STRONG BUYER VERSUS WEAK BUYER
By Robin Shapiro
If you are trying to sell your home, you want the buyer to be as strong as possible. Not all deals “go through” and a strong buyer increases the probability of success. Ideally, the buyer will not have a home to sell, will not need a mortgage, and/or will have a firm mortgage commitment in hand. You would like the buyer to make a down payment (an escrow deposit with the attorney) of as much as possible at contract signing time: 10% is a good number, but I have found that a 5% deposit often works and is common. The total deposit at the closing will probably be higher in order to satisfy the mortgage lender – usually about 20% including the initial contract signing money. I have seen buyers who are not strong; they have homes which they must sell in order to be able to purchase the new home. What if they can’t sell their existing home? Then the new purchase will not go through.
Problems facing the weak buyer can be overcome. Your broker should help you deal with the strong buyer/weak buyer issue. My buyers get the benefit of limited cost free consultations with a knowledgeable mortgage broker, accountant, and lawyers. Often, this has a major effect on the ability to close a deal. Call me. Love, Robin.
