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Architecture Guide
Cost vs. Value Report
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Top 100 Companies
Take a Quiz
30 under 30
Young Professionals
REALTOR® Emeritus |  |  | | ||
|  Fifteen Benefits of Working with a Buyer’s Representative Advanced tip Understanding Agency Broker tip Contract Terms for Buyer’s Representatives Qualifying the Buyer Advanced tip How Well Do You Listen? Advanced tip Who Are Today’s Buyers? Advanced tip Advanced: Psychographics —Understanding Buyer Motivation Prospecting for Buyers Working with Internet-Empowered Buyers Servicing the Buyer Advanced tips Closing the Deal Advanced tip Due Diligence and Disclosure Advanced tip Staying Safe While Showing Homes Broker tip When to Call It Quits Quiz: Buyer’s Representation Bright Ideas: Working With Buyers Code of Ethics: Working with Buyers More Resources: Working with Buyers Vendor Resources: Working with Buyers | QUALIFYING YOUR BUYERS What Can Your Buyers Afford? You need to zero in on prospects who not only want to buy, but who can afford to buy. Here are rules of thumb for determining what buyers should be able to afford: Conventional fixed-rate mortgage
FHA loans
Although questions about finances are sensitive, your tact and professionalism as a buyer's representative can overcome resistance. Use Internet sites such as www.e-loan.com, and www.mortgage.com to calculate how large a mortgage a client can handle and what percentage of income is reasonable to spend on housing. TIP: Be careful when prequalifying not to tell buyers that they can’t afford a home. Such a statement might be considered steering, a violation of fair housing laws. When in doubt, let the lender prequalify buyers for you. This can be done by phone. The lender will tell buyers the highest sales price and mortgage they can afford, the best type of loan for their needs, and conditions for loan approval. TIP: Get buyers preapproved, not just prequalified. Preapproval is a lender’s commitment to lend; prequalifying is a verbal exchange in which the lender tells borrowers in advance how much money they can borrow. 3 Good Reasons to Get Buyers Preapproved 1. Preapproval helps you know which houses to show. 2. Preapproval facilitates the closing transaction (and payment of commission). 3. Lenders can detect any potential problems that might make obtaining a loan difficult. Credit report errors, high debt balances, and an insufficient downpayment may be corrected with time. If credit problems are significant enough to keep buyers from obtaining conventional financing, it’s better to learn about it before you invest time showing them homes they can’t qualify for. For the Advanced Salesperson Look beyond the standard rules of thumb on what buyers can afford when analyzing a client's buying power. For instance:
| Keep it Ethical Don't deny equal professional services to any client because of race, color, religion, sex, handicap, familial status, or national origin. Article 10 and Standard of Practice 10-1 |