BUYING WITH PRIVACY

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RURAL REAL ESTATE

When you toss your hat into the marketplace . . . you may be tossing away some very personal information as well.

by Jean Vernon

Q. We are looking for land, and when talking to real estate agents the first thing they ask is about our personal financial picture. We feel this is nobody's business and find this practice very offensive. How can we avoid this happening in the future?

A. You probably can't unless you have the ability to pay all cash for your land. A real estate agent is not being nosy but doing a good job when delving into your financial affairs. This is called "qualifying the buyer," and if you're serious about making a real estate purchase you must go through the process. When qualifying you, the agent needs to know your available cash on hand or at least how much you will make available for a down payment. Your current earnings, future income expectations, and stability all will point to whether you can sustain a payment schedule over the years. Also, the status of your credit is important as a seller may run a credit check on you when you make an offer to buy. Only after obtaining this information can the agent match you up with the right properties, ones that you can afford. It is inappropriate and a waste of time to show you properties that are less than you want or are far over your heads in price.

Although many people are uncomfortable sharing their financial information with strangers, remember: The real estate agent is a professional and won't divulge your private business to others. With this exception: When you make an offer to buy property the agent will tell the seller enough about you to make the seller comfortable with your offer. This breach of privacy is necessary. After all, the seller is taking a risk by selling to you on a contract.

If you plan on buying with all cash you simply need to let the agent know how much you are prepared to spend.

 Q. We want to sell our small farm. My husband wants to price the place higher than its actual value to leave room for negotiation, but I think we should price the place at exactly the price we want. Which course of action do you recommend?

A. Anytime you set the price higher than 5 percent above the property's fair market value you are asking for trouble. Studies have shown that a well-priced property will sell quickly but an overpriced property will stay on the market for an inordinately long period of time without ever even receiving a low offer. After a correct price adjustment is made the property usually takes some time to sell because by then it is "shop worn" and most potential buyers have crossed it off their list. Once this happens a buyer will almost never reconsider a property.