Peggy Henward’s Real Estate Blog

You have found the perfect house with everything you wanted, but the price is more than you want to pay. You decide to ask the agent to submit what Realtors call a “low ball” offer.

If the market is fluctuating and the sellers are anxious, they may just go for an offer that is a little lower than the original price they are asking. If the house is listed at a price that may be too high and they haven’t had many offers, the sellers may be more than willing to negotiate. Most sellers are open to reasonable offers, and especially if the asking price is in line with recent sales of similar homes.

Negotiating for the right price can be a creative and artful process. But if you really want the house, a very low initial offer may offend the seller to the point that he or she won’t counter-offer. Design your strategy on the basis of how badly you want the house and follow the expert advice of a Realtor whom you can trust.

You found a house that seems perfect?  The asking price is reasonable, and you really love the home’s location and amenities.  If you are like many buyers, you can’t resist bargaining, so you initiate negotiations by asking the Realtor if the sellers will take less for the home than they are asking.

A real estate agent doesn’t know what price and terms the seller will agree to.  The sellers often don’t know themselves until they must consider an offer.  In many cases, the price is negotiable, but the only way to find out is to make the sellers an initial offer.  Attractive, well-priced homes usually sell quickly in any market, and you may need to big aggressively.  If it would break your heart to lose a home you really love, you should be willing to pay the asking price if the sellers reject a low offer.  In some cases, it may be necessary to bid more than the asking price, particularly when there is strong competition from other buyers.

Escrow rules have become more consumer friendly thanks to new accounting rules set forth by the Department of Housing and Urban Development (HUD).  Lenders use the escrow accounts to accumulate money from the borrower on a monthly basis to ensure the timely payment of property taxes, insurance premiums, and other recurring expen- ses.  This money is in addition to the regular principal and interest mortgage payments.  At the end of the year many borrowers were discovering that they had contributed more money than was necessary to meet the annual cost of these additional expenses.  The new accounting rules prescribe that a borrower cannot be charged more than one-twelfth of the combined taxes, premiums, and other recurring expenses per month.  The lender is allowed to accumulate a borrower’s payments up to a two-month advance cushion at the end of a year.  But if a surplus develops beyond this amount, the borrower is now entitled to an immediate refund unless the surplus is less than $50.  These rules apply to new loans.