Here are some of the things good agents are doing differently now:New pre-approval letters. I wrote about the importance of a solid pre-approval letter in my last “Buzz.” If my buyers don’t have an approval from a San Francisco lending professional with an established reputation, I ask them to get one. I’ve already seen this new practice make a difference—an offer I presented last week was well-received because the pre-approval letter came from a mortgage broker the listing agent knew and trusted.

Loan Contingencies. Up to this month, the best offers had no loan contingencies. Now I wouldn’t think of writing up a contract without one. If I were representing a seller and received an offer with no loan contingency, I’d question the buyer’s reliability and sanity, unless was paying all cash.

Longer Escrows. When the lending industry was flush with capital it was easy to get loans quickly funded. Now, only a handful of lenders are offering reasonable terms—and they are severely backed up. Not long ago I was writing contracts with two-week escrows. Now my deals have closing dates 35-40 days out from ratification.

Close scrutiny of New Homes Contracts. New Home contracts are custom documents written by the Developer’s attorneys and need a close read. I reviewed one for a client last week and found no loan contingency. This is for a project that has dozens of units under contract—we were the first to notice that a buyer could lose their 3% deposit if they didn’t get the loan. Happily, we were able to build a financing contingency into the contract so my clients’ 3% won’t be in this kind of jeopardy.

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FUTURE FALL-OUTI think there will be major changes in how New Home developers do business. Their contracts will have to be revised to reflect the current lending climate and the financing incentives they’re offering will be changing. Since first-time buyers with limited resources are a common new home buyer profile, there will be slower sales in this segment of the market and ultimately more room in the prices.

I’m hearing a variety of stories about buyers losing deposits in New Home developments because of the loan crisis. I’m sure there are battles over the 3% deposit in the resale market as well, but buyers in new developments are at a greater disadvantage because of how language in a New Home contract is structured.

I’m also seeing some unusual Loan Products. There are still good adjustable rate mortgages available—but sometimes the terms are like nothing I’ve seen before. One lender is offering 15-year and 10-year fixed rates with interest-only payments at 6.875%. Another is offering a more traditional 6.25% fixed for five years. Please be aware that as far as I can tell, these loans are only available to buyers who can go ‘full-doc’ with great credit and have at least 20-25% down.

Bottom line for Buyers: If you are well-qualified, this is a great time to buy. Less competition and nervous sellers are making it easier to find good deals, particularly in inventory-saturated markets like South Beach and SOMA.

Bottom line for Sellers: If you have a property that pushes the ‘hot-buttons’ (right architecture, location and lay-out) you can still anticipate multiple offers. For examples of what’s hot right now, see my next postings which will show examples of properties that recently went into contract above their asking prices. We’re starting with the TIC— If you want to head straight down into mortgage madness, you should skip this part. . .

· Three-bedrooms/two-baths

· Yummy remodel completely down to the studs

· State of the art media/family room

· Direct access to exquisite south-facing English rose garden.

· Listing price in the mid-900s

The rose garden makes my heart go pitter-pat each time I see it. Please call if you want more information and I will get you in pronto.