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1   FortWayne   2013 Oct 9, 4:06am  

That's very funny. There are always those ignorant pricks, who think highly of their "negotiating" skills, who want to do everything last minute without considering all the risks.

It's kind of entertaining to read about that stuff.

2   New Renter   2013 Oct 9, 5:54am  

Purchase money mortgages are sooo 2012.

In today's market its CASH or FUCK YOU AMERICA!

Everyone knows that!

3   myob   2013 Oct 9, 6:04am  

Here's how it worked for me.

1) I walked into a local office of a big bank to talk about home loans, since I have my pay deposited there and I've banked with them for years.

2) They requested a metric crap-ton of documentation, and qualified me for $X at Y%. (not pre-qualified, which is just a tentative promise).

3) I bid on several houses, all well below $X using a letter from my bank explaining how my loan is assured. I had them draft a separate letter for each bid with the max price being a round number very close to the house asking price, so that for example, someone selling an $1.2M house wouldn't see I was qualified to borrow $1.8M, which might make them get greedy. I left a little bit of upside, so for a house I bid on that cost $1.1M, I asked the letter to be drafted for $1.15M (and I was willing to bid up to this amount).

4) One offer was accepted, I called the bank, the money was ready in 10 days. Now, I had 20 days left to twiddle my thumbs for the remainder of the 30 day closing.

Here's the deal. You're borrowing an astounding amount of money to buy a house, especially in the bay area. Going with a well known lender who controls their own underwriting department buys you time and reliability. You know the money will be there once they've gone over all your papers. Typically, your loan rate might be a little bit higher than a discount loan broker, in my case, about 1/8% higher.

Now that I have the house and I have the fixed rate mortgage with no pre-payment penalties, I can sit on my butt and wait for a discount loan broker to do the best they can to refi this loan. I know that I will never pay more than my 30-yr fixed current loan, which I can afford. When you have time on your side to lock in a low interest rate, you can do much better than securing any initial loan during the closing period.

These silly games just cause ill will between buyers, sellers and agents. If you make it nice and smooth for everyone, they treat you better. For example, the sellers of my house had it professionally cleaned and left it in amazing shape, leaving behind a bunch of useful appliances which weren't in the contract. If you get on someone's bad side, they will do the bare minimum to satisfy the contract.

4   gregpfielding   2013 Oct 9, 6:09am  

myob says

These silly games just cause ill will between buyers, sellers and agents. If you make it nice and smooth for everyone, they treat you better. For example, the sellers of my house had it professionally cleaned and left it in amazing shape, leaving behind a bunch of useful appliances which weren't in the contract. If you get on someone's bad side, they will do the bare minimum to satisfy the contract.

So true.

5   FunTime   2013 Oct 9, 7:37am  

30*12*$36 = $12960!

This is a great illustration of how the amount of money on the line when buying a house has resulted in a confounding experience full of people wanting a piece.

Is the moral of the story, "Just play along because this is how it works if you want to buy a house?" There will be fees. Other people will make as much money as they can hide in a very long, confusing contract. Bankers make more money than you, didn't you know? Who are you to question how this works? You're the one screwing up, because you're not playing along. Conform!

6   gregpfielding   2013 Oct 9, 7:54am  

FunTime says

You're the one screwing up, because you're not playing along. Conform!

I have no issues with a buyer or seller negotiating lower commissions with their real estate agent or mortgage broker. The issues in my illustration are the problems caused by continuing to fight for even more throughout the deal, and blaming other people for your mistakes.

What looks like a better deal in the beginning often isn't by the end. Negotiate if you want to, but then pick your agent and lender and respect them as your partners, not your adversaries. You'll get much better results.

7   FunTime   2013 Oct 9, 8:04am  

gregpfielding says

You'll get much better results.

That makes sense. The whole process seems so depraved that there can be no positive outcome.

8   FunTime   2013 Oct 9, 8:06am  

Or maybe a more helpful statement to write is that I wish the process were improved and more transparent. I suspect it is an even worse experience than buying a car.

9   RWSGFY   2013 Oct 9, 11:53am  

So the guy got the house for the price he wanted and agent's commission got smaller in process? Apart from $36 per month increase of the monthly payment (which can be remedied later by refinancing) what is the problem again? Realtard should be grateful his face wasn't eaten!

10   HEY YOU   2013 Oct 9, 2:58pm  

It's always nice to hear stories about the different tactics people use to overpay for overpriced houses.

11   FortWayne   2013 Oct 10, 12:52am  

FunTime says

You're the one screwing up, because you're not playing along. Conform!

If you want to borrow a lot of money last minute that's asking for trouble. Be prudent, figure out the money situation up front.... or you know where you'll have to stick it.

12   gregpfielding   2013 Oct 11, 8:19am  

FunTime says

Or maybe a more helpful statement to write is that I wish the process were improved and more transparent. I suspect it is an even worse experience than buying a car.

Transparency isn't the issue here. It's that buyers really are better off spending more time working with their lender before writing offers so there are no surprises.

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