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Mr. and Mrs. Seller, Broker Bryant is "fine tuning" for you!

By Bryant Tutas

Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

June 04, 2007 08:16 AM

Recently, I have "fine tuning" my negotiating techniques and have implemented the use of a "Buyer's Disclosure Statement" (BDS), prior to my Sellers negotiating on a purchase offer. It's a pretty simple one page questionnaire that the Buyer needs to complete. The purpose of the BDS is to give my Seller a better idea about the Buyer's qualifications, to close on the transaction, if we do come to an agreement.

So far, the response has been unanimous, I never hear back from the Buyer's agent again! I just sent it out for the third time, today, so I am anxiously waiting to see if I get a response this time. I figure if they don't respond then I've saved my Seller about 30 days of off market time.

It really is a simple form and I'm certain a truly qualified Buyer would have no problem answering the following questions.

1. PERSONAL RESIDENCE STATUS

Do you currently RENT or OWN your existing residence?

Have you ever owned a home before?

lf you own a home, is it currently for sale?

lf you own a home, must you sell it to qualify for a new loan?

Are you buying this new property as YOUR PRIMARY RESIDENCE or as AN INVESTMENT PROPERTY?

When purchasing a condominium, town home or single family home in a PUD (Planned Community), are you aware there may be periodic fees payable to the association for common areas, services and/or reserves?

2. FINANCING

Have you made application with a lending institution or mortgage company yet? lf YES, what's the name of the firm? Loan Officer Telephone umber? Do we have permission to contact the Loan Officer?

Have you been Pre-Qualified? Pre-Approved? Approved?

Can you provided documentation for any of the "YES" answers above?

Do you know the difference between the three possibilities above?

Have you calculated the total amount of funds that will be required for your purchase (i.e, down payment) plus closing costs and pre-payments)? Can you provide proof of funds?

Have you ever filed for bankruptcy? If YES, when? Have you ever had delinquent payments on loans or credit cards?

Can you provide the credit scores from your credit report?

Are there any past, existing or threatened legal action( i.e., divorce, collections judgments, etc.) against you that would prohibit you from purchasing a home?

Are you aware that the funds you will bring to closing must be in the form of a cashiers check or official bank check?

3. OTHER MATTERS

Is there anything else that you feel should be disclosed to a Seller that may adversely affect your ability to purchase a home? If YES, explain:

So here's my question. If you were working with a Buyer, would you have a problem with them answering these questions? My reason for using it is, I'm just sick and tired of getting worthless pre-qualification and pre-approval letters and feel this form will help weed out unqualified Buyers. Maybe. What do you think?

***Broker Bryant image compliments of Ines Garcia and Chris Elizabeth Griffith Thanks again Ines and Chris!

Don't forget to enter the "Broker Bryant Image Contest". The deadline is June 15^th.

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Steve Conklin - Iroquois County IL, Realtor®

none - Danforth, IL

lots of comments, hopefully I don't say anything redundant:

I like your questionaire :)
it looks A LOT like the questionaire that the investment group I used to belong to asked every single buyer. By the time we were done asking those few questions, we knew who was serious and who was uhhh...pulling our leg. Saved a lot of time and things always seemed to go smoother at the closing table :)

I always found that a little bit of raport went a long way BEFORE asking such personal questions. Build trust, get them to like you before getting personal about their finances. AND...I believe that you are right....any qualified or serious buyer will not have a problem answering questions like that.

I think you have the right idea with this questionaire! :)

Jun 04, 2007 01:21 PM

Jeff Dowler, CRS

eXp Realty of California, Inc. - Carlsbad, CA

The Southern California Relocation Dude

Sounds like a great idea, BB. In our contract the buyers HAVE to provide proof of funds within 7 days (time period MAY be negotiated), adn some other issues you raise are also covered. But having the info up front with the written offer could save a lot of time and aggravation. Great job...and my, you are looking in the peak of good health! :)

Jeff

Jun 04, 2007 01:33 PM

Bob Carney

Taylor-Made Deep Creek Vacations & Sales - Mc Henry, MD

Licensed MD/PA Real Estate Agent

I think it's a great letter. The Lender letters are the key. I want to see something solid, verified income, tri-merger report and verified funds. Some of the letters out there, you can print off the lender's website...I can write a more compelling "qualifications" letter. If I don't feel comfortable with the lender, I let my seller know that we need to encourage the buyer to see one of my proven lenders or at least a local established lender. I have lender's that will look at the buyer's info and tell me if they will make it to closing or not. (even if they don't get the business) I don't like surprises...surprises cost money and time.

Jun 04, 2007 02:01 PM

Joan Mirantz

Homequest Real Estate - Concord, NH

Realtor, GRI, CBR, SRES - Concord New Hampshire

I wouldn't have a problem with this at all because I always prequalify my Buyers so that no-ones time is wasted. I also disclose up front if there is a property to sell.

Jun 04, 2007 02:41 PM

Ana Connell

G & C Properties - Burbank, CA

Burbank Real Estate Agent

Great information, if you don't mind I'd like to use it! Thank you!

Jun 04, 2007 02:54 PM

Anonymous

Norm Fisher

Hmmm. Three interested buyers, three Buyer Disclosure Statements, no offers. I would say that if it keeps working like this it's probably not a good idea. :) Certainly worth a go though. Are there actually that many fall throughs in your market?

You're working out too much. Your head is starting to look a little small.

Jun 04, 2007 04:29 PM

#30

Lisa Hill

Florida Property Experts - Daytona Beach, FL

Daytona Beach Real Estate

I'm late coming in on this topic. It looks like all the good answers are already covered, so I'll just say BB is lookin HOT!

Jun 04, 2007 04:35 PM

Anonymous

The Lovely Not Signed In :)

Blog Boy...

Can your body double come out and play? :)

TLW...ROAR!

Jun 04, 2007 04:35 PM

#32

Miriam Bernstei

Rochester, NY

Nice concept but not in the New York metropolitan area, no way, no how. I personally would not fill that out either. Much to much information given to someone I have never met. Permission to call a loan officer and credit scores. Maybe. This works both ways. I have sellers who did not disclose what a buyer needs to know as well. Does your seller/you provide financial information such as any pending foreclosures? is there a divorce in the works that might hold up the closing, have you gotten all your permits in order? Can you document that? And I want to know before I proceed with the negotiations! Works both ways.

Jun 04, 2007 09:46 PM

Tim Maitski

Atlanta Communities Real Estate Brokerage - Atlanta, GA

Truth, Excellence and a Good Deal

I think that a nice letter explaining why you are asking for all of this would be very helpful to include with this form. If there are many homes to chose from, I might just move on to another one because my first impression would be that this seller might be very difficult to negotiate with.

Jun 05, 2007 12:03 AM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Tim, That has crossed my mind. But I tell you I have so many deals kick due to buyers and LOs not being honest. Plus the ones I have used it on so far are 100% deals with the seller paying closing costs. They have zero money and expect the seller to just take their property off the market while they "work things out".

Miriam, Actually my sellers do disclose all of those things prior to negotiating. It's part of the Property disclosure. Including legal actions, permits etc....

TLW, What do you need that wimp for? When you have the real think. I could look like that if I wanted to:)

Thanks Lisa. Thanks for stopping by.

Norm, In my market it's like pulling teeth getting a deal closed. No one has money, rarely do they have decent credit. I've lost 9 deals since March. Very frustrating.

Jun 05, 2007 12:43 AM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Lenn, I think it all depends on the presentation. That's going to be the biggest problem I'll have with this and may be a reason it won't work. I have to depend on the BA presenting it and getting it signed. Heck they can't even fill in a purchase contract. My entire market is just sooo frustrating.

Ana, Of course you can use it.

Joan, I can tell you are good at what you do.

Bob, I received a prequal yesterday and it wasn't even on a letterhead! I have to figure out something that works. Waaay too many deals falling through. I hate being at the mercy of the BA.

Jun 05, 2007 12:50 AM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Hi Jeff, Sounds like you have a pretty comprehensive contract. I hope this form will help. We'll see.

Steve, I agree it has to be presented properly. And that's the biggest issue I am having since I'm not the one doing the presenting.

Cheryl, You are correct as usual:)

Monika and Jay, If I received a solid approval and a purchase offer that was complete I wouldn't need this form. But unfortunately that's a rare occasion.

Sharon, I agree. As Lenn had pointed out it will also give my seller more ammo if we need to claim the deposit.

Desiree, I am certainly buying all that. Presentation is everything. Make me feel warm and fuzzy and this form goes away:)

Maggie, IF I worked with Buyers this form would be excellent for the preliminary interview before sticking them in my car.

Jun 05, 2007 01:01 AM

Judy Cicalese

William Raveis Real Estate - New Canaan, CT

Market Knowledge-Social Media Savvy 203-638-7812

I think it could be used for certain buyers if I didn't feel comfortable with the offer - however, luckily I have not had to go this far, but if you don't mind I'll make a copy for future use (if that's OK with you).

Jun 05, 2007 11:00 AM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Judy, It's yours to use if you choose to.

Jun 05, 2007 11:31 AM

Irina Netchaev

Pasadena Views Real Estate Team, Inc. - Pasadena, CA

Pasadena CA Real Estate

Bryant, love the new look! Intersting concept... I've never had anyone in my area, Pasadena California, present me with a form like that for my buyer. As a listing agent, I can see that as a great tool. Although, I'd want to think this through... I think it might turn some of the buyer's agents off in our market. I also wonder how many buyers would consider a form like that an invasion of their privacy if they're already providing a strong pre-approval letter.

Again, interesting idea... you always come up with innovations for us. :-)

Jun 05, 2007 03:19 PM

Rick & Ines - Miami Beach Real Estate

Majestic Properties - Miami Beach, FL

Bryant - I would not have a problem siting down with my buyer to fill this out - but I can see some buyers having issues with it. I think it would depend who is asking for the information. If it is a reputable agent in town, I would explain that to the buyers, if not, they would most likely move on. (btw - this image was also a team effort with Chris Griffith - she provided the image and I made the changes)....and I will add, you sure look good!

Jun 05, 2007 03:21 PM

Miriam Bernstei

Rochester, NY

In New York our Seller's don't for the most part complete the seller's disclosure and if they do it does not divulge financial information about the seller. Just about the house. So if a divorce is imminent or a foreclosure you can be surprised at the closing. It works both ways up here.

Jun 05, 2007 11:17 PM

Bryant Tutas

Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL

Selling Florida one home at a time

Irina, I f the buyer presented a strong offer with a good preapproval letter and had some money in the deal and I wouldn't need them to complete this form. The one I had sent out a couple of days ago the offer came in with 100% financing the seller paying all the closing costs, no deposit and a prequal letter from a MB that works independently from her house and doesn't speak English. That's what most of my offers look like.

Hi Ines, I love that picture!! My comment to Irina applies here as well.

Miriam I'm surprised they don't have to disclose any legal actions pending. That certainly affects the value of the property. The NY market is very unique!!!

Jun 06, 2007 12:48 AM

Virginia Cunningham

Keller Williams Coastal Properties - Long Beach, CA

In theory, I love the questionaire. I know that I've had buyers as clients that probably would be offended by having to fill it out. It may speak to the average selling price in my area ($750K) and whether they are new to the home buying process.

In CA as the listing agent, I always ask for a copy of the deposit check, proof of funds to close, middle fico scores shown on the first page of the credit report or supplied by the lender and a pre-approval letter from the lender along with the offer. I speak to the lender to find out if it is actually a pre-qual or pre-approval. If the buyer has a home to sell, I ask to see a copy of the listing agreement. If the home is in escrow, I get a copy of the escrow instructions. All prior to presenting the offer. I would not take the disclosure as seriously as proof from a third party. If I am representing the buyer, I have prepped them ahead of time that they will need to have these documents ready to go along with the offer.

It's not real common here to do that, but the good agents always do it.

Jun 08, 2007 11:07 AM