Hi Sam: In the price range you are buying in, there are many first time buyers and cash investors who are purchasing homes in today’s market place.

Here is some food for thought:
- Agents are listing their properties under market in order to create an auction/bidding war like format. So you may want to ask your agent to better filter the listings he/she sends you in order to avoid an emotional roller coaster.
- Sellers will always look at cash offers first, conventional loan offers second, and FHA loan offers third.
- If your offer on a home is asking for closing cost assistance, this makes your bottom line offer to the seller much lower which is a negative for you.
- As mentioned by others your FICO score could be a negative if it is a low number.

Ask your agent to package you properly where he/she can show to all sellers your strength as a buyer from showing assets, proof of all three credit scores, pre-approval letter (not a pre-qualified letter), and try to avoid if you can in asking for help on closing cost from the seller.

Sam
You have some good advice here. What I would emphasize:

1. When you make an offer you and your Realtor should know the true market value of the property. This is important for a number of reasons:
a. If the property is deliberately under-priced, then a good agent will warn you about the likely bidding war and what that means
b. If the property is overpriced, then your Realtor should be able to explain how much it is overpriced.

2. Depending upon the situation, you should expect your Realtor to offer market information to determine what you think the true market value is of a property. This is important because regardless of the list price, the actual selling price is determine by the buyers.

3. However, the ultimate judge of value is going to be the appraiser. If you are financing your purchase, know that on May first the appraisal process changed and we are seeing many appraisals coming in lower than we think market value. This means that either the transaction is cancelled, or the buyer comes up with cash, or the seller drops the price, or you compromise.

You may see some properties on the market as "back up offers". Those might be good candidates for you. Short sales and REOs take a long time to process, and in the declining markets for most areas, the price agreed may not be the appraised value by the time you obtain final approval.

In other words, if you do make an offer, and you have the appraisal contingency in force, and the appraisal comes in low, that puts you in the driver's seat. If they need to sell, and the appraisal says $308K, but they were bid up to $315K, they might walk away, and you can come back and get the property for your price.

It is very hard in the price range you find yourself in because there are many cash buyers out there buying anything they can. It is very flustrating for you and myself as an agent to lose out when we have put together a good offer. It will happen just keep the faith!

Sam, I know it can be disheartening when you think you've made an excellent offer on a property and then find out your offer didn't get accepted!

I have to agree with one of the agents below that says the list price doesn't matter - the market value of the house is what matters. Also when you are asking for closing costs (most people do) you may be up against a cash offer that isn't asking for closing costs. They take every concession you ask for into consideration.

Hopefully, the next property you find will be the one you end up with and you'll probably be glad at that point that the others didn't work out!

Happy househunting!

Hi Sam: I believe you just need to understand that you are going to finish back in the pack on more than one occasio5n before you get an offer accepted. Each home you bid on is going to be different and whether or not your offer is accepted not only depends on your offer but the quality of other offers submitted on the same property. Type of financing, amount down, fico score of the borrower, etc . . . all factor in to the listing agent and seller's decision on which offer to accept. The fact you are going FHA could cause you to lose out to a conventional financing buyer. Someone with 10% or 20% down could beat you out too. The important thing is not to give up. Also it is very important that you work with an agent that you feel has your best interest at heart and is experienced and can advise you properly regarding comparable sales, quality of the area you are trying to buy, and details that might tighten up your offer and make it more attractive to the seller and listing agent. Make sure your agent is contacting the listing agent directly and trying to build some relationship with them to try and build a case on why they should take your offer. Also, have you tried writing a letter to submit with your offer? That has worked for me before in a big way. Good luck, let me know if I can help you in any way. Dave Kerlin davekerlin@prucarealty.com

You should talk with your agent, but here are some basics people look for.

Price: the higher the better of course for a seller, but your agent should help you identify what the market value should be. Don't go by the listed price as it may be priced too low or high, which may have been the case with this one. Most homes sell within 5% of the listed price.

Down Payment: Again the higher the better for a seller. They see that as your ability to make up any difference on an appraised value and also makes it easier to get a loan,

Deposit: A deposit of 3% is the most a seller can keep if you back out of a deal for no reason. So having a 3% deposit is security for the seller.

Also any other costs that you do not ask of the seller will help them make a decision in your favor. These could include closing costs, pest control costs, etc.