Why did the Seller not accept my FHA offer? EP 261

In this video i go over some of the reasons why a Seller may not accept your offer when using a FHA mortgage. Tune in for some facts and some rumors that are floating around.

Hey guys this is dave your mortgage guy dot com and let’s talk about why the seller may not have accepted your offer because you’re doing an fha loan okay i i get this question a lot for home buyers when they may lose out on an offer and it’s well they’re not taking any fha offers or they don’t want fha offers right and so i want to give you kind of some of the

Back stories some of the information to know going into making an offer okay and some of these are rumors that have been in industry and some of these are factual information so number one is many times the the seller’s agent can perceive that an fha client is not as strong of a buyer than maybe a conventional loan okay why is that well maybe it’s less down payment

You know maybe they’re assuming it’s a credit score thing maybe they’re assuming you have a high debt to income ratio sometimes they’re going to default that you may not have the additional money to pay if the home doesn’t appraise okay so when you’re making an offer and if it’s in a competitive market and you’re losing out on homes going um you know getting an

Fha loan you really want to maybe present your financial strength right which is going to be a pre-approval letter from a reputable lender right you’re going to want to work with a realtor who’s really going to help sell your offer you may even want to show that you have the additional money if there is concern that the home may not appraise okay that’s going to

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Strengthen your offer the other thing is this if um the home does not appraise and that buyer is to back out of the home that fha appraisal will stay with the home for six months meaning any client who goes to buy that home in the next six months has to use that same fha appraisal okay so that right there is it can be perceived as a negative obviously because

If the home doesn’t appraise let’s say they’re selling it for 250 and only sold for 240 they know no matter what offer they get from an fha buyer they’re going to be stuck with that old appraisal that’s a concern for them okay the additional thing is this on fha loans the seller must be on title for over 90 days before you start the fha uh loan process okay it’s

Called the 90 day rule this is really aimed at people who are flipping the property okay so a buyer buys it does some work wants to sell it in two months if it’s an fha loan they’d have to wait an additional month before they accept any fha offers all right this also would be for any company who had bought the home and is now selling it such as open door zillow

Things like that so even though it’s not a flipped home in the um usual sense it still falls under that so you may see we’re not accepting any fha offers on this home until x right and that’s why because of this rule now let’s talk about fha loans versus conventional when you go to get pre-approved for a mortgage i would want to know all of my options good

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Bad or indifferent okay if your credit score is maybe iffy or not excellent and the fha loan gives you better terms so maybe a better interest rate i would still want to look at a conventional loan and see what those terms are here’s why what’s the best loan for you is the loan that’s going to get your offer accepted okay so if that means i have to go and do a

Conventional loan to get my offer accepted i’m gonna go that route i’ve worked with clients where yes the fha loan option gave them better terms it looked better but when they found their dream home and the seller said we’re not taking fha period if you do conventional we’ll accept your offer i’ve had clients want that change immediately so their offer gets accepted

Okay so it’s very important you know your offer is going into it don’t blindly just take a pre-approval letter from a lender and say okay hey this is what i have you also want to work with a great realtor who knows how to negotiate has experience and knows what it takes to do the work to get your offer accepted because if look if a seller gets 12 offers they’re

Not actually looking for the best offer out of that group they’re probably looking at which offers are most concerning or not as good and removing those and if fha could be one of those factors that that agent is looking for to say hey i don’t want to take any fha offers on this property let’s stick to what we perceive to be easier or maybe cleaner type situations

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You’re going to lose out on that offer you want an agent who’s going to go to bat for you and say hey what does my client need to do to get their offer accepted right and then they’re going to find out well we would like a conventional loan we’d like more down payment we would like to know your client can pay the difference if maybe it doesn’t appraise you want

To exhaust all those options okay so those are the reasons why many times a seller will not want to accept your fha offer is because of that right and it’s good to know this information so you know what you’re up against when you go out into the market all right call or email me anything comment down below subscribe to my youtube channel and if you find my videos

Helpful i’d love to be your lender thanks guys you

Transcribed from video
Why did the Seller not accept my FHA offer? EP 261 By Dave Your Mortgage Guy