Posted on 07-06-2017 by Joe Marcotte
Talk about the importance of a buyer's agent but just this week, our buyer's agents were able to save our homeowners $30,000. Here's what happened. We had a buyer that wanted to purchase a condo in downtown Los Angeles. The condo was listed for $850... Read more
Talk about the importance of a buyer's agent but just this week, our buyer's agents were able to save our homeowners $30,000. Here's what happened.
We had a buyer that wanted to purchase a condo in downtown Los Angeles. The condo was listed for $850,000. The condo had been on the market for about 45 days so it was about time to either lower the price or for the seller to take a lower offer. As the buyer's agent, we worked closely with the lender and customized a preapproval letter stating that the buyer was approved for $810,000. This is what we decided to offer, $810,000, a $40,000 decrease.
Now, my buyer was actually approved for $900,000 but if the seller knew that, they probably wouldn't accept a lower offer, knowing that the buyer could actually afford more. But, because we had our own buyer instead of using the listing agent, we could offer less without the seller or the listing agent knowing what we were up to. If the listing agent was also the buyer's agent and knew that the buyer could afford a lot more, there's really no point to offer any less. But, because the listing agent and the seller didn't know that my buyers were qualified for more, we started a negotiation. The listing agent called our buyers agent and asked how much they love to the home. Now, our buyers a letter to the home and would definitely have paid the $850,000 but there's no reason to share that with the listing agent at this time. Our buyer's agent said that they were interested but also have their eye on other condos in the area. The listing agent asked if the buyer was approved for any more than the $810,000 and our buyer's agent was very vague and really didn't give a straight up answer although they didn't lie.
The listing agent and seller finally came back with an $840,000 counter offer. We again decided to customize and revamp our preapproval letter stating that we may be approved for more but would have to undergo a financing contingency. We came back at $820,000 and because the listing agent and seller didn't know that the buyer was approved for more, didn't want to lose out on the potential offer and so they accepted the $820,000 offer, $30,000 lower than the list price.
When you have your own buyer's agent working for you, keeping your negotiation strategy close at hand, it means that the seller and the listing agent are working blindly and are more likely to go along with your offer.
If you're looking for a buyer's agent for your next Los Angeles condo or home please call our office today. We are experts at negotiating so that our buyers get the best price and the best terms.