Profile picture for Pastryprincess

3 Houses down ... what are we doing wrong

First time home buyers here We've bid and lost out on 3 houses. all 3 times we bid the asking price  plus abou 3% above for seller concessions. r mortgage broker assures us we'll get the mortgage easily as we are looking will below our comfort range even though we are only putting 5% down... What are we doing wrong?
  • April 26 2010 - Freehold Township
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Answers (6)

Profile picture for Bob Meauxvv
May I ask just out of curiosity, how do you know what the house appraised for if you lost out on each bid? I've heard from a buyer recently that her mortgage person gave her an appraisal from his desk.
  • May 07 2010
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If you're getting out bid then your agent is not doing his job. He should be running comparison's on other like houses that have sold in this area. Then he should be guiding you as to the correct offer to make, that's part of his job as a customer service professional.

One more thing about offering over the list price of the home, It has to appraise for the value of the accepted offer. Example: You offer $400,000 on a property with a $10,000 seller's concession...the property has to appraise for the $400,000 (not $390,000). Some of the properties you got out bid on may not appraise, so don't look back, just keep looking ahead. Make sure your agent is doing his job. Good Luck.
JOE
  • May 02 2010
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I do not think you are doing anything wrong except for the fact you are bidding asking price on homes that are appraising much higher than asking price. This tells me that there are other buyers who know the value of the homes they are bidding on. Some homes are listed at the lowest price in an area so they get offers in to sell quickly. I have done this myself, when this is done in a good area it leads to multiple offers driving the selling price above the listing price. The best way to get a price to offer is to get your agent to run a C.M.A. on the house to get its true value and that way you can get a idea if the home will go over asking price.
The example you used you said the bank appraised at 285,000 that appraisal is based on present market value of the home. That means you where offering $121,000 below market value. Someone knowing the market value of the home could offer $21,000 more and still have instant equity of $100,000. Not bad in todays market.
  • April 26 2010
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Profile picture for Pastryprincess
@ wetdawgs: he houses we have bid on have all appraised for higher then the bids. The area we live in hit seriously depressed by the hoursing market crash. Case in point the last home we bid on appraised at 285,000 by our mortgage company. The sellers were asking 168,900



@Mr Festa: Yes we are
  • April 26 2010
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Profile picture for wetdawgs
If you are bidding with seller concessions, even if it is above the asking price, the challenge is the house must appraise at that 103% value.  Therefore, a 100% offer with no seller concessions is more attractive than a 103% offer with seller concessions.    Drop the seller concessions in the next offer.
  • April 26 2010
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Pastryprincess: Are you working with a Realtor? If not, that could be it. Regards,
  • April 26 2010
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