Home Buying in Phoenix>Question Details

Boolean, Home Buyer in Phoenix, AZ

In this market, what are the chances of an offer being accepted with 10-15% down payment?

Asked by Boolean, Phoenix, AZ Sun Dec 30, 2012

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Stephanie Weiss’ answer
Many buyers put 10-15% down. Most sellers will not be too concerned provided you have a Loan Status Report (LSR) completed & signed by a verifiable lender. That being said, depending on what price range you're buying in and what area, you could be competing with cash buyers. That's when it will most likely impact whether your offer is accepted. All the best!
0 votes Thank Flag Link Tue Jan 1, 2013
Earlier last year the market was boiling a little more than it is now and you would line up your offers in order of strength. Of course cash is always king and if you are dealing with multiple offers then the more money down the better. Our more recent experience has shown that a good solid offer that is close to a fair listing price has a good chance of being accepted. We are starting off 2013 with a slightly flat market so your offer will be solid if presented correctly. Good luck!
1 vote Thank Flag Link Tue Jan 1, 2013
It isn't just the down payment that a seller looks at. Are you competing against cash buyers or FHA and conventional buyers? Is your agent having the lender call the listing agent and letting them know how well you are qualified for the home? It sounds simple but that phone call could be the difference between getting a home or sitting on the sidelines.
0 votes Thank Flag Link Thu Feb 7, 2013
Hi Boolean,

I don't think down payment is an issue. There are loan products available with as little as 3.5% down, and most sellers are not concerned with the amount of down payment that is required for the buyer to obtain his or her loan. Most sellers are looking at their bottom line and mitigating risk, so regardless of your financing type, the highest, cleanest offer usually has the best chance of being accepted.

If you are bidding on bank owned properties, you are going to be at a disadvantage with financing in general. Most buyers of bank owned properties under $150,000 are cash investors. If you are up against a cash buyer, you better have the higher offer by a significant amount or your offer won't go anywhere.

Don't ask the seller for any concessions (closing costs, home warranty, HOA resale fees, etc.), have an aggressive COE (close of escrow) date if your lender agrees, put significant money down as earnest money (at least $5,000). You can make your earnest money non-refundable after inspections, but only do that if you are 100% sure you are going to get the loan and don't anticipate any issues. I don't recommend non-refundable earnest money if other aspects of your offer are clean and strong.

I've seen buyers lose deals over a $400 home warranty request, so if you really want to get into a house, make as generous and attractive an offer as you can afford. Perhaps that means you start looking at less expensive properties, knowing that you will have to offer over list price. Ultimately you will need to turn to your Realtor for guidance, hopefully he or she has the experience needed to get you a home in this market.
0 votes Thank Flag Link Mon Dec 31, 2012
I believe it has been well echoed here that there are several factors to a strong offer or an offer that will take precedent over others. With that said, unless you are looking at using a FHA/VA lending program; 10% or 15% down will still be difficult even it you have your "ducks in a row".
Best of luck.
0 votes Thank Flag Link Sun Dec 30, 2012
Lucinda (Cindy) Tkach, Agent, Phoenix, AZ It is an agressive amount to put down on an offer. I have been making full cash offers on homes and having difficulty closing properties, There are some agressive additional verbage in a contract that can help in closing the property such as time to close, non refundable earnest money after inspection period. There are more however that can be some ways to include in presenting your offer.

Feel free to contact me direct if you would like any assistance.

Lucinda Tkach
0 votes Thank Flag Link Sun Dec 30, 2012

Like so many others have stated, it's all about the total package and presentation of your offer. It can come down to when the offer came in if it was after the other deals were presented. It's important for your agent to gather as much information as they can to help you position your offer in as good of a position as possible when there are multiple offers on the table. Good luck.
0 votes Thank Flag Link Sun Dec 30, 2012

Down payment can have an impact but likely its other items that are causing you to get outbid.

We have been successful with buyers using 100% financing so its all about the total package being put together.
0 votes Thank Flag Link Sun Dec 30, 2012
Are you concerned that you might be outbid by a cash offer? Over the last several months, I have had financed offers accepted on many transactions. Are you looking for a Realtor to help you with you purchase? I would be happy to work with you and you can review many recommendations on my profile so that you can see the quality of my work. Looking forward to hearing from you soon!
0 votes Thank Flag Link Sun Dec 30, 2012
Hello Boolean,
As others have stated, it's not necessarily the amount of down payment you can give but other terms of your offer. Are you flexible with your closing date? Are you requesting a lot of repairs be performed by the seller? Do you have any other property that you must sell first in order to purchase? These are just a few other items that sellers consider before making a decision on an offer.
I suggest that you work with an experienced real estate agent if you already are not doing so to help guide and counsel you throughout the purchase process.

Good luck to you!

Laura Feghali
Prudential Connecticut Realty
0 votes Thank Flag Link Sun Dec 30, 2012
Size of down payment does not necessarily determine whether an offer is accepted or not. However, a cash sale will often be accepted over a financed sale since the cash offer has a lower chance of cancellation.

If you must finance, make your best offer with regard to purchase price and closing terms. That is all you can do.
0 votes Thank Flag Link Sun Dec 30, 2012
The key when you make a finance offer is to show you have the ability to buy with that down payment. I would suggest a pre-approval Automated Underwriting Approval showing the down payment of your offer.
0 votes Thank Flag Link Sun Dec 30, 2012
Down payments are related to your interest rate and what type of loan you have. they have nothing to do with an offer price.

Please call me directly and I'll be happy to explain the purchasing process and answer any questions you may have about buying a property in the Phoenix market.

Debbie Nieman
Keller Williams Sonoran Living



Happy New Year!

0 votes Thank Flag Link Sun Dec 30, 2012
The offer being accepted has nothing at all to do with a down payment. The offer being accepted has everything to do with the offered amount you make. The down payment is what the lender will allow for you to get a loan, the seller could hardly care less as long as the lender says you can have a loan.

Offer $200,000 - 10% down
Offer $200,000 - 1% down
offer $200,000 - 50% down

All the above are the same to the seller. They get $200,000 and as long as your lender says any will work for them to give you a loan the seller could not care less.
0 votes Thank Flag Link Sun Dec 30, 2012
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