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First, are you approved for a mortgage in the amount of $155,000 or for a home purchase in that amount. If you have been approved for a $155,000 mortgage, that means that you can probably buy a house worth at least 10 percent more. Most lenders will lend you up to 90 percent of the purchase price; check this out with your lender to make sure you understand exactly what you have been qualified to purchase.

Second, you used the words “my RELTOR.” Is the real estate agent or broker really your agent? Have you signed a “buyer broker” arrangement with him or her? If not, it is important you keep in mind that the broker really represents the seller. If the broker knows your mortgage limit, he/she is duty bound to disclose that information to the seller.

Thus, whether or not he is your agent, I strongly suggest that you keep silent on your mortgage availability. You should also not divulge to anyone (other than your family or your lawyer) what your top price will be.

In answer to your question, as this column has suggested on many occasions, everything in real estate is negotiable. Don’t be afraid of making a low offer. The real estate agent is obligated to transmit your offer — regardless of amount — to the seller.

The seller has three choices:

  1. your offer can be accepted, in which case you have a contract;
  2. your offer can be rejected in its entirety. In this case, you can either make a new — higher — offer or walk away from this house; or
  3. your offer can be counter-offered. This means that the seller is rejecting your proposal, but is putting a new offer on the table. Keep in mind that if you receive a counter-offer, you then have the same three alternatives just described.

Let’s look at the following example: the seller is asking $159,000 for the house. You prepare a written offer in the amount of $147,500. The real estate agent submits it to the seller, who in turn counters for $154,750. The ball then goes back to your court.

How much do you really want to pay for your new home? Is this property really worth $154,750? Should you try to make another — lower — offer or should you accept the seller’s proposal? These are questions only you can answer.

However, by reducing the price, the seller has sent you a signal. The price is negotiable. If this is the house you really must have, accept the counteroffer. But, as you know, there are many other houses out there, and if you are prepared to continue shopping around if you lose this house, I recommend you make yet another counter-offer — this time in the amount of $151,750.

The negotiations will continue until someone takes a hard-line position and “draws a line in the sand.” One of you will ultimately say “this is my final offer; take it or leave it.”

It should also be noted that price is but one of the many items of negotiation in a real estate transaction. Often, a seller may be more interested in the timing of the settlement than in the price. For example, does the seller have to sell immediately and are you prepared to settle quickly. I have negotiated many a deal whereby purchasers received a very favorable sales price because they were prepared to go to settlement just 10 days after the contract was signed. Of course, we all know that lenders cannot approve a loan in such a short time, but it you are able to come up with all cash, that’s one possibility.

On the other hand, some sellers may want to stay in the house for several more months. Are you prepared to wait? Are you prepared to purchase the house now — so as to preserve a favorable mortgage interest rate and begin to get the tax benefits of homeownership — but allow the seller to stay in your new house on a “post occupancy agreement” arrangement? In effect, you purchase the house and the sellers pay you rent until they move out.

Another important factor to consider is whether the seller is willing to take back financing — either for the full amount of the purchase price or a small second trust. This is an issue which should be explored with the seller before you make an offer; once a sales contract is entered into, it may be too late to try to renegotiate that contract.

In the final analysis, once you have decided to purchase your new home — and have zeroed in on the neighborhood you want — don’t be pressured into buying a home. Shop around, check prices, and negotiate everything.



About National Realty Group

National Realty Group was founded in October 1991 by Jeff Maas. It started as a two man office but soon grew to a medium sized office. One of the original agents formed a new home development company soon after. Steven Walker Homes is now a large national home builder. Southfork Mortgage Company Corp. was founded in April 1990 by the owner of a large home builder. Jeff Maas stepped in as its Broker in September 1993. With the help of Jeff Evens, Jeff Maas was able to expand the company. In July 1994, the owner of Southfork retired and Jeff Maas and Jeff Evens purchased the company. They continued the growth and soon built it into a multi-million dollar corporation. National Realty Group remained separate until Jeff Maas sold it to Southfork Mortgage in 1996. This allowed the owners to expand National Realty Group while allowing its agents to provide mortgage services to their clients. In 1996, a branch office of Southfork and NRG was opened in San Bernardino. It was later moved to Redlands in the most well-known office in the city. In 1998, they opened an office in Temecula in the Temecula Valley Bank office. The offices were expanded and closed 45 million in real estate and loan transactions in 1998. In 1999, Jeff Maas purchased the company from Jeff Evens becoming sole owner and broker. Shortly after the name was changed to National One Mortgage Corp. The company outgrew its 3000 square foot office in Riversideand moved to a building of approximately 6000 square feet. The growth continued at a spectacular rate. The company grew to over 40 agents within one year. The expansion continued with the addition of 2800 square feet and later adding more space for a combined total of nearly 13,000 square feet. At our peak we had over 125 agents and 12 employees in the Riverside office alone. During the summer of 2003, we opened an office in Temecula at the corner of Rancho California and Margarita. This office was soon bursting at the seams with 42 agents and 3 full time employees. Due to the increased demand for our unique programs, by the public and real estate agents, offices were opened in Corona and Ontario in early 2005. The year saw more amazing growth with offices opening in Moreno Valley, Hemet, Las Vegas and Norco. Rancho Cucamonga and Phoenix opened the first part of 2006. A Murrieta office opened summer of 2007. The economy has not been kind to many real estate and mortgage companies. We have remained strong and successful. Our business model of a One-Stop Shop provides the exact service and convenience the Home-Buying public desires and needs.


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