Listing Agents & FHA
I’ve stopped asking agents if they’ll accept FHA loans. I had done that previously so my clients don’t waste time driving to a property they have no chance of buying. (FHA loans are sometimes less desirable because there are a few more steps to closing the deal.) While normally I give agents credit for knowing the difference, last week I actually startled a young agent with the question.
“Yeah, why not. We’ll take whatever the highest offer is.”
This is my kind of agent, I thought. I told my client that we had a good chance to get this place. She went to see it.
Two days later, we came in at the highest offer. The listing agent told me so (are we sensing something amiss?), and that the seller would accept our offer that afternoon.
Several hours of no phone calls later, I get a text saying they’ve countered a lower offer that has a higher down payment.
What could have happened between the morning and late afternoon? Did this agent Google “FHA loans” and get scared? I texted back that this property would surely assess (it had in city records already and had the rent roll to boot), but the agent didn’t want to go back to the seller and look silly.
The truth is, agents should favor FHA loans when they are higher offers, especially if the property will most likely assess. Some agents want cash only if it’s a short sale or the building’s decrepit and they don’t want assessors near the place. But this listing agent’s first instinct was actually the right one.
Now I refer to my client as “my FHA buyer” once to see if there’s a reaction, and if not, we don’t mention it again until the purchase agreement.