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Serious Buyers … Don’t Bid Every Last Penny You Have!

Locally and Globally the market is very competitive, houses going for tens of thousands of dollars above the list price. I’ve had buyers who want to bid all the money in their budget in order to win a bidding war. This is not Las Vegas … I counsel them away from it.

Why? Most contracts forgo an Inspection, hence the house may require tens of thousands of dollars worth of repairs immediately, like a new roof, plumbing or electrical repairs. You will have no money left to cover these essential repairs.

Or what if the appraisal comes in low? This means the lender’s appraisal says the home is worth less than what you’ve agreed to pay for it. Now you’ll need a higher down payment to make up the difference.

Unless my clients have others who can give them extra funds, my advice is to hold back 10% to 40% beyond what you can actually afford. In the end, it just may not be the house for you. There will be others, one you can afford.

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Loretta DiTirro