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How to negotiate the best deal
About to buy property in America? Pat Tan, a Florida-based realtor, provides some key points on playing hardball on price
A key point in negotiating the best deal is to understand the motivation of the seller. Your realtor should help you structure your offer to meet the sellers' needs, which may not necessarily be financial.
The best deal today may not necessarily be a foreclosure (a bank-owned property) or short sale (when the seller owes more on the property's mortgage than the value of the property in today's market). Foreclosures can be a good deal but buyers should be prepared to put some money back into reinstating the property.
Short sales must be approved by the lender and the time frame to actualise the bank's decision could take anywhere from 30 days to six months. It is a lengthy process that may or may not warrant a 'deal', let alone an approved contract for the buyer. A seller who is not in financial hardship but has his/her property priced correctly in today's market can often be the better alternative.
A cash buyer in today's market is the most coveted and can usually drive the hardest bargain.
Understand all the costs and potential pitfalls associated with the transaction. These can include, but are not limited to, mortgage application fees, documentary stamps, taxes, home owner association or condominium association fees, property insurance, surveys, home inspections, title insurance, and property disclosures.
In particular, purchasing a foreclosure may have additional costs as opposed to a regular property transaction.
Be aware that most negotiations are conducted in writing. Be very careful when drafting your offer to ensure that any conditions are included, for it is difficult to include additional things in an offer once has been accepted.
Most contracts are drafted by a licensed real estate agent but can be reviewed or drafted by an attorney.
For further information: Patricia Tan
The May 2009 issue of Emigrate magazine features a bargain-hunters guide to several US states
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