Is your buyer qualified?

Unless the buyer who makes an offer on your home has the resources to qualify for a mortgage, you may not have a sale.

If possible, try to determine a buyer’s financial status before signing the contract.

Ask:

If the buyer has been prequalified or preapproved (better) for a mortgage. Such buyers will be in a much better position to obtain a mortgage promptly.

Does the buyer have enough money to make a down payment and cover closing costs? Ideally, a buyer should have a minimum of 5% of the home’s price as a down payment and between 2 and 5% of the price to cover closing costs.

Is the buyer’s income sufficient to afford your home? Ideally, buyers should spend no more than 32% of their total income to cover PITI (principal, interest, taxes, and insurance).

Does your buyer have good credit? Ask if he or she has reviewed and corrected a credit report.

Does the buyer have too much debt? If a buyer owes a lot on car payments, credit cards, etc., he or she may not qualify for a mortgage.