Advice in a Buyer’s Market: How to Negotiate the Best Deal
As inventory rises and median home prices fall, one thing is for certain: we’re living in a buyer’s market.
Sellers must come down from expensive asking prices as mortgage loan seekers have the power to negotiate for bargains and the best deals possible. Here are a few nuggets of advice for how to acccomplish this affordable goal:
• the amount your down payment and the dates by which you will come up with those funds,
• the dates by which you will first obtain and then approve of (or reject) an appraisal of the home’s value,
• the type of mortgage you will be willing to obtain, the maximum interest rate and fees you will be willing to pay, along with the dates by which you will first apply and then be approved unconditionally for your mortgage.
Walk away if inspection isn’t right
One of the benefits of shopping for a home in a buyer’s market is having time to think about your purchase. Make sure you’re buying a home that meets your needs. And remember that inspections are an important part of that process.
Perhaps you wish to negotiate permission to hire a home inspector to evaluate the condition of the home or to hire other experts to look for structural problems or wood-destroying pests (e.g., termites), mold, radon, lead-based paint or other potential hazards.
You also might want the right to not purchase the home if you aren’t satisfied with the findings of those inspections. You can also ask the seller to purchase a home warranty that would cover certain problems with the home that could surface after you purchase it.
Close on your schedule
A buyer’s market also might enable you to make your purchase dependent upon the sale of your current home and/or on specified terms that are acceptable to you. This type of contingency is often difficult to negotiate in a seller’s market because sellers are less willing to wait for the buyer’s home to be sold when buyers are plentiful.
You also might want to negotiate a walk-through shortly before the deal closes, the closing date and the time when you will take possession of the home. The closing date can be crucial if your purchase of the home depends on the sale of your current home. Payment of closing costs might be a point of negotiation as well.
In the end, keep in mind that you are in control. Don’t feel rushed and don’t agree on any terms that you don’t understand. Take full advantage of this market before the power shifts back to the buyer.