Get pre-approved, not just pre-qualified

Pre-approval is another way to flex your buyer muscles because it lets you demonstrate to a prospective seller that your lender is prepared to give you a loan. Many sellers will choose a lower offer from a pre-approved buyer over a higher one from one who hasn’t been pre-approved. Pre-approval is free and can prevent that worst-of-all situation where a buyer successfully negotiates purchase of his or her dream home and then cannot complete purchase when financing falls through. Get pre-approved today.

Look for areas other than price.

Even though independent sellers can avoid some or all commission costs, there are still other fees that might apply: property and termite inspections, escrow or attorney's fees, a title search, insurance costs and applicable taxes. Even if sellers don’t offer much flexibility on asking price, they may be more willing to make a deal with buyers who offer to share costs of necessary repairs or transaction expenses.

Be prepared to compromise.

Approaching negotiations with a confrontational “win-at-all-costs” attitude is unlikely to yield positive results. Many professionals who teach negotiation skills to executives say a more realistic goal is to find a mutually beneficial solution in which both parties can “win.” This means being aware that you may have to sacrifice something to reach agreement at some point. In this case, be sure to identify in advance what you will and will not give up to ensure you’re happy with deal in long term.

Back up your offer

When offering to buy a property, you don’t have to explain how you arrived at a particular dollar amount. But you may fare better in negotiations if you have some objective basis, such as examining comparable sales. If you're a Subscriber, try Homekeys' ValueKey valuation tool for an objective estimate of value. If you’ve got a substantial down payment that you’re ready to put into escrow, now’s time to mention it.

All participants in a negotiation should be prepared to walk away from unacceptable terms. You may be reluctant to give up after all time you’ve invested in buying or selling process, but emotionally tense negotiations can sometimes benefit from a cooling-off period. Walking away (or watching other party walk away) may be uncomfortable, but it is always preferable to accepting terms you can’t live with.

Finally, remember that there’s often value in being direct. Don’t be afraid to ask questions to learn more about other person’s concerns and objectives. “What do you need from me right now?” “What’s making you uncomfortable?” “It seems we are stuck on this particular issue. Can we set it aside for a moment and see if there is somewhere else we can gain agreement?” Questions like these can help signal your good faith and may help to restart negotiations that become bogged down in details.