All Forum Posts by: Lakila Richardson

A good agent is going to know what it takes to win a bid. You are being beat out by all cash offers. A good agent will know how much you are going to need to bid over to make the seller take your offer. Maybe it is an escalation clause going a certain percentage above existing offers. Maybe it is using a certain lender whose preapproval letter carries more weight than other lenders. A good agent is also going to have a pretty good idea of how much the property will appraise for and thus know if you even can outbid the all cash offers. A good agent will know if the property will pass or come close to passing an FHA inspection.

A good agent is going to be able to tailor an offer to win (at some point, maybe not the first offer) if they know the market properly.

In my own market, I know what offers need to be made on what houses.  I know where I need to make an offer $100k over list price with no contingencies, or where I can make a lowball offer.  If the listing agent is from a certain brokerage, I know they are going to give more weight to preapproval letters from certain lenders.  I have a good rapport with many agents so I can talk candidly to them and find out what is going to get a deal done.

Do not under estimate the power and knowledge of a good agent.  If you do not have someone like this...then find someone. Also be prepared for the possibility that the agent will tell you things you might not want to hear, such as you have zero chance of acquiring a particular property. But then hopefully he is going to point you towards properties you can acquire.

@Lakila Richardson What you really need in this whole process is two things. A knowledgeable agent and a good lender.

Wayne is on the right track except that that a lender issues a "pre-approval" letter does not mean that the loan will be funded in all cases.  The pre-approval is still subject to meeting all underwriting guidelines and the property appraisal must be sufficient as well.  I presume you are planning to live in one of the units and rent it the other 3 units.  Your going to be competing with seasoned investors with no plans to occupy and the cash (of their own or from a private money lender + some of their own) who is looking to acquire the peppery for the cash flow,  appreciation, and depreciation that comes with it.  It's not impossible to win in this arena...but you've got your work cut out for you when relying on normal channels for acquisition capital.

The hesitancy about FHA isn't particularly the time, it's twofold; 1) The property condition must meet FHA standards, which are fairly stringent. 2) Any financed deal may fall through because the borrower may not actually qualify. To help alleviate this concern, make sure you have a True preapproval-having submitted 2 years of tax returns, last two bank statements, all debts revealed, etc-and have your lender specify that these have been specifically reviewed.