Here is a technique that I share in one of the books I have written about the home purchase process. I refer to this technique as "Forgotten Money".

When you are contemplating an offer on a house, first come up with the offer price and then implement this technique. It's very simple but extremely effective, and it works most of the time, when presented properly by your Realtor.

Here's how it works. In most cases, depending on the time of the year, the seller will already have paid their taxes for several months in advance. Your Realtor tells the seller (or their Realtor), that you are presenting an offer of x amount of dollars, minus any seller concessions which will net the seller x amount of dollars. Then let them know that you are also asking them to waive tax pro-rations (almost as an add-on that has nothing to do with your dollar offer).

The other Realtor or seller will respond one of two ways. They will immediately put the tax pro-rations in the mental category of "forgotten and already spent money". Most of the time the seller has a dollar figure in mind that they want to achieve from the sale. Since that money is already spent they aren't as apt to fight and negotiate over "forgotten money". If that happens, you have just achieved a major victory with little effort.

Let me put that into dollars and cents for you. If the taxes on a house are $3,500 dollars a year and the seller has already paid $2,000 dollars in advance, you have just put an extra $2,000 into your pocket! Even if the figure is only a few hundred dollars, would it be worth asking the question? You bet it would. Remember, you are after the best overall deal you can get, from the financing, to the price, to reducing your potential costs and liability.

The other way they may respond, is to be upset that someone had the audacity to ask for such a thing (it's rare but it does happen). In that case they will probably say something like the following. "I'll give the buyer what they are asking for in concessions and price, but there's no way that I'll give away money that I've already spent!"

If you're paying attention here, you already know what has just happened. The first thing is you successfully shifted the focus away from accepting or rejecting the dollar amount of your offer. And now they are focused on a minor issue in the big scheme of things.

If that's where they take a stand in their negotiating, then you have probably just gotten them to accept at least a couple of thousand dollars less than they may have otherwise, on a more clear-cut offer. Even if they don't give up a dime of tax pro-rations you have still saved big time!

Good luck on your negotiations!

If this article has been helpful please take the time to rate it, thanks!