Bank Qualifying Letter: REO Properties

[Michael Glaser]

I have a few REO properties I'm going to be putting offers in on tomorrow. I'll be getting some qualifying letters from the bank I work with on each. My question is, for negotiation purposes, is it best to get a qualifying letter in the exact amount of your offer? Is it better to leave some wiggle room in there?

For example:

If you're offering on an REO that's asking $50K. Your offer is $40K. Is it best to get the qualifying letter at $40? $42? $45? $50?

My thought is if you have one showing $50 the bank would just think "Well he can afford asking, so we'll stay at asking."

[Wayne Brooks]

Have it written for the Maximum you can qualify. No seller wants someone who can barely, maybe, qualify for the loan.....they'd rather have someone they have confidence in. I have buyers who show $400k cash POF's when offering on $150k properties. The worry about "they will know I have more" is just silly. BTW, do you have a legit lender that will actually lend less than $50k?