Do You Qualify to Buy An Expensive Atlanta Home?
It has been a tough week for Atlanta luxury home buyers on the high end…because the low listing inventory levels are actually moving the market here rapidly. When showing exclusive properties in the multi-million dollar range–or for that matter, even one million dollars, the foreclosure banks and/or private owners are demanding to see pre-qualification letters from borrowers and letters from your bank on cash deals. As an Atlanta luxury homes agent, I can personally attest to this.
Cash buyers constantly balk at this financing request saying they most certainly can afford the property and they act affronted when asked to produce a letter from their bank verifying funds. That is a major mistake! One man said when he bought his Hummer, he wasn’t asked to produce a letter of credit first, he saw all the cars he wanted, then bought the Hummer. Well, there are some major differences between between purchasing a luxury home, and buying a car. A car dealer will let me go in and out of cars all day long, day after day, week after week without asking if I can afford to buy. All I’ll get is a strong sales pitch on what they can do for me as opposed to another dealership.
Don’t get me wrong, it’s uncomfortable for me to ask someone about finances no matter how long I’ve been selling real estate (22 years), but I know especially in the Atlanta market that unless I can fax over a letter to the agent representing a luxury property, there is no way I will ever be allowed to show that property. It was suggested to allow the owner’s agent to accompany the showing and that would assuage the owner’s fears that the seller was indeed qualified. Unless the other agent is a Vulcan and does a mind meld on the buyer and agent, there is no way the listing agent or seller can determine your ability to purchase. I’ve had the phrase “gate crasher” or “lookey loo” thrown at me a hundred times when I’ve begged to be permitted to show a property where my buyer does not want to produce a letter or proof of funds. You will not be asked to produce bank statements, retirement fund paperwork, etc. by anyone other than perhaps your lender. This proof of funds letter is a broad letter, signed on official letterhead by an officer of your financial institution or bank introducing you to the property owner basically. Once I have that, view the property and make an offer, the sellers stand up and listen because they understand the ball–namely the cash–is in my court. I can tell you one thing. Whenever I’ve had a Atlanta luxury home buyer who wanted to see a property, I’ve usually been given the proof of funds letter before I even had to ask. When viewing athlete’s homes for example, I am usually asked to send the proof of funds letter not to the listing company but rather to the athlete’s representative as that is his job, to protect and counsel that star. Conversely, I’ve been contacted by attorneys who represent buyers and they handle all their financial dealings which includes sending a proof of funds letter to the sellers directly.
In any event, if you want to see a luxury home in Atlanta, it’s not MY rule or even the other listing agent’s rule that you have proof of funds, you just won’t be allowed on properties where the owners demand a proof of fund letter before viewing, so you’ll just have to forego ninety-five percent of that market. That may defeat your purpose in choosing the best Atlanta luxury home!
About Jim Crawford