Looking for some advice_ selling SFH in California

Los Angeles County, California
Real Estate Deal Analysis & Advice
1yFollow

Looking for some advice_ selling SFH in California

Daeun Lee
Investor · Los Angeles · Member since 2020 · 11 posts · 5 votes

Hi everyone, I’m looking for some advice regarding the sale of my property.

I currently own a single-family home in Winnetka, California, located in a quiet cul-de-sac. A comparable home next door sold for $1.1M a few months ago, and I’m seeing similar listings in the area now going for $1M-1.2M.

Due to a recent international move, I had a tight timeline and hired an agent to handle everything on my behalf. The house was listed this past Friday, but the market seems quite slow at the moment. I priced it roughly $200K below other similar homes, as mine needs some love, whereas the others are fully renovated. (But it is not a fixer, major things like window, furnace, electrical pannel etc were updated couple years ago.)

Here's my concern: I'm on an FHA loan with a 3% interest rate (around 4% with PMI), and the loan is assumable. Ideally, I'd like to find a buyer interested in assuming the loan—it would give them a great interest rate and possibly allow me to negotiate a higher sale price. However, my agent advised against it and said it's not possible. I'm not sure why she dismissed the idea, but since I'm under contract, I feel stuck following her guidance.

Did I rush the process? Are there any other options I can explore to make the most of this sale? I’d really appreciate any insights or similar experiences you’re willing to share.

Thanks in advance!

0Reply
22 views

Most Popular Reply

Jesse Rivera
Lender · Long Beach, CA · Member since 2013 · 496 posts · 296 votes
1y

Hi Daeun,

Most FHA loans are assumable, but you'll have to check the note to be sure. Even if it is assumable, it can be a long process because you have to go through the servicer and it's not something they do very often, so usually don't have staff assigned to doing it. If you want a quick sale, I would stick with normal financing.

3Reply
See this reply in the discussion

4 Replies

Jump to latestLatest
  • Payton HaightBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2021 · 124 posts · 86 votes
    1y

    Hi Daeun, If you are under contract, there are not a lot of options unless the buyer breaches the contract or decides to back out. To get the highest sales price, ideally you would want to list the property on the MLS at a competitive price and give it sufficient time & exposure. It sounds like you were on a tight timeline (for an international move) however so that may not have been possible.

    To answer your question, yes there likely was some opportunity cost associated with selling the property quickly. If it is what you had to do for your situation then I would not dwell on that. Since you are under contract for an agreed price, your opportunities are limited. Without knowing the exact details of your contract I can see: negotiating on repairs if the buyer comes back with any requests and trying to get the sale closed as quickly as possible (not entirely in your control but you can save on your mortgage and taxes).

    It would be good to understand why your agent felt that marketing your assumable FHA loan was not a good path. Perhaps because you are trying to sell quickly and/or have a significant amount of equity? Not sure, but that seems like an appealing selling point with today's rates. IF the property falls out of contract and you are not in a hurry to sell, then I would make sure your agent is marketing the property well and give it adequate time on the market so buyers can see it & make offers. Good luck!

    [email protected]380-324-0445
    0Reply
  • Jesse Rivera
    Lender · Long Beach, CA · Member since 2013 · 496 posts · 296 votes
    1y

    Hi Daeun,

    Most FHA loans are assumable, but you'll have to check the note to be sure. Even if it is assumable, it can be a long process because you have to go through the servicer and it's not something they do very often, so usually don't have staff assigned to doing it. If you want a quick sale, I would stick with normal financing.

    3Reply
  • Rick Albert
    Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    1y

    Many agents don't know what they don't know but they don't want to admit it.

    Most FHA and VA loans are assumable, but honestly it just takes one call to find out. I do know that it takes roughly 60 days.

    In terms of the premium, it really depends on what the loan balance is. For example if you property is listed for $1M but the loan amount is $600K, then asking a buyer to come up with $400K may not be realistic. Parts of Winnetka are first time home buyer territory so they don't have the cash to come up with the difference.

    If you don't like your agent, you can cancel the contract anytime on a practical basis. Even if the agent pushes back, you can deny access and reject every offer that comes your way. I would just check the clauses. I've had this happen to me where the Seller decided to cancel, even though I met all expectations and got her multiple offers. It happens. Your agent should not have dismissed your thoughts on the assumable loan, that's poor customer service. She should have looked into it and then you both could have made a decision. Plus to be honest it doesn't cost anything for the agent to mention it in the description. I listed a house recently with an assumable loan and we got inquiries and showings because of it. The buyer ended up getting an FHA loan but the extra attention didn't hurt. This was back in February when we closed.

    1Reply
  • Daeun Lee
    OP
    Investor · Los Angeles · Member since 2020 · 11 posts · 5 votes
    1y

    Thank you all for the reply! I will talk to my agent once again about adding the option to the description. 

    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free