Page 29 - How To Buy A Home In Louisville

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Making An Offer (Continued)

You might pay the list price or higher if…

■ The house is worth the asking price. It’s OK to pay the asking price or more when the house is worth what the
sellers are asking based on the data you reviewed.
■ The house is a new construction build. Builders don’t negotiate on price unless you want them to take out
some of the options.
■ Many sellers who have lived in a property for over 20 years feel emotionally attached to it and rarely accept
less than list price. Many times they feel insulted by low offers because of their memories in the house.
■ The sellers have always done business as, “This is the price, take it or leave it.” It is hard to change a mindset
like this. But if their “bottom line” is well below the price of other homes in the neighborhood, it’s still a good
buy for you. The seller is paying the closing costs for both you and them. The seller can pay your closing
costs. You do not have to have money for a down payment or closing costs. However, there are advantages
to paying your own. You should talk to your lending officer, also known as your mortgage loan officer. If you
want the seller to pay your closing costs for you, add it to your offer price. Most of the time the seller expects
a full listing price or more than list price to be able to afford paying your closing costs and their own costs. If
the house is listed at $100,000 and the sellers are willing to accept an offer of $96,000 but you want them to
pay your closing costs of $4,000, then you’ll probably need to offer them the full $100,000.
■ The house just came on the market this week and they’ve had many showings. If they get a low offer in the
first week or two, the seller will probably wait for a better offer rather than take a low one.
■ The sellers are not motivated. They are only moving because they want a bigger house, or are ready to move
from a two-story big house to a smaller patio home. They might also wait for a better offer since they have
the luxury of time.
■ They just bought the house last year, and the list price barely covers the cost of paying off the loan and the
cost of selling it. Anything less than this price and the seller loses money. They intentionally priced it lower
than other houses in the area so that it will sell quickly.
■ A new house has carpet included in the price, or have asked for hardwood floors instead.
■ There is a bidding war. We often times see that when a great house comes on the market at such a good price
that many buyers are interested in that house and they all make offers at the same time. This happens most
frequently after open houses, where many buyers see the house simultaneously. In this situation, you might
not have a chance to counter-offer and negotiate, so make your best offer up front, list price or higher. If the
house is worth the money and you love it, you need to state your offer up front because you might not have a
second chance.
■ You ask the seller to pay closing costs. Some loans, like FHA loans, allow the seller to pay 6% of the sales
price for your closing costs, but after paying their own sales costs and loan payoff, they might be losing a lot
of money. You can negotiate a price above the list price that covers all the costs and paying off the loan. This
is common, and an appraiser will tell the bank whether or not the house is worth the higher price.

The River Valley Realty Group - How to Buy a Home in Louisville, Kentucky 27