Can We Peek at Their Price?
QUESTION:
We found a house we like, but it turns out there’s another bidder also looking at it. We don’t want to pay too much. Is there anyway we can see the other bid?
ANSWER:
Imagine if the question were turned around. Would it be OK if the other bidder saw your offer?
There are two ways to handle such situations. First, don’t get into a bidding war. The odds are that you will overpay. Second, set up a budget. Given your budget and financial preferences, what is the most you’re prepared to pay for the property? If the price is above your limit, say thank you and look elsewhere.
QUESTION:
My mortgage payment officially is due on the first of the month, but I can pay as late as the 15th without penalty. My lender keeps calling before the 15th to ask about the money. What are they trying to do?
ANSWER:
They’re trying to do two things. First, they want to collect as much money as possible and as quickly as possible to maximize the interest they can earn on overnight deposits. Second, they’re seeking to rewrite the mortgage terms by demanding early payments that are not required.
Mortgages are written in the “lender’s usual form.” That’s a loaded expression that means the lender and the lender’s lawyers get to write all the terms of the mortgage agreement. If the agreement has a “grace” period that allows you to make payments without penalty until the 15th, then that’s the deal.
The next time the lender calls, ask if you owe a late fee or if your credit is being hurt by using the grace period. If the answer is no, then ask them to stop calling.
Be aware that some loans do not have a grace period and that you could face credit dings and fees by paying late. As always, know your lender – and know your loan.