Short Sales In Today's Market !

The market has picked up and more buyers are out looking for homes, my job is to help guide those buyers and homeowners who are selling their homes ! I want to touch base and give everyone a quick refresher on what a short sale is and what the process actually is, there are still quite a few leftover on the market and new ones coming onto the market.

What Kind Of Short Sales Are There On The Market ? 

• Approved Short Sales:  This is where the bank has already set a price that they are willing to take for the home.  These kinds tend to move a bit quicker since the "negotiations" have already taken place, unless you plan on submitting an offer below asking price.  These can usually close within 90 - 120 days after going to contract.  

• Un-Approved Short Sales: This is the less predictable short sale because not only has the bank not agreed to a price but more than likely the homeowners are still in the process of submitting all of their paperwork as well.  Normally in order to submit your offer to the bank you will need to provide them with contracts, which means you will need to use your down payment to get into contract.  

What Is The Process Of Purchasing A Short Sale ? 

1. Meeting with your buyers broker, deciding on your offering price based on the actual market value of the home.  Take the time to review how long it has been on the market, and for your own knowledge what the Lis Pendens is on the home.  
2. Presenting the offer to the homeowners, ideally they will accept the offer or counter.  You can sometimes ask the homeowners to do fixes or repairs as well, but your agent will advise you to if this will help or hurt your chances.  
3. Once you have an accepted offer from the homeowner, you will than go into contract on the home.  Your offer will now be submitted to the bank for their approval this is where the timeline becomes less predictable.  
4. The bank will send out their own appraiser to perform a BPO of the property.  This is where they  will go look at the condition of the home, and of the surrounding comparable homes.  This is why basing your offer on the current market value is key, if they see your offer is considerably less than it chances are they will not accept.  Remember the bank does not necessarily have to counter your offer they can simply reject and you will need to re-start the process to change your offer.  
5. Hopefully you will have gotten your offer accepted or successfully negotiated with counters to get the home for the price your comfortable with.  Your mortgage broker should have began your process of you obtaining your commitment so that all the attorneys can schedule the closing and get all of the necessary paperwork from the homeowners for their short sale to be complete for you to be able to close ! 

Truths & Myths Of Short Sales 

• Myth: The homeowners have defaulted on the house and have not paid there mortgage.
• Myth: Anyone can short sale their home if they owe more than it is worth.    
• Truth: The homeowners must have suffered some circumstance for no longer being able to afford their home, and are unable to make other arrangements with the bank.  

• Myth: You can offer the bank whatever you want, they would rather sell it than hold onto it! 
• Truth: The home may not be worth what the remaining mortgage is on the home, but on average the bank wants 96% of the market value of the home regardless of what they are owed. 

• Myth: You can use any company to list your homes as a short sale! 
• Truth: You can, but your home will not sell.  You need to hire an agent and company that has worked on and with banks on short sales in your area.  Only a knowledgeable agent will be able to properly handle a short sale, the reason their is a higher commission rate is because of the extensive additional work we must do.  

• Myth: Whatever is left in the home the bank will come and clean out before your closing.
• Truth: What you see is what you get, literally this unfortunately includes whatever leftover debris is left by the previous owners.  In the case where the homeowners are still in possession they will almost always take their belongings and properly dispose of what they are not taking with them. 

What You Should Look At Before Extending Your Listing !

If your home has been on the market throughout the spring and summer the listing is likely to expire soon, but it may not be in your best interest to pull it off the market just yet.  Now I am not saying to stick with the broker that your using in order to keep it on the market if your not happy with your broker or you want to interview others than by all means do so.  

Anytime I take a listing that will be on the market during the fall/winter season I always let my clients know that business does not stop during these months but you will see less activity.  This is actually better for homeowners, you may not have the quantity of buyers but you will have a better quality of buyers.  If someone is out in snow and cold weather you can bet that they are serious buyers, they aren't just out in the cold for no reason.

Now if you listed during the "busy" season, take into consideration how hard did your broker work for you while he/she had your listing?

• Did you recieve feedback after your home was shown ? It is not always easy to get feedback from other Realtors or Buyers but it is our job to get it for you, a week is more than enough time for your Realtor to inform you of what they thought of the home.   

• How often did you review your market position ? The spring and summer months provide alot of inventory for buyers to choose from so keeping on top of your market is very important.  How often did you and your Realtor discuss your homes position compared to others that were on the market, and those that had come off ? 

• How many open houses did they do, and what was the status of those buyers ? Each Realtor has a different opinion on open houses, I personally think they are important because it gives your buyers an immediate way to see your home.  You should have discussed this with your Realtor before you listed, if you didn't I suggest you do so before extending your contract with them.  You can not be angry if there are none or not enough if you did not discuss what your expectations are.  

• Did you recieve any offers ? Not all offers are good offers, just because your home received an offer does not necessarily mean it was worth you taking.  Did your broker try to work that offer ? Just because someone offers is very low does not mean that this is all they are willing to give.  Sometimes you have to work an offer for quite sometime to make it worhtwhile, but you will never know unless you have someone who is willing to put in the time. 

Before you extend your contract with your Realtor you should take the time to review in detail all of these things regardless.  Pulling your home off the market isn't necessarily a good idea, even 2 or 3 months off the market doesn't change the fact you were trying to sell it. Thanks to technology it takes about a half a minute to find out how long someone has been trying to sell for and buyers do quite a bit of research on their own.  

There are a few things you will need to do if you plan on extending that you may not have thought of, it is not just about signing the report of change form, you will want to update your listing.

• Perhaps re-word the description sometimes less is more, if you have a lengthy description it may be too much or visa versa.  
• Update your pictures, the change of seasons will be upon us sooner than we would like to think so be ready to take updated pictures of your home so your listing doesn't look dated. 
• Update your show instructions with your Realtor, if you think you will need your agent to attend more showings discuss it so when those quality buyers want to see your home they can !

If your new to selling a home than you should refer to my blog which explains the common terms and paperwork that you will need to understand Click Here For Blog.

I will be writing another blog this week reviewing exactly what the difference is between a full service real estate agent, and what other brokerages will offer, I will link it to this blog once it is completed.

Tips For Selling During The Summer

It is that time of the year again, with every change in season I write a blog for homeowners who are selling or thinking of listing.  Although the weather we have been having seems more like spring with all of the rain lately, summer is only a few days away.

Now some Realtors will tell you that summer isn't the best time to sell, this is another one of those myths that I don't know how it started but it is false.  If your selling during the summer months you can expect a few more "tire kickers" but you can also expect to see some very aggressive buyers.

Bring The Outdoors In 

• The simplest way to help your flow from the inside of your home to your outdoor entertaining is very simple.  If you have a patio door or sliders make sure that you remove the blinds if they are not inside the glass, and place a shear curtain up instead.  This allows the light to still shine through, while still giving you privacy.  

• Your patio is almost as important as your dining room to buyers during the summer time, if you have a patio set take the time to arrange it on the patio, spruce it up with new cushions or an umbrella.  Show buyers that they will have the space and area to entertain in your yard.  If your patio is smaller they do sell small bistro sets that you can purchase, these are great for condo's and townhouses ! 

• Outdoor lighting is becoming a very popular trend, it really does make the yard look very inviting and adds some ambiance.   You can pick up sets of 4 from your local home improvement store for under $40, and they are solar so they require no wiring and generally last 3 years before they need new batteries. 

Water Works

• Water your lawn regularly !!  I can't tell you how many homes during the summer months including mine, get those large patches of brown straw like grass.  A brown lawn is never appealing, this is a big part of curb appeal be sure you invest in good sprinklers if you do not have the luxury of in ground sprinklers.  

• Time your sprinklers for times when buyers will not be walking around your yard. I know that the best time to water the lawn for most people is the middle of the day, but take the time to perhaps either run them in the early morning hours or later in the evening.  I am a big fan of strappy sandals and I can't help but not want to walk on a wet lawn, many women will understand this and you want the buyers to spend time in your home taking it in, not avoiding parts of it.  

• If you have a pool be sure to open it up, make sure your water is clear most buyers will assume if your pool is closed that something is not working properly.  You want to showcase this kind of amenity, if you have decking or fencing around it be sure you make sure that it is in the best shape possible a simple power washing, or fresh coat of stain can go a long way.  

Comfortable & Cool 

• Don't skimp out on the air conditioning this time of year, if you have air conditioners turn them on ! Now you don't want to freeze your buyers out but keeping it at a school 68 degrees allows buyers to be comfortable walking around your home.  I can't tell you how quickly a showing will end if a home is hot and stuffy on a summer day, no matter how great the home is no one wants to be in a sauna. 

• Now I do tell most of my homeowners to leave during showings of their home, many buyers no matter how nice the homeowner, still feel as if they are intruding.  What you can do is in a small bowl put some ice and a few bottles of water, it is a nice gesture that will often allow buyers to relax, cool off and really take in your home rather than rush through it.   

Clean Up & Organize 

• This is the simplest thing to do, and surprisingly very important to buyers. Outdoor areas are very important to buyers but where they are going to store all the things they don't want to leave out in the weather is also important.  If you have a shed or a garage with an entrance/exit into the backyard take the time to clean them out and organize. 

• Make sure any chemicals you have (Ex: Pool chemicals, pesticides, gas containers)  are locked up, many buyers will have their children with them since there is no more school, and camps usually let out early.  

These are just a few of the tips for the summer selling season, and there are additional tips that were covered in the Spring Season blog. If you are looking for suggestions on what you could do to spruce up your yard I am always more happy to help.  You can email me pictures of your "problem areas" and I will make some simple/inexpensive suggestions that may help.  

What You Must Know When Selling Your Home !

Many homeowners listed their homes back when our spring market started, which was early this year around February when we started seeing alot of buyer activity.  With the summer market quickly approaching those same homeowners are starting to wonder why their home may not have sold yet.  Now some of you may be thinking that is has only been 4 months since buyer activity picked up, but with a home correctly priced we will normally see them go under contract within 60 days.  There are only 3 things you & your Realtor have control over, and if your home is not selling than you should look at those 3 things first and foremost !!

Price

• When a person is searching for a home with the same characteristics as yours (bedrooms, baths), where does your home fall in the list? Look at the homes as if you are a buyer, if you are finding all the homes are priced below yours offer more you may want to consider adjusting your price. 
• Ask your Realtor to pull recent comps, meet with them and discuss market conditions.  This is also important because your Realtor will need to have these to support the price of your home once you have accepted an offer.  

Myth: Not all homes are created equal, sometimes your home may not be selling as quickly as you would like not because of price but because it is for a particular kind of buyer.  An example of this is if the home your selling is a cottage, or a high-end home because there is a smaller buyer pool for that kind of home.  The most important part of selling a home with a small buyer pool is making sure that you have the best exposure, and easy availability to make sure your don't lost out on any buyers.  

Tip: If your home is priced above market value, it will be impossible for your Realtor to get potential buyers to come and view your home.  Many homeowners will agree to taking a much lower offer than the listing price, but there is no way to convey that to buyers who are viewing your house online, they will rule it out simply because of the price.

Availability

• If your home has very strict restrictions on when potential buyers can come and see it, you may want to reconsider how/when you are showing it.  If you are unavailable to show your home during the week because of your work schedule, you should speak with your Realtor about allowing them to accompany showings during the week to take the burden off of you, and allowing more buyers to be able to get in.  
• This next one is something that not all Realtors agree with, but I am a big believer in open houses.  I schedule all of my open houses for the month in advance because I want to give buyers an open invitation to come in and see your home the moment that they see it online.  
• Taking it a step farther you will want to make sure your Realtor is getting back to those that are inquiring about your home in a timely manner. Sometimes it is not always about how quickly buyers can see your home, bu how long it takes for your Realtor to get back to them! 

Myth: Some sellers believe that by requiring 48 hours for their home to be shown gives them a better chance of preparing their home to make sure it shows well.  Unfortunately, not all buyers give their Realtors 48 hours notice that they want to see your home, it is better to ask for a reasonable amount of time to prepare than possibly lose that buyer. 


Tip: When potential buyers are viewing your home whether it is a private viewing, or an open house do not follow them around.  Often times buyers will feel as if they are intruding on the homeowners by being there, you want to give them space to take it all in! 

Condition

• First thing you should do is look at  your pictures, if you took pictures before the spring flowers and grass became green you should ask your Realtor to update your pictures.  Remember you need to sell the house first via the pictures to get the buyers to want to come and see it in person.  
• Spruce up your curb appeal, give the front door a fresh coat of paint or add some solar lights and plants.  Buyers spend their weekends driving around looking for open houses, even if your home is not having one you still want to catch their attention!  
• If you have broken screens/doors/cabinets/tiles take the time the time and replace them if it is not a huge expense those are the things that make buyers look at your home and think of "projects" although they have quick fixes.  

Myth: Many homeowners think fixing up your home is a waste of time and money when you are attempting to sell it. Now this is only somewhat of a myth, doing major renovations may not be the best idea, but doing small projects to fix or update your home is normally recommended to help your homes chance.  

Tip: Take the time to look at your home objectively, remember although you can not make every buyer happy you can help the chances of your home selling quickly by doing some small projects.  The best place to start is by doing all those things that were on your "honey do list" that you hadn't had time to get to! 

There are so many different factors that come into play when getting your home sold, but these are the top 3 that are the most important ! Over the next few weeks I will be blogging more about some tips for sellers, but as always if you have a question I did not cover please feel free to comment or email me directly! 

Listing Your Home, What You Should Know !

This week I am going to write about something I don't talk about very often which is sellers who are new to the process of selling their home.  Now some of you might be thinking this doesn't apply to you but it just might so I have compiled a quick list of sellers that is a sign you should take the time to read this blog:

• You purchased your first home from a For Sale By Owner 
• You have not sold a home in the last 5 + years 
• You inherited a property or are an Executor of an estate 

One of the most important steps to selling your home is the paperwork, not only signing it but reading it and understanding it! I can't tell you how many homeowners who have not sold a home recently are very surprised by the amount of paperwork that now goes along with listing your home. 

NYS Agency Disclosure 

New York State requires that anyone who is buying/selling a home fills out the agency disclosure paper, it clearly defines who it is that the Realtor is working for.  Obviously you will sign that the agent will be working for you, but NYS has changed with the times and they now address Dual Agency before it exists.  

Dual Agency is when your agent works for both you as the seller, but also works for the buyer.  This can sometimes cause a conflict of interest, if the deal requires negotiating it can blur the lines of who your Realtor must disclose what to.  It is my recommendation that when it comes time for you to sign this piece of paper that you require if Dual Agency exists that it is Dual Agency with a designated sales person.  What this means is if a buyer walks into your home and wants to negotiate a deal that your Realtor will have an agent from their office work for this buyer rather than representing both sides of the deal.  

Multiple Listing Service Contract

This is a very important contract for you to read most Realtors will tell you it is standard and direct you straight to the bottom to sign.  They are correct when they tell you it is a standard form, but you should be reading it because this is the detailed description that will be on not only on MLS but all of the additional websites that your home will be listed on.   

You want to check certain things in particular: 

1. Taxes are correct (Ex: If your taxes are not correct you may end up with a buyer who is unable to purchase because they were mis-informed, remember pre-approvals do include the yearly taxes)
2. Make sure the number and descriptions of rooms are correct (Ex: If your kitchen is an eat in kitchen, you must make sure it is accurately inputted. These are things buyers will be placing in their search criteria and you wouldn't want a oversight to cause potential buyers to not see your home.  
3. Be sure your floor plan is accurately described (Ex: If you have an entry hall, or a laundry room you want buyers to know that because these might be important to them)
4. Utilities are described completely (Ex: Some people will have a preference when it comes to these things, again you never want to misrepresent your home, even a simple mistake can turn off a buyer) 
5. This last one may upset some Realtors, but the 2nd page of your MLS Listing agreement is where it shows what the commission will be, and where it will be going.  Remember there are 2 sides to every deal if your agent has told you that they will be taking a 6% listing because they split it equally with the buyers broker make sure that it is written that way in your contract.  

Exclusive Listing 

This is something that you may or may not see, if you are listing your home on Multiple Listing Service you should not be signing this paper unless there is a beginning and an end date filled out.  I will sometimes hold a listing as an exclusive until I have the pictures uploaded, & the virtual tour online but when I do I always write that the end date is at the homeowners request.  You might wonder why I do this, and it is just the way I run my business I want to make sure that my listing is up to not only my standard but to my sellers as well.  Once the homeowner sees the listing and approves it we than release the listing onto MLS for it's big debut !! 

Property Condition Disclosure 

The property condition disclosure is pretty much self-explanatory, it is a semi-large packet that details the history of the property.   Most Realtors, and your Real Estate Attorney will recommend that you do not fill this out. Instead you at closing you provide the buyer with the  $500 opt out credit.  The reason we recommend you do this is to simply protect yourself from future liability, even the most knowledgeable homeowner can be unaware of hidden issues in their home.  

Lead Based Paint 

If your home was built prior to 1978 than you are required to fill this out, and your Realtor is required to give the buyers a informative booklet about Lead Based Paint.  This is a common form that you, the buyers, and all Realtors involved will need to sign and is required.  If you are not sure what year your home was built it is always better to fill one out to be on the safe side.  

Seller Services Guarantee 

Unfortunately not all companies offer this, but if you are going to list your home I would recommend not signing with a company that does not provide you with one.  This is your guarantee that the Realtor will provide you with all the services he/she agreed to do in order to get your home sold.  It also gives you the ability to walk away from the contract with them if they are not providing all the services, I can't tell you how many unhappy expired clients I come across because the Realtor did not do what they had assured the client they would do, always remember that you have your guarantee and if your Realtor isn't doing the job perhaps they need to be reminded of that guarantee.  

Now, I have to take a moment to remind you that in order for you to be able to hold your Realtor accountable for the work that they are supposed to be doing, you must also do your part.  Mis-communication about the marketing plan for your home, can often cause a strained business relationship between Realtor and homeowner so you want to go over the details prior to signing anything.   

Coldwell Banker Residential Brokerage does have some additional paperwork that your average Brokerage does not have.  The reason is very simple, we are not your average company we offer additional services to our sellers that not only get their home sold but to make it a easy and enjoyable experience.

Affiliated Business Agreement

If you are one of my frequent readers than you have heard me talk about all of the additional services we are affiliated with.  For today I will not be going into the description of them, but I will link the appropriate information so you can look at the ones you may not be aware of.  Our affiliated business agreement, is to let you know the different companies and services we offer but we as agents do not profit from our buyers or sellers using them.  The reason each of these are so important to our company as a whole is the difference it makes for our clients.  

Coldwell Banker Mortgage Company

Coldwell Banker Home Warranty

Coldwell Banker Title Services & Insurance

Coldwell Banker Concierge Services

You will also receive a copy of your Comparative Market Analysis, be sure you keep this in your file for future reference.  Also make sure you keep full copies of everything that you signed, as well as additional paperwork you may sign during the time your home is listed.  Coldwell Banker Residential Brokerage, does have a system set up on a secured server that will store copies of all the paperwork you will accumulate during the transaction.  This is a great tool for someone who is on the road for work,  lives out of state, or just prefers keeping documents stored online rather than filed away.  


I hope everyone finds this blog helpful, if you have any additional questions please always feel free to comment and I will respond to your question as quickly as possible ! 

Rentals 101

Rentals are not something I often blog about, but my blog always come from things that I come across, and I am seeing more and more homeowners opt to use a Realtor when it comes to renting out their space.   I also see more home buyers wanting a rental income in their new home, and not many are educated on what to look for and what they should be staying away from.

Renting Your Space Tips

The very first thing I have to say to all the homeowners is be considerate to your Realtor, just because the tenant is paying the commission you should still understand you are signing into a contract with a company to work for you.  If you think a family member/friend is going to rent from you find this out BEFORE you list your home, don't call us a few weeks into all our work to inform us you don't need us because you found someone close to you to rent.  We will never express to you that we are upset because we are professionals, but imagine going into work for weeks knowing you would have to wait for week 4 to get paid, and when week 4 comes your told that they won't be paying you.  Of course there are sometimes where circumstances arise and this happens as well, and I have willingly withdrawn some rentals because the homeowners were upfront and honest with me.

Picking your tenant is always a tough decision, sometimes you will have tons of applicants and other times you will only have a few.  I always suggest choosing your tenant based on Credit Score, Background Check, Proof Of Income, and Current Landlord Reference.

When looking at someones credit score their are a few things you should keep in mind.  In today's economy many potential tenants may have a low credit score, if they do you can ask them to share the entire report and base your decision on their entire report but keep in mind legally you are ONLY allowed to see the score itself.  Many tenants looking for whole house rentals in recent months are coming out from a short sale on their own home, which is what caused their score to drop.  If that is the only blemish on their credit I would recommend still considering them as your tenant.  Many people fell on tough times, and if they are pro-actively trying to fix things I believe that it does say something about their character.

Another big concern is for those tenants who are working off the books because proof of income becomes a little more difficult.  Even if you are being paid in cash neither the Broker or the Landlord is the IRS, we are not concerned about you not paying taxes.  Many employers are willing to write a letter stating that you are paid an average amount weekly, or if you frequently deposit a specific amount of money simply showing us the account deposits with your personal information blacked out (ex: Account #, SS #)may be enough for the homeowner.  Another time when Proof of Income can come into question is for those who are Independent Contractors, like me because we don't receive checks weekly or sometimes we will have a ton of business and other times they may be less.  If you have tax returns, or some sort of quarterly statement available from either your business account or employer, even tax returns can work for proof of income.

References and checking with their current landlord must be done, and documented.  Your real estate agent will be making the calls for you so before they begin making the calls be sure to review with them any specific questions you want them to ask.  No one will purposefully give someone a bad reference, what you want your agent to look for is how naturally they answer the questions.  There is a reason why we ask on the application how long they have known their reference, if someone has only known the tenant for say 2 years they may be unsure of certain things like the length of someones employment if they worked there for a very long period of time prior to the friendship.  If a reference is unsure of things like if their friend smokes, has any pets, or current employment status that could possibly be a red flag for your agent to make note of.  Any red flags that come out in the course of checking references should be communicated to you and your agent should call the prospective tenant to discuss them.  I once had someone unsure of their friends pet situation because the prospective tenant had not yet told their friend that the older dog they did have would not be making the move with them.  Again communication is always key in just about every aspect of buying, selling, or renting your home!

Tips For Buyers Looking For Rental Income Potential 

Now let's talk about one of the myths about renting and that is it's legal to rent out your basement .......... I am here to burst many bubbles when I say in the Town Of Babylon that it is illegal to have a basement apartment !! What is legal, is to have your basement converted to living space, so you can have everything except a kitchen and it be legal.  There are many reasons they will not allow for a apartment in your basement, and the most important reason in my opinion is it is NOT safe!

For those first time home-buyers the ability to have rental income plays a very important part of what their new home must have.  Most first time buyers are not aware that there are many home styles that can easily obtain a rental permit.

• High Ranch
• Split 
• Expanded Capes
• Duplex 

There are a few reasons why I recommend making sure that you have a legal rental.  Most important is you can never predict what could possibly happen to you or your home.   If you have a issue in your home such as a fire or a flood and your insurance company comes in and discovers your home has a rental and that is not legal there is a very good possibility they will not help fix damages because your home is not what you were representing it to be.  If your home is in close proximity to another dwelling and a  fire occurs in close proximity the fire marshall can request that your home is checked to make sure it sustained no damage.  No good will come of the Fire Marshall coming into your home that contains illegal rentals.  The legal fees, time, and bringing your home up to code can be costly.  

If your buying a home and you are really depending on the rental income to make ends meet month to month, be aware you may have a few months of vacancy or even worse a bad tenant which is a risk you take when you are renting out part of your home.  Many homeowners get pre-approved for a higher purchase price than they may be comfortable with paying out each month, and assume the rental income will be their safety net.   Sometimes I find that buyers think their rental income will be much higher than it really is, when your looking at homes with that income potential make sure you get a professionals opinion on what the rental income will be.  When I say professional opinion I am talking about your Buyers Broker, I am sure none of my readers are shocked or surprised that I am mentioning yet another reason for you to have your own agent !! 

Another question buyers often have is what do you do if the home your purchasing has an illegal rental in it already, can you still buy it?  Of course you can, their are a few things that protect you as a buyer from getting into a bad spot with an illegal rental.  Banks have become very strict about their inspections if they see an illegal rental they will raise an issue, so before placing an offer you will want your agent to make sure the homeowner will be removing it.   It is important to know that most banks will only require the homeowner to remove just the stove out of an illegal kitchen, and if you want more done than that you must get the homeowners agree to it and have it in your contract! Many homeowners will say they will be removing the kitchen for the home inspection, and buyers unfortunately do not clarify what exactly they will be doing and issues can arise.  You also will have your title search where they will check to make sure their are no current C/O or permit outstanding on the house.  If the homeowner is in the process of correcting these things they will have to do so before closing, and as long as they are working with a reputable attorney will not hinder the sale being closed.  

Tenants Looking To Rent A Home With A Broker

The most common question I get from tenants is why is the brokers fee so high ? The common broker fee is an additional months rent, on top of your 1 Months Rent & Security to the landlord.   When we actually do the math the broker is not really making all that much so here  is the breakdown based on a $1200 Fee: $600 To Landlords Agent $600 To Tenants Agent now you have figure the average amount that the agent actually ends up recieving from the proceeds is about half which is about $300.  The higher the rent, the higher the brokers fee but the bigger the home the harder it is for us to find a qualified tenant.  

The best advice I can give prospective tenants is to be prompt, and timely when it comes to making it to your appointments and bringing in the required paperwork.  Before I even begin the search I ask for your credit report, if you do not have a recent copy I am able to obtain that thru our Credit Report Company.  By looking at the report prior to actually submitting any rental application we are able to see if any red flags will be raised, and how we can handle them.  Once you have one copy of the credit report it can be used for all applications you will be putting in, so you will not need to constantly re-run it.

If you are planning on using a broker or renting from a home listed on MLS, the most important thing is to make sure you are not waiting for the last minute to begin your search.  This is very important here in the Village where the apartments are in such high demand many will only stay on the market for a few days, and than they will be rented.  If you plan on moving I suggest start working with a broker about 90 days before your lease is due to expire.  Based on your wants, and needs the realtor will be able to tell you roughly how long it will take to find your new home.  

My best recommendation to all those tenants is similiar to the advice I give to my buyers and that is to get your own broker! Your going to be paying that one months brokers fee no matter what, so why wouldn't you have someone doing all the legwork that goes into finding your new home ! 

The TRUTH About What Your Home Is Worth!

Now almost every homeowner that has seen one the "Online Home Values" that are now being offered by Trulia, or Zillow call and express to me that their home is not only worth more than what it is/was listed for but it is even higher than that!

Let me just say this in the most simplest terms, they are WRONG! Yes I said it, and I am sure in some parts of the country perhaps their pricing is correct, but not here on the South Shore of Long Island.  Experts have done research and their values are actually off by around 20% and in some cases up to 50%! Now most people will than ask how can they do that, it is simple they put a disclaimer on their page and that's it. 

If you really want to know what your home is worth you need to make sure the information that the value it is being based on is accurate, and up to date! On many of these sites the value of your home is based upon the closed sales, under contract sales but they don't often reflect current sales.  Now here are the biggest problem with these sites.   Problem #1 if your neighbor or someone across town from you decides to over price their home that doesn't raise your value obviously, but according to these sites it does.  Problem #2, just because a house has the same number of bedrooms or baths it does not mean they are worth the same. This is where style of home does come into play, a Colonial style home is going to have much more square footage, than a Cape style home even if it does have the same amount of bedrooms.  Problem #3, we have no idea which of these formulas they are using when they calculated the value of YOUR home! Problem #4, they could never receive information as quickly as a Realtor can, computers are a wonderful tool in today's market but that will never replace hard work, and research by an actual person!

So how do you figure out what the value of your home actually is, well that is simple.  Call a Realtor!

They should be able to provide you with at least 3 comps for homes that sold within the last 180 days - with similar characteristics to your home (ex-square footage, rooms, bedrooms, baths, taxes).   This will be crucial information, prior sales are what the bank will be looking for.  When you are looking at these comps your should be sure to see how many days this home was on the market as well. 

They will also show your homes that went under contract with all the same characteristics that I previously mentioned.  This will show you about what price bracket you should be in when you price your home to get an offer.  This will be a great way to see how long homes in your area are for sale before they get an accepted offer!I personally believeit it is better to be at the top of a buyers price range, than at the lower end. 

Lastly they will show you homes that are on the market, again all the same characteristics and this is where you have the chance to judge your home from a buyers prospective.  From their prospective you want to make sure that your home shows value for that price range.  I do not mean price it below market value, just simply look from a buyers prospective and if your home is all original, and other homes on the market are updated you should make sure you adjust your price accordingly. 

This is the ONLY information that will give you the real value of your home, so take the time and speak with your Realtor regularly about your neighborhoods current market!

Winter Safety Tips

The holidays are in full swing, and I am sure we are all enjoying the holiday season since Long Island has gotten quite lucky and we have had some unusually warm days, considering this time last year we had already had 3 or 4 snow storms by this time!

Buyers are also taking advantage of this warmer winter weather, I have personally had some amazing turn outs to my open houses, and many clients who are still very active in the search for their new home, so I wanted to take a moment and talk about some safety pre-cautions that both home sellers and buyers should be doing during since this season has been quite busy!

1.  Christmas Decorations Are NOT Meant To Be An Obstactle Course To Your Front Door!
Let me start by saying I always tell my homeowners that they should put out their decorations, it will make your house feel like a home, and it does wonders to sell your neighborhood.  I put out a ton of Christmas decorations out, which also means a ton of extension cords, timers, and outlets but  if you have cords running across your walkway, you need to be sure that they are placed where potential buyers will not trip or fall!

2. Let There Be Light
Make sure that buyers can see where they are walking, this is a simple fix many people have lights in the driveway that are triggered when someone walks up and it will usually illuminate the walkway as well.  This is not the only area that you need to be able to see, home buyers need to be able to see your HOUSE NUMBER, I can not tell you how many calls I get from a buyer who happened passed a home with a for sale sign, but have no idea what house number it was! This also is necessary so people who are coming to view your home can easily spot your home, not all streets have only 1 house for sale, and some seller choose not to have signs, so make sure that numbers stands out!

3. Be Prepared For The Snow Trail
This has got to be the biggest pet peeve for home sellers in the winter, and that is buyers will often track snow and salt into their home.  I say this for both buyers and sellers, put a winter mat in the front hall of your home, and agents wipe your feet normally the buyer will be sure to clean off their shoes if they see the agent do so, and sellers and if you choose not to have a mat, be prepared for the trail, and a good chance someone will slip and fall.  I often carry one in my car, this is for when I have open houses to make sure my homeowners come home to a semi-clean floor!

4. Let It Snow
Of course if it begins snowing right before your homes showing or open house, there is not much you can do except shovel and home not too much accumulates between the time you leave, and the buyer arrives.  A simple suggestion is leave a smaller shovel, and container of salt next to your front steps.  This gives the buyers agent the ability to throw a tiny bit of salt down to make your walkway or steps easier for the buyer, and in the case of an open house allows them to keep the walk clear.  Not all agent will do this, but personally I do, I want the buyers to feel comfortable coming in even if it is flurrying out. 

5. Don't Open Your Door To Just Anyone
It is oddly alarming that I have had numerous homeowners if they should just let "people" not agents just come thru their home if they knock on the door! The answer is NO, NO, and NO! This is not just a rule for the winter time, but all year round.  This is also why I always have a open house advertised thru-out the time a home is listed with me, obviously you do not want to be rude, simply say that it is not a good time, and be sure to tell them when your next open house is scheduled, or give them your listings agents direct number to schedule the appointment! You do not want to turn off these potential buyers, but our company believes in safety anyone that enters your home we want to have some sort of information before they go walking thru. 

Now some homeowners have chosen to sell their home after they have moved into their new home, and if your home has not gone under contract by the fall, I always suggest taking some steps to winterize your home to protect it for the winter time.  So here are a few tips for those whose home are vacant!

1) Furnace Inspection

• Call an HVAC professional to inspect your furnace and clean ducts.
• Consider switching out your thermostat for a programmable thermostat.
• If your home is heated by a hot-water radiator, bleed the valves by opening them slightly and when water appears, close them.
• Remove all flammable material from the area surrounding your furnace.

2) Get the Fireplace Ready

• Cap or screen the top of the chimney to keep out rodents and birds.
• If the chimney hasn't been cleaned for a while, call a chimney sweep to remove soot and creosote.
• Buy firewood or chop wood. Store it in a dry place away from the exterior of your home.
• Inspect the fireplace damper for proper opening and closing.
• Check the mortar between bricks and tuckpoint, if necessary.

3) Check the Exterior, Doors and Windows

• Inspect exterior for crevice cracks and exposed entry points around pipes; seal them.
• Use weatherstripping around doors to prevent cold air from entering the home and caulk windows.
• Replace cracked glass in windows and, if you end up replacing the entire window, prime and paint exposed wood.
• If your home has a basement, consider protecting its window wells by covering them with plastic shields.
• Switch out summer screens with glass replacements from storage. If you have storm windows, install them.

4) Inspect Roof, Gutters & Downspouts

• Check flashing to ensure water cannot enter the home.
• Replace worn roof shingles or tiles.
• Clean out the gutters and use a hose to spray water down the downspouts to clear away debris.
• Consider installing leaf guards on the gutters or extensions on the downspouts to direct water away from the home.

5) Service Weather-Specific Equipment

• Service or tune-up snow blowers.
• Replace worn rakes and snow shovels.
• Clean, dry and store summer gardening equipment.
• Sharpen ice choppers and buy bags of ice-melt / sand.

6) Check Foundations

• Rake away all debris and edible vegetation from the foundation.
• Seal up entry points to keep small animals from crawling under the house.
• Inspect sill plates for dry rot or pest infestation.
• Secure crawlspace entrances.

7) Prevent Plumbing Freezes

• Locate your water main in the event you need to shut it off in an emergency.
• Drain all garden hoses.
• Insulate exposed plumbing pipes.
• Drain air conditioner pipes and, if your AC has a water shut-off valve, turn it off.
• Leave the heat on, set to at least 55 degrees.

 

Things To Know When Your Buying A Short Sale

Buyers pursue short sales to get a good deal. So when you see a price listed for a home that you think is too low for the neighborhood, before you jump on that price like hot fudge on a sundae, ask your agent to call the listing agent to find out if the home is a short sale.

What is a Short Sale?

A short sale means the seller's lender is accepting a discounted payoff to release an existing mortgage. Just because a property is listed with short sale terms does not mean the lender will accept your offer, even if the seller accepts it.

Be aware that the seller need not be in default -- to have stopped making mortgage payments -- before a lender will consider a short sale. A lender may consider a short sale if the seller is current but the value has fallen. The seller may have over-encumbered, owe more than the home is worth, so a discounted price might bring the price in line with market value, not below it.



Check the Public Records

This is where if you are working with a buyers agent, their expertise will be vitale. 

Do your research before making an offer to purchase. Your agent can find out who is in title, whether a foreclosure notice has been filed and how much is owed to the lender(s). This is important because it will help you to determine how much to offer.

If there are two loans, you could have a problem. The first mortgage lender's position is protected by the second lender, unless the second lender does not want to foreclose. If a seller owes $160,000 on the first and $40,000 on the second, offering $160,000 leaves nothing for the second. The first will need to give something to the second to gain its cooperation.

Submit Documentation and Purchase Offer to Lender
Once the seller has accepted your offer, send it to the lender for approval. You do not have a deal until the lender accepts. Also, send the lender a copy of your earnest money deposit. Do not be astonished if the lender asks you to increase it.

In addition, the lender will want to see that you have your own loan available and you are preapproved. Send a preapproval letter to the lender. It will help if your agent sends a list of comparable sales that support the price you are offering to pay for the home.

Give the Short Sale Lender Time to Respond
Make your offer contingent upon the lender's acceptance. Give the lender a time frame in which to respond, after which, you will be free to cancel.

Some lenders submit short sales to committee, but most can make a decision within two to three months. Get a name and phone number for the appropriate contact at the lender. Don't send an offer blindly to a department.

Reserve the Right to Conduct Inspections
Generally, the lender will not pay for customary items that a seller would pay. These include home protection plans for the buyer, buyer credits of any kind and pest / termite inspections. A buyer will be asked to purchase the property "as is," which means no repairs.
It is extremely important that a buyer obtain a home inspection.

Consider Me Your Friend

So after a nice family party, I was sitting and thinking about my chosen profession.  It seems I always pick a career where there are some misconceptions about how the business works.  My family is always the very first people to ask ..... Is it true ? And it got me thinking I wonder how many other people have the same questions, but don't have a close family or friend with the experience to ask ! So take a moment consider me your close friend or family member to find out all the answers to those questions you may have been curious about ! 


Don't you get to make your own schedule. and take vacation whenever you want ! 

We don't get to go on vacations or spend our days lying around making a few calls here and there and walk away with an enormous paycheck.

We miss family functions, birthdays, parties so that we can take our buyers to see the home that they have fallen in love with and must must must see it this weekend !

This is our job, and we will never complain about it, we chose this life just like the doctor who must leave his home in the middle of the night for an emergency at the hospital, that is how important buyers can be.  We would never want our buyer to miss out on a home that could be their perfect home !

Why do brokers try and get me to sign a buyer brokers contract ? 


The simplest answer ..... protection ! Not only for ourselves but for our buyers as well, it lays out what our responsibilities are and lets other realtors know you have someone looking out for your best interest and protect you !

Here is some examples of what COULD happen.

Realtor A takes out buyers, shows 50 + homes.  They were all in the price range, area, and met his needs and what he wanted.
Buyers goes to an open house, after a recent meeting with Realtor but puts in an offer and purchases with the Realtor B who was holding the open house.

Buyer finds a beautiful home, falls in love and it is in a tax bracket that just fits into their budget.  They make an offer, and it is accepted ! When they apply for the mortgage they find the taxes are not what they thought, and are unable to get the house.  By having a committed Realtor, this will never happen because it is one of the very first things we confirm !

You get paid a ton of money when you sell a house, and it is so easy to sell one !


Keep this in mind some homes can sell in 30 days or they can take almost a year.  There is no way to predict how long a home will take  to sell, we can make an educated and aggressive marketing plan but there can always be factors that are not within our control.   And no matter what happens at the end of our day we must give your home 110% no matter how short of a period or long period of time your home takes to sell.

We don't always get paid a huge paycheck at the end of the day, so here is a quick and honest breakdown on where it all goes.

Please keep in mind it is different for each company !! 

6% Commission

3% To Listing Agent                              3% To Selling Agent    
When you list your home be sure to ask how the commission is split, it will help push Buyers Brokers to push your home to clients.

Percentage To Listing Comp.                 Percentage To Selling Comp.
We aren't just using their space we have secretaries who make sure your paperwork is in order, receptionist who assist us in scheduling the showings for your home, they make those cute postcards that got sent to 200 of your neighbors !
Now you figure the websites we are advertising your home on, and the system we have so that we can tell you how many people saw it and how long they spent on your page, and to make sure they can reach us day or night to schedule an appointment to see it.
Possible desk fees, yes we don't get to use their ink, electric, internet, fax machines, copiers for free again each company is different.

Taxes
Good old New York State, we don't have to pay them right away but we do still have to pay them !

Additional Marketing
Any good real estate agent will do more than basic marketing.  Professional pictures, additional print advertising, staging, signs, and time which again could be little or a lot to sell the home but the effort must be 110% no matter what.

Why do some agencies offer a discounted commission and not others ? 


Well if you hire a discounted realtor they may try to sell your home, but more than likely there will be some things they are unable to do because they do not have the resources to do it.

The broker who takes a 4% listing may try just as hard as one who takes it for 6%, but the additional marketing , time, and staging will do nothing but help the sale of your home !

The money that you are paying in all truth is not to just pay the Realtors, it is your marketing tool to sell your home !