Agents...I could use some help!

Asked by Cindy Davis, San Diego, CA Thu Feb 21, 2013

I have been working with an FHA buyer (single mother) for about 6 weeks around $325K. We've bid aggressively often being at the top price, been the first one in, written letters, gone with the listing agent's lender, and done most things right. Still, we keep getting rejected because of the FHA. My client is becoming demotivated and I am getting angry at the discrimination out there. Any thoughts?

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9
Yanoska Diaz, Agent, Miami, FL
Thu Feb 21, 2013
Why don't you ask the client to get approved through Homepath? 3% down-payment, no mortgage insurance. This solution was brought to my attention by a mortgage broker friend, it worked!
1 vote
David Rudd /…, Agent, San Diego, CA
Thu Feb 21, 2013
We have several FHA clients (a few in escrow) but several which continue to get beaten out, and while not stated by the seller's agent, clearly the fact that it is an FHA loan factors in (we are offering above asking in many cases and not even getting a counter).

I can't fault the selling agent for explaining the different offers, their benefits and risks. FHA has come along way and gets a bad wrap by many seller's agents. I typically give the agents a call and do my best to educate them as to how FHA deals work out just as fine as non FHA. Needless to say - some listing agent's put FHA offers at the bottom of the pile.

I also try to prepare FHA clients that it may take 5 - 10 offers before an offer is accepted.

Best luck
1 vote
Davis Martin…, , Houston, TX
Fri Jul 7, 2017
In my opinion, everyone interested in the deal must do their part. For example: I have personally talked to seller agents for my Realtor's clients assuring them that this is a deal that can be done swiftly. Get a lender to talk to your sellers and assure them that the deal will happen. As a lender you are also glue that holds deals together and you should use that knowledge and position to help your Realtors get their offers accepted.

Many sellers are going by industry myths and other reasons. The ones I have seen is that the house does not pass inspection (in which case why would you want your client in it anyways?) or because they have heard it takes forever to get funded... this is also NOT true.

I believe that many sellers just don't want to make repairs on their homes so they don't want to go FHA. If their AC is about to go out, the inspector can catch it and FHA will make the seller repair it before they can sell the home. So anyone running from an FHA loan I would run from their house.

All real estate agents are supposed to be watching out for their client's fiduciary interest so please talk to a lender that can clarify this for you. Here in Texas (and everywhere else I assume) you have the ethical responsibility to lead your clients to what is best for them. Find a good lender and get your offers approved.

http://www.lenderhouston.com
0 votes
Dana Cadena, Agent, Morganville, NJ
Thu Feb 21, 2013
Hi Cindy, One idea is to ask the mortgage banker to provide an FHA Conditional Commitment, so you can document the strength behind your buyer's approval. An FHA Conditional Commitment just shows that all the buyer needs is a contract of sale & an appraisal in order to finalize their commitment. This means the income, asset & credit docs have already been underwritten, and essentially this conditional commitment makes your FHA buyer, now a 'cash' buyer. Sometimes, I remind agents that if I have a strong conditional commitment, everyone is truly cash at closing, as long as the loan is approved & cleared. By removing the doubt over the FHA-stigma, this conditional commitment may save the day! Take care, any Qs - call me (732) 306-3062. -Dana
0 votes
Barbara Gran…, Agent, Anaheim, CA
Thu Feb 21, 2013
Hi Cindy,

Since FHA guidelines are a bit more stringent when it comes to the condition of a property, your buyer may want to consider making any FHA required repairs. That may make her offer a little more "seller friendly".

By the way, Annette is right, there is no discrimination here. It is definitely a tough market for a conventional buyer, let alone an FHA buyer. Hang in there.

Best of luck,

Barbara Grandolfo
0 votes
Walter 'Skip'…, Agent, Brea, CA
Thu Feb 21, 2013
Hi Cindy,
For what it is worth, your buyers are not alone. The FHA buyer is at quite a disadvantage is this market especially in that price range. A strong pre-qual letter, fico scores and an introduction letter about the buyers might help. As others have mentioned, removing the appraisal contingency would help but difficult to recommend.
Good luck,
0 votes
Annette Law…, Agent, Palm Harbor, FL
Thu Feb 21, 2013
If the purchase contract you present states clearly your buyer is able and willing to pay the offered price REGARDLESS of the FHA appraisal, the offer becomes competitive.
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This means your buyer can not be shopping at the top of their purchase capacity.
It is not discrimination...it is business.
It is your task to make their offers competitive otherwise you will just be hanging more paper.
0 votes
John Arendsen, Agent, Leucadia, CA
Thu Feb 21, 2013
Try reaching out to Melissa Zavala. She's in Escondido and has an answer for just about any question you can ask. Especially in this area. Let me know how it turns out. Good luck.

mrzavala@gmail.com
Short Sale Expeditor
0 votes
Sinead McAll…, Agent, Oceanside, CA
Thu Feb 21, 2013
Hi Cindy,
I feel your pain. This price range is brutal right now! When you say, "often being at the top price," I assume you mean of the range (if there is one)? It sounds like you are doing everything right, but most likely will need to go above list to get your offer accepted. That's just my opinion, but I wish you the best!

Good Luck!
Sinead
0 votes
Yikes. I like David's response above too. Perhaps a phone call, personal letter, tug on some heartstrings :)
Flag Thu Feb 21, 2013
THANKS...We're going way over list price!!! :)
Flag Thu Feb 21, 2013
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