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Some lenders are pulling back from rigorous credit score requirements following the uncertainty caused by the pandemic.

This is good news for buyers.

Credit scores on government loans have been lowered to 640. Some lenders accept as low as 620 for conventional loans. With interest rates currently below 3%, you really should consider buying a house and stop renting.

Can You Win Offers with VA and FHA Loans?

First-time buyers without extra cash have a hard time competing in this hot sellers’ market.

On many suburban listings we see offers for 10% above list price. Most of these properties will not appraise for the contract price. That’s why sellers select the offer with the most cash paid to support an appraisal shortfall.

​Buyers with VA or FHA loans, buyers not offering extra cash, and buyers asking for seller paid closing costs are at a severe disadvantage. It’s almost impossible to win against cash offers or conventional financing.

​​Can You Buy Homes Without Competition?

Not every listing sells in just a few days with multiple offers. Some homes have been listed on the MLS for weeks, even months.

They don’t sell for one of two reasons:

  1. they’re overpriced and/or
  2. they’re not updated.

While it may be hard to convince an “overpriced” seller to accept lower offers initially, there comes a time when they have enough and just want to get rid of their property. After all, they have to pay a mortgage, property taxes, insurance, and utilities. It adds up. And, when the time is right these sellers will accept a low-ball offer.

That’s what happened to one of my clients. His family just purchased an upscale, suburban residence for only $430,000. However, this house was originally listed in August 2019 for $614,900.

​My Recommendation for VA & FHA Buyers

Look for homes that have been listed for more than 30 days and need updating.

There’s a good chance you can buy such a home at a fair price without competition. That being said, you will almost certainly receive a full price appraisal.

Be prepared to do the remodeling yourself or hire a contractor after you close.

With this strategy you will gain instant equity and you won’t overpay for your new home like other buyers who get caught up in a bidding war.

Need Help Finding a Great Home in Today’s Hot Market? Call or Text me at (614) 975-9650

Susanne Novak has been a Realtor since 2007. She is the broker and owner of RE/MAX 24/7 in the Dublin Historic District. Susanne typically helps 50-60 families each year with their real estate needs. She's your trusted advisor when you search for your dream home, and a skilled negotiator when she lists your property to get top dollar when you sell.

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