The most important thing to remember when buy a home is not a foreclosure or short sale is that you are dealing with an individual and there are no standards or quick formulas to tell you how much the owner will take on their house. The owners have emotional, nostalgic and sentimental ties to the house. You can insult them with an offer that it is too low and on the other hand it is possible to get an accepted offer that is way lower then asking price. It all depends on the seller, their motivation for selling and their agents ability to communicate to them why they should take your offer.

Unlike with foreclosures, the houses are usually in good or great condition and special deals can be made, land contracts are possible, lease options or rent to own. Also bottom line price is not always the sellers hot button, sometimes a longer closing date or a shorter closing could push your offer in front of other buyers.

As with any home purchase I suggest knowing what the current fair market value is and this can be determined by a CMA or Comparative Market Analysis. Basically your buyer's agent will take a calculation of recently sold house in the area that are similar to the house to determine what the house should sell for. If the CMA returns a price that is much lower then the asking price, the CMA should accompany the offer as proof of why you are offering so low. This will reassure the seller that you are not just low balling because you heard that it's a buyer's market but that you truly feel based on facts that you only want pay X for the home.

With privately owned homes the sellers fill out a form called Seller's Disclosures, unless the owner has never lived in the home like with bank owned houses. These Seller's Disclosures will list everything that is wrong with the house, if anything, and will list the age of the roof, plumbing, electrical system etc. and what their conditions are currently. This is a legally binding statement and the sellers are to answer every question truthfully and honestly to the best of their ability.

Privately owned homes have great advantages over foreclosures, foreclosed homes, REOs, bank owned, bank repossessed and distressed homes. One, they are almost always in better condition because they are not sitting vacant where the basement can flood without someone knowing it, mold usually isn't growing like wild fire, the copper plumbing isn't stolen, the walls aren't cracked from the cold winter, the owner knows the ins and outs of the house and can pass that information onto the buyer with the Seller's Disclosures and they owners can be more negotiable.