wrote:
....
I'd stop worrying about the earnest money as if it were the main
factor in someone accepting an offer. Are you pre-qualified for a
conventional mortgage with 20% down? Someone making an offer under
those conditions with $500 earnest money is going to impress me a lot
more than someone that puts more down, but wants to get a 5% down
mortgage. Or worse yet, someone that wants to make the purchase
conti[n]gent on them selling their own house.

....

Note I'm commenting here to OP altho he seems to have left the scene,
it's just convenient to reiterate the point I've previously made

From the seller's viewpoint I couldn't agree more. OTOH, from OP's
viewpoint as a buyer, it could be absolutely _critical_ to have such a
contingency clause (altho in this case of a first-time buyer that's not
likely an issue).

_BUT_, it's only one example of the sort of thing that arises and the
reason OP should have somebody (preferably imo a legal-beagle) on his
nickel to ensure that this or whatever contingency it is that is
appropriate for his particular situation is addressed--and only that
person will be the one looking out for his interests in the transaction,
friend or no...

It's that competing issue of whose interests are at stake that the
particular example is good at illustrating that hopefully OP will read
(and take to heart altho I have my doubts of the latter even if the
former were to happen, unfortunately).

--
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