I am getting ready to write sow-ball offers on targeted properties and want to include a pre-approval letter from a lender. I am wondering if I should have the approved amount be the same as the initial offer knowing I would likely end-up going up from that price? If I have the approval letter at a higher rate, would that make it more difficult to shoot for a lower price? Any advice?? Thanks - Matt
I wouldn’t show them that you are prequalified for more money when you are trying to get them to take less. Then they know you have more money available and they are going to dig in and try to get you to go up with your offer.
You should be able to get your banker to write you a letter that says they are working with you without giving a dollar amount.
The seller just wants to know where the money is coming from, and that you aren’t just blowing hot air, unable to deliver.
Get one from a hard money lender. It’s free. It’s worth it if the low-ball offers are accepted so that you can wholesale them.
You should visit your REIclub at some point to establish a relationship with a lender so they can be part of your deal network. Even if you only intend to wholesale, sometimes your buyers will need a solid lender.
On your original question, the bank doesn’t have to include an amount. I’m not sure many sellers want to see that you’re pre-approved to buy a house anyway, so am not sure why you’re including it unless you’re getting a retail deal. They just want to know you’ll have cash and can close quickly yourself or through your network of private investors.
get the letter with the purchase price, the address and with same date of the offer. it’ll show you’re comitted to the deal and that you have a working, daily realtionship with your lender, thus giving your offer more credibility.
to get some of these deals closed, you’ll need a very close relationship with your lender anyway so you may as well get comfy with him of her up front…