Are you a buyer who thinks they have found your dream home, just to find out that there are 10 - 15 other buyers thinking the same thing?  And you have submitted an offer to "the Bank" and yours' has been rejected?  Are you getting frustrated?  Don't give up!                    

The real estate market in the Elk Grove area and the greater Sacramento area has shifted again....the banks are pricing their inventory very aggressively and we are seeing multiple offers on most homes. 

HOW DO YOU GET YOUR OFFER ACCEPTED BY THE BANK??? 

Here are a few tips to help you get your offer ACCEPTED by the Bank.

1.  It is important to understand that you will probably be 1 of 6 or more offers on the property.  You must have your agent write as clean of an offer as possible.  You also cannot rely on the bank countering all of the offers, so make sure you go in with your HIGHEST AND BEST offer to begin with.  Both agents and buyers are getting frustrated because they didn't get a counter offer and were willing to go higher on their price.  Understand that no one knows that but you and the bank does not want to waste valuable time countering everyone if they have received an acceptable offer to begin with.

2.  Understand that "As Is" means AS IS.  Don't ask for repairs to be done.  The banks will make little to NO REPAIRS.  If there are missing appliances in the home, they will not replace the appliances; you are purchasing the property without appliances.  This has already been taken into account on the pricing of the home also, both by the agents completing their BPO's (Broker's Price Opinion) and the appraiser.  If the carpet is stained, the bank will not clean it; if the walls need painting, the bank will not have them painted; if the pool is green, you will be paying to have it cleaned after close of escrow.   One exception I have seen recently, was a bank replacing the pool equipment prior to close of escrow, but it had been stolen during the escrow period, NOT prior to the buyer writing the offer on the property.

3.  Your earnest money deposit should be at least 1% of the purchase price.  Anything less will invite a counter offer from the bank even if your offer is the highest.   Then make sure your deposit gets into escrow within the time frame on the contract.

4.  If the bank is requiring you be preapproved with a certain lender, call and get preapproved immediately with that lender.  Having your agent call the listing agent and argue because you have already been preapproved with XYZ Mortgage Company, does not do any good and only causes delays in your offer being submitted.  Understand that this is not the listing agent's requirement, but the bank's and the banks that require this - Countrywide, Wells Fargo, IndyMac, etc. - will not review your offer until the listing agent also has the preapproval from their lender.  Also using their lender for the loan may help you get your offer accepted.  I have seen an offer be accepted for a first time home buyer that was using the bank's lender when a cash offer was made for the same price.

5,  Keep your closing time to 30 days if you are doing a loan and less than 20 days if you are purchasing with cash.  And then stay on top of things with your lender and don't allow them to go over the time period for closing.  If you ask for an extension of time for the closing, be expecting to pay a per diem cost to the bank; some of the per diem costs run as much as $150 per day.

6.  If you are a first time homebuyer and need assistance with closing costs, etc. make sure not to ask for more than you need.  The bank is much more concerned with their "net" not the sales price.  For instance, an offer at $300,000 with no closing cost credits would beat an offer of $305,000 with 3% or $9150 in closing costs credit. 

7.  We are seeing banks price their new listings at 5% to 10% below current market value or the last sale in the neighborhood, so when you place an offer on a property, make sure that your agent runs comparable listings for you so that you can offer your Highest and Best offer. 

And last, make sure that you know about the bank owned/REO listings as soon as they come on the market.  Sign up today to receive daily email notifications of the REO listings.  Contact Lori Mode, to register for these email notifications.

For more information on how to purchase Bank Owned/REO properties:

For part 1 - Buying a Bank Owned home

For part 2 - Buying a Bank Owned home

For part 3 - Buying a Bank Owned home

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Lori Mode and Bruce Durham, Keller Williams, Elk Grove

                  www.AllElkGroveHomes.com