CHAPTER 22 Insist on Prequalified Buyers
One of the best things you can do to protect yourself is to let me help you prequalify your prospective buyer. This ensures their financing (and therefore the sale) goes through. Why is this important? Well, when you accept an offer, you sign a contract and your home goes off the market. If your buyer hasn’t been prequalified, this is when they’ll try to get their loan. Imagine finding out 60 days after signing the contract that the buyer couldn’t get a loan after all! Even worse, imagine if there’d been another interested buyer, but by the time you found out about the first buyer’s no-go loan, the second interested buyer had already purchased another home. That means two months have gone by, and you’ve got nothing to show for it except stress and frustration. That’s why I offer a free prequalifying service. I can help potential buyers choose the best loan for them, but they’re under no obligation to get their loan through me.
Loans available for buyers include:
• Fixed-rate mortgage: This is the traditional mortgage, and has a steady interest rate. These loans last for a certain amount of years: 10, 15, 20, or 30. They’re best for people who plan on staying in their home for the long-term. • Adjustable-rate mortgage (ARM): These mortgages start with lower interest rates than fixed-rate mortgages, then adjust over time. Adjustments happen at predetermined times, and there are caps to keep them from jumping way up. Because of this, ARMs are best for people looking at a more short-term stay or who will refinance before the interest rates get too high. 81
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