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. 

How Does A Seller Decide Which Offer To Accept ?

The market has definitely perked up this spring already and we are seeing more multiples offer than before.  With multiple offers on homes it has changed the dynamic of how buyers are and should be submitting offers.  Not every home with multiple offers will result in a bidding war, so I want to take the time and explain give you a quick overview on what factors of your offer will be taken into consideration by the seller.

Financing:

• Cash Deal: This has more than one benefit to the Seller, but normally the offer will be significantly lower than what the list price is because of the simplicity of the deal.  First it can close right after the title has cleared because there is no bank involved.  Second, it is usually in "Sold As Is" which means no work will be done to it.  The buyer is still permitted to do the home inspection but you will be much less likely to have anything repaired or replaced. 

• Conventional Loan: This refers to the terms, there will be a larger down payment with this loan and the appraisal might be a bit easier. Since there will be no PMI included in the mortgage payment it will increase what the buyer can afford by monthly payment.  From a sellers point of view the term itself is better because the buyer is putting down a large amount down of 20%.  

• FHA Loan: This again refers to the terms, with a smaller down payment this is often where we see buyers asking for a "Sellers Concession".  For a buyer with this loan there will be PMI that will need to be accounted for, and the appraisal must be handled carefully so that the loan to value comes in where it is needed to.  

• VA Loan: This is a tough sell for a Seller because the buyer does not have to put any money down.  When I have a buyer who is using a VA Loan I suggest still putting down the same amount as what would be due for an FHA Loan to show the Seller your commitment, and you can receive that money back after closing.  

Additional Financing Terms:

• Sellers Concessions: The easiest way to explain this term is it just like taking a cash advance from the mortgage to have your closing costs included.  There is 2 points of view for a seller with this.  First is if the home is going to appraise for $10,000 - $12,000 more why shouldn't they find a buyer willing to pay that.  Second is that what if the home does not appraise will their buyer still be able to purchase the home, or will the deal go bust! 

• Using Gifted Funds: This is something very common with first time buyers, they will count on "gifted funds" from friends or family.  Buyers must check the guidelines of the bank in which they are using about what amount of money can be gifted, and what information they will want and need from the "gifter".  Many times buyers think it can simply be written as "gifted" and that be it, but each bank works differently you should let your agent speak with your Mortgage Representative to be clear on those terms.  

Conditions: 

• Buyers With Homes To Sell: When a buyer has something they need to sell, it puts the seller at risk.  First the funds from the buyers are more than likely coming from proceeds of their sale.  This means that not only does the seller need  things go smoothly with their home, but they are dependent on an agent who is not working for them to push the other deal through quickly and smoothly.  Secondly, timing with this kind of sale is very important because the buyers will only have about a week window after one home closes to get into the other which puts the sellers in a position where the buyers timeline is much more important than theirs.  

• Buyers With Nothing To Sell: Obviously it is better because the sale is not dependent on any major factors aside from their homes appraisal going smoothly.  It also means that the timeline will have less in the way of deadlines aside from the normal mortgage commitment time which is usually between 30-45 days from contract.  

• Home Inspections: First let me say no matter what the case is, spend the time and money to get a home inspection no matter how many offers are on a property.  It is your way of knowing exactly what your getting yourself into, if you want to move quickly and don't want to spend the money ($500 - $750) at least have a licensed contractor check it out.  Depending on what repairs or replacement you want done, can change the mind of a seller on which offer to take.  If another offer comes in $5000 less they may go with it simply because of what conditions the offer is based on.  

The most important piece of advice I can give anyone who is starting their search is to make sure you have an agent who is working for you.  If the home is aggressively priced they should know it and be able to point you in a direction that will get you an accepted offer the quickest so that you don't lose out.  To see more about how to decide on what to offer, and what the process is look here. 

Setting The Price Of Your Home To Sell

I think it is that time again to write about the topic of what you should be using to determine the price of  your home, and what kind of pricing options you have !! This is extremely important because the more homes that go onto the market, the more competition you will have, you want to make sure your listing stands out and gets sold before we have another sudden rush of new inventory ! 

How Real Estate Agents Determine The Value Of Your Home 

All real estate agents should be bringing a Comparative Market Analysis of your home when they come to meet with you to list your home.  Real Estate Agents use a similar system to what the banks will be using to determine your value these are the main characteristics in importance order that you will want to be using.  

• Homes within 1-2 miles of your home that recently sold within the past 90-120 days.
• Homes of the same style (EX: Ranch, Hi Ranch, Cape, Expanded Cape) or similar square footage if there is a lack of comparable style homes.  You can not compare your home to one of an opposite style just because you think your home is just as good, the bank won't allow it.  
• Rarely will you see homes with the exact same amount of bedrooms, baths, or even property size this is where you need to adjust the comps accordingly.
• Take a look at what homes are currently on the market, and compare how your home stacks up to theirs, these homes are your competition.  

In my opinion, if you meet with an agent and they do not bring with them a Comparative Market Analysis than they are not putting in very much effort to help you sell your home since determining the price of your home is really the very first step before listing it.  I always say my job is not to list your home, but to get your home sold ! 

The 3 Styles Of Pricing Your Home 

• Overpriced Home - This type of pricing is not only a waste of your agents time but yours as well.  You are putting yourself behind and unnecessary roadblock, and guaranteeing you will be having the dreaded price adjustment talk sooner than later.  Many homeowners will say "But I am flexible, just bring me an offer!" - There is only one problem with that, and it is that we can not relay that to all of those buyers who aren't a- looking at homes $20,000 above their budget or b- tell those buyers who are in that range that you are flexible.  Remember most buyers find their home online, so presentation including price is a very important factor and we can not write on your listings that you are willing to hear all offers ! 

• Market Priced Home - This is an educated homeowner who has taken the time, and hopefully the advice of their real estate agent and is priced in the same area of those comparable of the recently sold homes.  This kind of pricing will get you showings, and hopefully an offer within 6 months of being listed.  As other homes sell their might be a need to adjust the price of your home to stay in line with what homes went from contract to sold once you were listed.

• Action Priced Home -  Before I explain, let me say this action price does NOT mean pricing the home as if you were giving it away.  When you use this style of pricing you first base it on the comparable homes in the area that sold, but your focus is shifted to those homes that are currently on the market (those that are priced at market value, not of those that are overpriced).  You look at your direct competition and price it anywhere from $8000 - $10,000 below that of your best competition.   Normally on a market priced home once you have received an offer that $8000 - $10,000 is the wiggle room of where you would accept an offer.  What you do by pricing it that bit lower is your drive much more traffic and increase your chance of multiple offers, almost every home that is "action priced" will sell for either the listed price of the home, or possibly more because you have increased the buyers perception of value !   

There are a few things you will also want to keep in mind when you are thinking about where you want to price your home.  The most important questions you should be thinking of when determining the list price of your home are 

1. How much will you need to be able to walk away from your home after the mortgage payoff, brokerage fees, attorneys fees, title transfer fees. If after you total these things up if what you would need to list it for is significantly higher than what your home is worth it is always better to leave it off the market until your in a position to sell rather than have it listed and sit on the market making buyers wonder once wrong with it.  The exception to this is when you are avoiding foreclosure by doing a short sale.  
2. How quickly do you need or want to move ? If you want to move quickly than your best option is to really have your home priced at the "action priced" point so that you can move things along without any delay and a guaranteed end in sight ! 
3. How many times has your home been listed, if your home did not sell chances are it was overpriced which means at the very least you must get in-line with the current market value of your home.  Re-listing it at the inflated price again is working against yourself and buyers will begin to disregard your home because "there must be something wrong with it", and not even the best agent can overcome that ! 

If you are interested in having a Comparative Market Analysis done on your home, please contact me directly.  I will be writing another blog that goes into the specifics between things that will add value to your home verse things that are more features of your home, which can affect the overall listing price of your home in an upcoming blog ! 

                                                                                      

Home Sweet Home Improvement

If your thinking about putting your home on the market, and you want to get top dollar from your home the saying you need to spend money to make money is often the last thing you want to hear.  There are plenty of inexpensive ways to help improve your homes chance of selling, you don't necessarily need to spend thousands of dollars by doing a complete overhaul but certain key changes can really change the overall appearance of a room ! 

• Kitchen makeover. The kitchen is the most popular room in the house to remodel. Most in the industry will tell you money spent upgrading a kitchen produces the highest return on investment. One of the best things you can do in a kitchen is replace the countertops, sink, and appliances.  Depending on the size of your kitchen you can get remnant pieces of granite, or another great option is butcher block counters they always give a kitchen a great clean look ! 

• Bathroom fixer-upper. Upgrading a bathroom is another sound choice and will often provide a significant return on investment, as large bathrooms typically top the list for those seeking a new home. A quick change of a vanity, toilet, lighting, and fresh paint can cost under $500 and give your bathroom a great facelift ! These are simple things that can really give a buyer a fresh look at your space ! 

• Flooring updates. Many homes on Long Island have hardwood floors if they were built in the 60's or 70's whats amazing is the builders than covered them with carpeting ! If you have hardwood floors pull up that carpeting and show them off ! If you have bright colored carpet trade it out for more neutral colors this can help the buyer visually picture their furniture instead of thinking about what exactly would match your carpet ! 

• Create Outdoor Living Space. This is another great trick, and the best part is normally you will get to take your upgrades with you.  If you have a nice patio you can buy some new furniture, solar lighting, and a few potted plants can show the buyer the potential in even the smallest yard plus that new patio set will come with you to your next home ! Solar lighting and bright colored plants are also a great option for your front yard to help your curb appeal ! 

Whether or not you choose to update your home there are some things you should do and I can not stress this enough but de-clutter your home.  Pack up what your not going to be using (seasonal clothes, holiday decorations ect.) and put them into your attic or storage facility ! I can't tell you how many times homeowners de-clutter the home but put it all into their closets and than we have an avalanche when the buyers open them up ! You want the buyers to have the space in your home to see what it will look like with their furniture and their family living there ! Almost every buyer whom I have had buy a home, always took the time to figure out where there things would fit before making the final decision ! 

What Happens After Your Offer Is Accepted

You have successfully gotten an accepted offer it may have been a quick simple negotiation or it may have been a bit of back and forth, but either way you have officially gotten passed one of the biggest parts of the home buying process ! This blog is specifically what will happen with a straight sale, there is a much different process for short sales & foreclosures, I will be writing another blog specifically about those in an upcoming blog.

The next 2 weeks are going to be a very busy time for you, because although your offer is accepted the homeowners will still show it to other potential buyers and place an offer on your dream home !! Lower offers or offers with less desirable conditions will be held as "back up" offers, but their is always a chance someone will outbid you and their offer may have terms that the owner may prefer. That is the reason why time is of the essence so your going to want to get things done as quickly as you possibly can !!

Before Your Offers Accepted - Call Your Mortgage Broker
Your realtor should have already developed a relationship with your mortgage broker, if they have not spoken to them they shouldn't wait any longer to get that relationship going.

Sometimes the seller will want you to get a 2nd mortgage pre-approval, this is not unusual in my business, because I work for a company who has their own mortgage company. A seller can not however tell you who to get a mortgage with, they can only request a pre-approval thru a specific company.

Step 1 - Sales Agreement & Attorney Review
This is a very standard form and is very important to your purchase, this is really sometimes the first step, but if you have had to negotiate and make changes to your original offer you will want to fill out a new updated one to send over to the attorneys. The buyer and the seller will fill this out independently and receive a copy. You attorney will review this document normally without any changes, because the contract will have the specifics credits or add-ons.

Step 2 - Home Inspection
Many companies will have a preferred list of home inspectors, if you already have someone. You want to have the home inspection as soon as possible, even with a first accepted offer. A home inspector should check for of course the obvious red flags: mold, mildew, termite damage, but you also want them to check to make sure of some other things you may not think of. Most will check to make sure that the hot water, actually gets hot, in older home this will take a bit longer but these are things that once you move in can become important. They will also check things in the attics, basements and crawlspaces.

Homes that are remodeled it usually only takes about an hour for a full inspection, and others usually take about 2 hours. You will get a full copy of the report, and they will talk to you about it before they leave the property.

Step 3 - Sign The Contracts
Now depending on how your home inspection went sometimes you will be just going in to sign contracts with no changes, but sometimes there will have been more changes because of things that came up during your home inspection. Remember your offer is still accepted, but now you are going to be changing the terms.

I can appreciate a seller does not want to have to do work to the home but remember no matter who the buyer is there will be a home inspection and if it is a significant problem it will come up again.  That being said sometimes buyers should be reasonable also don't let fear of losing the house force you to overlook a major problem but don't let a little problem cause you to loose your dream home either.

Now that you have completed those 3 steps you can finally take a deep breathe and celebrate a bit about the purchase of your new home.   There are of course a few more steps that will happen between going to contract and your closing, I will write another blog giving you the timeline and what you can expect to be doing next ! 

Deciding Whether To Buy Or Rent, What You Need To Know !

It's that time of year again where we see renters deciding whether or not they will continue renting, or will consider being a new homeowner ! This blog is to help all those considering purchasing answer that most common question "Should I Buy Or Should I Rent?" 

Why Should I Buy A Home Instead Of Rent ? 

It's a fact that in most markets, buying a home is significantly cheaper than renting.  Renting is money you will never get back, but buying a home is an investment in your future.  In most areas, if you can afford to rent, you can afford to buy! For more information on this topic you can refer to my blog, here it will give you both the pros and cons for both buying and renting, as well as offer you alternative options.  

How Do I Know I'm Ready To Buy A Home? 
The best way to know if you're ready to purchase a home is to look at your current situation.  You don't need to be employed with the same place for 2 years, you just need to have had a steady income in one field for the past 2-3 years.  You will want to run your credit and take a good look and make sure everything that is on the report is correct, if not you will want to have it corrected! You will also want to make sure you have money saved up for a down payment, in some cases you can withdraw from an IRA penalty free for a first time home purchase.  For more information on this topic you can refer to my article, here.

How Much Money Will I Have To Pay Upfront To Buy A Home? 
This is not an easy answer, because there are two factors depending on what kind of loan you take and the amount of the loan is what will decide your down payment.  For an FHA Loan you will need to put down 3.5% where a Conventional Loan you will need to put down atleast 20%.  The average cost of a home in Suffolk County is about $325,000 which would require a FHA down payment of $11,375.  

You will also need to factor in closing costs, but you can also ask for a sellers concession or have the money "gifted" to you from a friend or family member.  This ranges again by the loan amount, and any mortgage broker is required by law to give you a good faith estimate of closing costs, this is why you should always choose a reputable bank Of course, Coldwell Banker Mortgage is more than happy to help and you will always be given all of your loan options.

Once you have decided that you are in a financial position that you would like to go ahead and begin searching for your new home there are a few things you should look into.  You will want to learn the difference between what kind of homes are on the market, who you should have working for you, and what happens once you have found that "perfect home".  Because each of these topics are best explained in detail I will list each topic below with a direct link to blogs to help you get informed ! 

• Why You Should Work With A Buyer Broker
• What Kinds Of Home Are On The Market
• Benefits Of New Construction
• Short Sale VS Foreclosure
• What To Offer For That House 
• What Happens After Your Offer Is Accepted 
• What It REALLY Means To Be In A Buyers Market 
• Tips To Finding The Perfect Home

What Is It Really Worth ?

WHAT DO YOU OFFER FOR THAT HOUSE!

Let me start off by saying it is YOUR choice what you offer, but you want to put in a strong offer, it requires research and analysis by your Realtor. This is why you must always work with a buyers broker, this is where you believing in there abilities and trust is important. 

A home is not always worth what it is listed for, but on the other hand if the listing Realtor is a reputable agent than the list price will normally be accurate to what the neighborhood and the home is worth.   A low offer is not always the way to go, make sure your offer is fair!

When pulling these comps your agent will try to get it as close to a match as possible but you will still need to tweak these comps accordingly.  Here are some key points to remember when your agent is going over these with you. 

NEW VS UPDATED

NEW appliances have never been used, this means normally you will have the paperwork for the warranties, and they have been put in within 6 months of the home being listed.   

UPDATED appliances have been used by the current homeowner or tenant, these updates have been done usually within 5 - 8 years of the home being put on the market.  So that updated kitchen could already be 5 years old. 

For a home that is able to boast that it has been completely remodeled, with everything new can add value of anywhere from 8% - 10% compared to other homes that are simply updated.  

MAIN RD VS BUSY RESIDENTIAL NEIGHBORHOOD

This is normally quite the debate, I could name many roads that I would consider main roads in a town but when a bank appraiser comes in will not agree, and therefore they will make no price adjustment. This is a time when trusting your Realtor and seeing the comparison is very important, especially if you are not from that specific area. 

Let me also say this, if a location does not work for you for any reason you should never feel pressured to still buy it from your Realtor, they should offer to show you homes in the same area away from your objection area.  Some examples of this can be homes that have busier traffic patterns, sumps, or simply the privacy aspect to your neighbors. 

This will be your home and you will be the one living there for the next 15 years not your Realtor. 

WHAT IS THE BASEMENT REALLY WORTH ?

Let's say someone has a fully finished basement, with no CO, well unfortunately it is worth nothing, because it is not legal.  For an average size home, with a finished basement with proper permits, the value is surprisingly low they may only raise the value by $5000.  

If your looking in an area that does not have basements you can not reduce the price of the home because of it lacking a basement, because all of the comps do not have them either.  This is often a surprise to those who are looking to live closer to the water, most homes will only have crawl-spaces not basements, and there is no reduction that would be considered reasonable. 

THE MAN THAT WAS GIVEN A HOUSE NOT JUST A ROOM   

The garage typically you will have atleast 1 in some cases 2, and in the rare occasions 3 or more. 

When this happens I call it "The man that was given a house", and I unfortunately have to break the news to them that yes I personally appreciate their 5 car garage, painted floors, and custom shelving, but that means nothing to the bank or a buyer it doesn't add anymore value than a nicely maintained 2 car garage. 

WHAT IS A FEATURE WORTH ?

Unfortunately I wish I could put a value on what a feature is worth, but it is practically impossible.  Every feature will have its pros and cons to an individual buyer.   Some features will be worth alot to a buyer, and others will be a drawback. 

My best advice to home-owners is keep in line with your neighborhood when it comes to features.   Do not go overboard because you can not guarantee you can re-coup the investment you made adding features, but you can be sure that your home has similar characteristics as your competition does, so that buyers will be comparing apples to apples so to speak.   

For many home-owners their features are not added initially to keep up with the neighborhood, but because they were personal wants and needs for the individual.  If you choose to upgrade your home extensively more so than your neighborhood calls for,  I advise you to stay as conservative as possible because it could be helpful or hurtful in a home that has been updated, and is not able to be categorized as new. 

Steps To Getting That Home Under Contract !

I wrote a blog about a year ago, about what to offer for a home when your using comparable homes to base your price on, but I am finding more and more buyers wanting to base their offer on strictly their opinion of what they think the home is worth.   Because of this I decided that it was time to write a blog explaining HOW you go about deciding on what your first initial offer on a home should be from the very first step !

Now, again if your buying the home through the listing agent unfortunately they may or may not go thru the trouble of doing this with you.  This is again another reason to use a buyers broker, this way you have your own agent to educate you on what a home is really worth ! If the home is overpriced the comps will show you that, and if it is action priced your agent will be able to clue you in so you don't lose the house because of a low offer that is quickly outbid.

Step 1 

• Once you have gone and viewed them home and decide you like it, take the time and go back a 2nd time - look through the house thoroughly to see if there are any items you have questions about, if there are 2 refrigerators than make sure it says there will be 2 in the listing, these are things that if overlooked can cause you stress and anxiety later on in the process.  You will get the chance to have a home inspection after you have gotten an accept offer prior to going to contract to look for any issues with the foundation, electrical, plumbing ect.

Step 2 

• Make sure that you have your pre-approval in order and your agent has a copy of it, make sure you also have the funds available that will be needed.  Check with your mortgage broker and review what your closing costs will approximately be.  The reason why is because IF you are going to need a seller concession (cash advance on your mortgage), you must let that be known to the seller upfront.  All of this paperwork will need to be sent out when you present your offer so have it ready for your agent prior to submitting your first offer ! 

Those first 2 steps should take you only 1-2 days to complete, this is something that is really 

very simple but I am seeing more and more buyers who are doing these things after 

they submit an offer and than have to scramble to figure it all out ! 

Step 3

• Go and meet with your Buyers Agent, in their office - yes I said in the office, Why ? Because you can't review comparable homes if your leaning on the trunk of a car ! Hopefully you and your agent have been discussing the value of homes in the area, so that you will at least have an idea of what the value is worth.  

• IF a home is priced at its fair market value than you can safely offer 7% less than what the listing price is, most homeowners & Realtor will want to not or recommend going less than 3% - 5%. 

• IF a home is priced above fair market value than you will want to start around 5% less of what the fair market value is NOT what the listing price is - these homeowner can take sometime to get an accepted offer and sometimes you may have to walk away for a week or 2 and let them sit with no offers in sight and than go back to them.  
• IF a home is priced below fair market value than you will not want to put in an offer quickly, and around 3% less than the listing price if you are really not comfortable paying the list price.  These homes are priced to sell which means they will more than likely get numerous offers if you go in extremely low it will be easy for another offer to be a better deal for the homeowner.  

Notice that all three categories refer back to FAIR MARKET VALUE, you must look

 at the comparable homes that have sold in detail to figure this out since very rarely will 

you find a home that is an exact match to the home your looking at ! 

Step 4 

• Hopefully the process of getting an accepted offer went smoothly, the moment you get a accepted offer you will want to get a home inspector into the home within a day or two of your accepted offer.  You should let your attorney know so they are expecting the contracts, can review them and have them in case the home inspection turns up items that need to be addressed & than properly put into the contracts if need be.  

Step 5 

• Your offer is accepted, home inspection is complete, and the only thing left to do is sign your name on the dotted line ! Don't leave much time between these things happening remember a homeowner can go with another offer even if yours is accepted, until you sign your name on the dotted line the house is not yours ! 

Steps 4 & 5 should be completed within about a week, the longer it 
takes for you to complete these items you are leaving a window for the
 homeowner to receive a better offer !

Next weeks blog will be specifically about what things in a home are worth when you are determining the fair market value of a home that is on the market.  

How To Handle Offers On An Overpriced Home !

Finding the right house for a buyer can be tough, not only on the clients but on the realtor as well. When you opt to use a Buyer Broker it can be a bit easier but sometimes the only thing standing between your and your new home can be a seller.

When you choose to use a Buyer Broker they may show you homes that are priced above your price range, and you may wonder why, isn't that a tease since you can't afford the price. Remember just because a home is listed at a certain price it does NOT mean it is worth what the homeowner may want for it! Sometimes an agent will not take the time to educate a homeowner about the current market prior to listing the home or they may opt to go with their gut on price, this makes it much harder on all involved but it does happen.

When it comes to a home that is over priced in any area the negotiations can go a few different directions but will always require patience and strategy when it comes to putting in an offer. You will of course want to review the comps in the area carefully with your Buyer Broker, because you will want to be confident in your price being fair. Putting in a offer below the market value will make negotiations much harder, because your leaving a bigger gap between what you want to buy it for and what they believe the home is worth. When your agent presents the initial offer that is when you will normally find out why the home has been priced higher than fair market value.

Once your agent has put in your initial offer that is when you will begin to be to strategize what kind of negotiation style you will use when it comes to how you will counter.

If the homeowner comes down to a significantly lower price point it is a sign that their agent is educating them about what their home is actually worth in the current market. You will want to do the same with your counter in order to show them that you are a serious buyer! If your only around $10,000 apart in price sometimes offering to split the difference between is fair and will sometimes get you an accepted offer ! Remember whether the home is over-priced or fair value your best way to get an accepted offer is to put yourself in the sellers shoes!

If the homeowners barely budges off their price, either their agent has attempted to educate them with no success or they simply think the home is worth more as well. The conversation between your Broker and the Listing agent will clear up which one is the case.

This is where things can require quite a bit of patience, sometimes your best bet is to back off of a seller and give them time to sit on the market, and see for themselves that no one will buy their home for that price. It is a risk when you do this, and you should only do this if you have tried presenting at least 2 reasonable offers and your still significantly far apart on price. By far apart I mean over $20,000 and if the seller has not given reasonable counter offers !!

You will also want to be sure your agent keeps in contact with the listing agent, you don't want to wait to see a price reduction on MLS because than you may find yourself in a bidding war because of other buyers looking at the new price ! You shouldn't stop looking at houses either while you are waiting out a seller. Many times I have buyers who look at quite a few other homes in the interim and it helps puts in perspective what their money can buy. You may decide that your willing to pay a bit more than you originally decided for a home, or you may find a better home !

Once the homeowner has had sometime sitting on the market you will than see if they really want to sell their home, or if they were just putting it out their to see what would happen.

Before you place another offer on the house schedule another showing with your broker to go and see it again, ideally when you know the homeowner is going to be home. You want them to know your still interested in their home in case there agent doesn't remind them of your previous offers !!

Make sure when you present your next offer don't skimp out make sure that your agent reminds them of all the details of your offer.  You may still need to do a bit of negotiating but again patience is key ! If the homeowner is still not being reasonable you may have to continue to wait it out, you may end up finding a better home but I'm always certain for every buyer is the perfect home !

Most people think the number one reason to use a Buyers Broker is so that you don't over pay for a house, but that is not actually the most important. It's not always about making sure you don't overpay but also about making sure you don't miss out on a home because of trying to under value someone's home. The best reason to find yourself a Buyer Broker that you trust is actually to make sure you don't miss out on a home that would be a great fit for you period.

Do You Have To Sell Your House ?

There are of course times as a homeowner that you may have put your home on the market, and than life happens and you are either no longer able to sell, or you simply have decided this is not the right time for you to move.  Now depending on where you are in the process of selling your home is really the key factor here.  

On The Market With No Offers Or Contracts

If your home has been on the market for a day or a year, but you are not in contract you have the right as a homeowner to withdraw the listing from the market.  Now there is a difference in withdrawing and releasing your listing so you should pay close attention to which one the company is agreeing to.  

• Withdrawal - It means that the company is willing to pull the home off the market, but you will not be able to re list your home with another company until the original date of expiration.  
• Release - This is where the company is not only willing to pull the home off the market, and allows you to re list it with any other company before your original listing agreement.  IF you are pulling your home off the market because you are not happy with the company and the work they are doing for you this is what you would want for them to do.  

Things happen day to day, and sometimes a homeowners reason for selling can change quickly.  If your circumstances change and you do not want to sell for personal reasons your best bet is to call your agent and just be honest with them.  

We never want a homeowner to feel as if they are being forced to sell their home, but our job is to advise you what all your options are.  With the fall and winter coming upon us I am hearing many sellers say they are not sure they want to stay on the market because they believe that the market is slowing down.  This is only true to a point, and I have written about this quite frequently.  Although we do not have the same quantity of buyers, we have a better quality of buyers because those who are out looking in these months are considerably more serious than those who come out "browsing" in the spring time. 

On The Market With Accepted Offers

Now usually if you have gotten this far and accepted an offer something pretty drastic must have happened that you are not able to sell.  If you simply have had a change in circumstance and must stay in your home than you must advise the buyers in a timely manner, you also must keep in mind you will have to reimburse them those fees that they incurred such as the home inspection.  

Many times I see this happen is because a homeowner discovers they owe more than they thought, and the accepted offer is not what they need to sell.  You have a few different options before backing out of the deal, first you MUST inform the buyers immediately of this change is circumstance.  If you have suffered a hardship than a short sale may be an option for you, but your buyer would have to agree to this because it does change the terms surrounding the sale.  Your other option is to simply bring the money that is missing to the closing table.  

In either one of these circumstance again being honest with your agent is not only a must but you must inform them that these things could be potential issues before you list your home with them.  I can't tell you how many homeowners run into an issue because they hoped it wouldn't be a short sale and attempted although not to be manipulative kept it from their agent.  

Your Home Is Under Contract 

This is where it can get tricky and you really must be careful.   Most of the time the only provisions to be able to get out of a real estate contract is set up for the buyers.  If you are in a position where you truly can NOT sell your home than you should know that it is not always as easy as the buyers agreeing to it.  

• You will have to reimburse the buyers their out of pocket fees (deposit, home inspection fee, title fee, lawyer fees, survey fees, etc.)
• You do open yourself up to be sued by the buyers, in which case you can be forced to sell them the house.  They can sue for specific performance because your breached the contract, although this is a lengthy and costly process not all buyers are willing to just walk away.  
• Unfortunately you must also keep in mind that your real estate agent did their job, they brought you a buyer with a valid commitment to buy your home.  It is not up to the agent whether or not they pursue being paid for that work, it is only up to their company.  
• The buyers agent will also have the right to seek their compensation for bringing you this buyer.  Even if the listing company does not want to seek their payment, they will be sued by the buyers broker.  This is why many times listing companies are not left with much choice about whether or not they request compensation.  

For those buyers who are reading this because they are currently in the process of dealing with this, my best advice to you would be to try and salvage the deal if you can.  Keep in mind that life can throw curve balls at homeowners that they did not expect, and they may really not be able to sell.  It is obviously upsetting to lose the home, but there are many homes on the market your buyers broker will work hard for you but their was no way for them to predict this happening even for the listing agent many times this call comes as quite the shock. For all parties involved open communication and honesty is the best way to deal with this kind of situation!

What To Expect When Your Looking For A Short Sale !

Many of today's buyers are opting to take advantage of getting a "deal" on a short sale, now I previously wrote a blog explaining the process of buying a short sale.   I want to take a moment to explain a bit further not the process but what you should expect to see, and how you can prepare yourself for looking at these homes.  If you are looking for information on the process please refer to this blog.

So you have decided your going to get a deal, and you are on the lookout for that home you can steal off the market.  Well let me prepare you a little bit for what you may walk into, remember these homes are often time distressed or abandoned.

Before you even start looking at short sales you must remember a few important points.

1. There is still a homeowner involved even if they have abandoned the home, unless they have made other arrangements they first have the right to accept or reject your offer.  
2. You have the right to have a home inspection performed on the house, but that is as far as it will go there will be no repairs made to the home. 
3. Anyone looking into a short sale should also become educated on a what a rehab loan is, some of these homes will not be mortgageable and will require a rehab loan.  
4. "Sold As Is" means just that, many people assume that it just means that no repairs will be made but it also means that any CO issues the home may have not and will not be addressed.  

If that hasn't scared you off from purchasing a short sale, let me give you some reassurance.  Not all short sales are in bad shape and/or have CO issues.  Most of our short sales that are coming onto the market are actually still being lived in by the homeowner so let me prepare you a bit more.

• As I said earlier the homeowner still has the right to negotiate before any offer gets submitted to the bank, the chances of "stealing" one of these homes are slim because the bank will want at least 96% of what the market value is, and the homeowner will want the process to go as quickly and smoothly as possible so submitting a low offer would do nothing but waste everyone time.  

• Not every homeowner will be happy that their home is for sale, and to be quite honest some of them will be flat out rude to you.  Don't take it personal, and do not rush out on their account take your time and look the same as you would if the homeowner was being nice.  Sometimes getting into these homes can be a bit more difficult so you want to make sure you see everything while you are there.  

Those that are well versed in DIY projects, or who have family in construction are the most likely buyers to purchase and mortgage a distressed property.  When you are going out to these homes there are a few important things you should really be prepared for, and this is the most important part of this blog, remember this is specifically for vacant distressed homes.   

• Ladies, this first one is for you and I speak from experience when I am saying this.  DO NOT wear heals/skirts/open shoes when you are going out to look at these homes.  Even in this heat I would recommend wearing jeans or long capris rather than shorts.  Some of these homes have been vandalized and their could be glass, or debris laying around and worst case there can be mold in some of the areas of the house or exposed insulation that can irritate your skin.  

• Bring your flashlights and be prepared to use them, even on the sunniest day these homes can be eerily dark.  Most of the time this is caused by the boarded up windows, and doors but the lack of electricity at night is always an issue.  You will also want to consider bringing some hand sanitizer, some of these houses can be a bit on the dirty size so if you are anything like me you will be very happy to clean up a bit after being inside.  

• View these homes during "normal" hours, this is all about your safety.  You will have to use flashlights to see and your site will be way to limited in the evening hours.  There is no way to know if squatters have been using this home for a warm place to sleep, and viewing these homes in the late evening hours is just not safe.  

• NEVER close the door behind your agent, again this is all about your safety as well as your brokers, you never know what your walking into.  By leaving the front door open you are making it clear to those neighbors and other agents who may be showing that you are in the house, and they will be able to hear you inside god forbid something is to happen.

Now I know that all that may make you think it is not worth looking at short sales at all, but it is rare to see homes in this extreme distress anymore.  It is much more typical that the homes are still being lived in or taken care of by neighbors but I have quite a few buyers who are looking for this kind of project coming to me over the passed few weeks.  The best way to find the short sale that is right for you is to talk open and honestly with your agent, here are a two easy ways we can help you before you even step foot into one of these homes.   

• As brokers we have access to things that you do not, if you would not consider a home that would require a rehab loan we have the ability to check the agent listing to see if the home would require one or not before you go and look at it.  

• Many of these short sales will not have pictures attached to the listing, don't discount them just based on that if you are nervous about seeing these vacant homes because you would only want to do cosmetic work, see if your agent would be willing to preview them for you.   

The best piece of advice I could give you when your buying a short sale is to expect the unexpected ! Short sales are not for everyone.  The good news is that we are not seeing any large amount of short sales coming onto the market at the rate they were in previous years, and we are slowly seeing these homes sold !

If you are looking for additional information regarding the purchase of a short sale property and have additional questions were not covered in this blog please feel free to leave your question as a comment, or email me directly!

Why Should I Use A Real Estate Attorney ?

It is time for another blog directed for both the buyers and sellers at there whose home is either on the market, or are thinking about doing so.  The one thing everyone must be prepared to do is find an attorney that they like, and trust.  Don't just pull someone out of the phonebook, either ask your real estate agent for a referral to one that they have worked with before.  If you are a buyer, than you should be working with a buyers broker so your agent will be able to refer you to one as well.

Not all states require the use of attorneys during the purchase of a home, but even if you are buying a home out of state I always  recommend you use a attorney to protect yourself from entering into a contract that is not in your best interest.  That being said, it is time to get to the point of this blog which is why you should be using a REAL ESTATE ATTORNEY, notice those 2 words in the beginning says real estate.  There is a saying, you can only do one job well.  Attorneys can do many different things divorce, elder law, criminal law, family, ect.  and each one of these areas have its own set of rules and quirks.  Do not use an attorney who does not specifically work on real estate transactions, and I don't mean someone who does them whenever they are requested to.  You should be using someone who does it every single day, because you want this attorney to know absolutely everything they may need to to help you during this transaction.

I happen to be very lucky and we have quite a few attorneys who are on our preferred attorney list, and they have only earned a place there because 1.  They are real estate attorneys and 2. Our clients have told us what a wonderful experience they had working with them.  We do not add attorneys to our list and let them stay there just because, if we get complaints they are removed.  A common mistake is that people choose their attorney based on price, and I understand the concern over the money when your making such a large purchase but take into consideration that a good real estate attorney can cost anywhere from $800 - $1200 for the entire transaction, it is well worth it.  Plus many general practice attorneys will charge a higher rate, or even an hourly rate for your file so you will end up spending quite a bit more if there is even the smallest hiccup.

I have worked on some very hard deals, and the only reason they closed was because of the  options that the Real Estate Attorney offered to them, at the same time I have had attorneys almost kill a transaction over something completely avoidable just because they weren't aware of a simple resolution.  Sometimes after the bidding is done, and the attorneys are involved your agent will need to step back in and play the middle man, you should never feel pressured by your agent but understand they are trying to be the glue that keeps you on track to either buying or selling your home and that is what you hired us to do!

Let me give you an example of the difference in what COULD happen during a transaction where a Real Estate Attorney was not involved.

A deal is made and signed by both buyers and sellers. 
Seller agrees to close within 30 days on a cash deal, but the house will be sold as is.
Buyer agrees to close within that time frame, and agrees to the contingencies which go along with a cash transaction.

Attorneys are contacted and asked to send out the contracts to both parties.

Contracts come back and buyer is "requesting" home inspection with repairs to be made, and/or credits and adjustments.
 
You are always entitled to a home inspection but homes that are being sold as is, mean exactly that AS IS.  Non real estate attorneys will often overlook this and send out a standard contract, and it will start a un-needed disagreement.  This is something we commonly see with estate sales, short sales, and foreclosures.

The sellers opt to not sign into this contract because it does not meet the terms of the original agreement that was made, and the agent is not due to check in with the attorneys for another day or 2 and is not contacted regarding this hiccup.

Now if a real estate attorney a few things more than likely would have gone differently because

• The attorney would have taken specific notice to the terms/closing time and checked with his/her clients regarding what was being represented in the home and what was not. 
• The attorney would have been in direct communication with the agent which would have allowed the 3rd party mediator AKA The Realtor to review original terms of the transaction with his/her buyer eliminating the problem in a timely manner before it escalated.
• If the issue was something simply fixed this can sometimes be done via a verbal agreement that does not require money held in escrow.  

Please keep in mind this is just an example, sometimes transactions where non-real estate attorneys were used have gone thru with no issues at all BUT this is a big decision you are making.  Would you go to your general practitioner if you were having a heart attack ? No you would go to a emergency room, sure the GP might be able to help but what if it doesn't ? This may seem extreme, but you have no idea what it is like to see someone lose their dream home! 


There are 3 circumstances that you absolutely, positively must use a real estate attorney.

• Cash Deals: These deals can be tricky because they have very specific terms as far as what is being represented and your closing date.  

• Short Sale/Foreclosure: Banks are hard to deal with, and in this case it is who you are not only buying your house from, but it is also whose financing your loan.  There must be a direct line of communication to the banks, your lawyer needs to be educated on what these processes are.  

• Estate Sales:  This is where it gets tricky because there is usually more than one seller, it usually involves family members who are not familiar with the what is legal on the home and what is not, plus the condition is not always all that great.  It also comes down to how the home is titled and who needs to be present for the closing, and what paperwork is required.  

Now for those of you non-believers lets also look at another reason why you need to use a Real Estate Attorney, and it has nothing to do with the Attorney or his knowledge.  An attorneys staff is also important, they are usually the ones drawing up the contracts and who is contacting all the parties involved.  Keeping with the Dr analogy if you were having a heart attack, and the nurses assistant told you to just go home you would end up in quite the pickle but she may assume it was just a bit of heart-burn, even though she meant no harm it can cause a big problem for you! 

Sellers On The Move !

I recently wrote  a blog for the buyers to give a breakdown of what you should be doing after your offer is accepted, and what they will need to do.  This blog is directed for what the SELLERS need to begin to do and prepare themselves for.  Most would think that the sellers have the easy part, they just sit back and wait for the closing to be set but I am finding for every educated seller there are more that are not really clear on what they need to be doing.

Just as a buyer has things they need to be doing, you as the homeowner also have things you need to be doing like packing, or finding your new home.  Homeowners who are buying a new home are usually diligent about getting their search underway before their current home is even in contract. I am finding more homeowners that either A. Already have a home and do not require a purchase or B. Homeowners who are opting to become renters are often unsure of when they are supposed to make their move and what will be happening after they have accepted an offer.

Disclosure & Home Inspections 
I did write an entire blog about the home inspection process for sellers, but I wanted to touch base on it again just for a moment.  The two most important rules to home inspection are:

1. DO NOT try and hide or cover-up anything in your home, it will make you look secretive and cause the home inspector to search harder to make sure they didn't miss anything.  Things that you may consider a big deal, may not be to your potential home buyer.  An example of this is lets say you have one leaky faucet, so you decide to shut off the valve completely obviously the home inspector is going to check, and with the valve completely turned off they may think it is more than what it actually is.

2. BE REASONABLE, if one home inspector finds an issue I can guarantee you any other that comes into your home is going to find the same one.  These are trained professionals and although your Realtor will be there to protect you we are by no means experts in home construction.  If there is a safety, or structural issue you can not expect a potential buyer to just take your word that it isn't a big deal, and they can live with it.  If they have gone thru the process of spending money for someone to protect them from buying a home that they will not be able to handle you must respect that.  You do have options, you can ask for a 2nd opinion from a licensed professional who works specifically on that issue (ex: Electrician, Plumber, Roofer) to give an estimate for repair or confirm that the point the inspector made was not one that should have caused so much concern therefor making it a non-issue for the buyer if they are comfortable with that.  If the professional confirms with the inspector that something must be done to rectify the issue you still have options you can either repair it, or credit the buyer so that they can have it repaired prior to moving in.


After you have completed and negotiated through your home inspected, you as the homeowner must make sure that everything you needed to disclose has been done.  If you "forgot" to mention and illegal add-on or that you are taking that dining room chandelier now is your last chance to clear the air.  Everyone is human, and sometimes things will slip your mind when you are signing your listing agreement and answering your agents questions.  Sometimes these things are what can make or break a deal, just because you may see it as not a big deal the only person who can truly tell you if it is important or not is your agent so be sure to be open and honest about these things.  Nothing is worse than having a wrench thrown into a deal that could have been avoided not only does it cause fixing by your agent, it could very well cause you to lose your buyer!


Signing The Formal Sales Agreement
This is not always required but for my clients I always like to have all parties sign the original sales agreement to have it on record.  This agreement does not only include the purchase price and the down payment it also includes your on or about closing date.  It seems to quite often be overlooked but we as Realtors need to begin making a real point of explaining, and than re-explaining what this date means to your homeowner.  The on or about date is 90% of the time what your attorney will put in the contract if you think for any reason you need more time than that date, make sure you inform your Realtor as well as your Attorney.

If the buyer is purchasing another home this date won't just effect you and your buyer, but it effects the buyer of their current home.  The effect of a closing date being drastically changed can cause them to lose their buyer, which puts your deal very much in jeopardy.  Just like a buyer must respect that the home is yours and they can not push you out, you must also respect their time and situation.

When you receive an offer on your home we will tell you if the buyer has anything he/she needs to sell, in the case where the buyer does not we will point out the fact that this is a good buyer because they are not being held back by anything.  This also means though that this buyer is more than likely renting and will need to give notice, which makes that on or about closing date very important.

This is a very important date to your buyer, if they are renting they will be in a position of potentially being homeless if the closing does not happen in a timely fashion of this date.  You may be thinking that no landlord would ever put someone out on the street but it is very much a possibility.  Your buyers can be penalized for overstaying there welcome and that can cost them anything from an additional months rent, to a daily charge which can become costly quickly.

Signing Your Contract
This needs to be done in a timely fashion for 2 reasons.

First is that there are plenty of homes coming onto the market, and what if a better one comes along and your buyer falls in love with it? They are not required to stick with your deal until your contracts are fully signed and if you are dragging your feet than you can not have hard feelings if they move onto the next one.

Second, is because unless you changed your on or about date the clock has begun running towards your closing date.  Your buyers need that contract to put in for their mortgage if you hold off it will take them longer to obtain the mortgage commitment which generally takes 6-8 weeks. You must respect that they need to move just as you do in a tight time frame because there is a lot to be done in that time frame.

Closing
I always keep my homeowners very much informed about the progress their buyers are making towards closing, because in order to be fair to all parties involved communication is key.   Without proper communication things can turn bad, very quickly and make the experience unpleasant for all parties involved, including the Realtors because unfortunately are usually the messengers that will carry your bad news to your buyer.

If you are purchasing another home you should be constantly checking progress on that deal  this way if there is any unexpected delay you are able to communicate this to your realtor who in turn can inform the other agent.  This respect needs to go both ways, if your buyer has hit an unexpected snag they must also communicate this, so that you are fully informed.

Now this may seem silly BUT when you listed your home your agent will have asked you where were you going after your home sold, if you told us you were moving to your 2nd home that is where we think you are going.  If over the course of the listing changed your mind you have to inform us we are not mind readers, and we will find you a rental but only if we know you need one.   Finding a rental for anyone whether it is a 1 bedroom or a 3 bedroom is a task, because not every apartment is available for immediate occupancy.

You have to respect that your buyers have given someone notice that they are leaving where they are currently living, someone might be moving in the day they leave so even a day or two delay can become a big issue when left till the last minute.  Just like they can not be unreasonable regarding their moving in, you can not push things to their limits and expect the buyer to be happy about it.

I did mention communication, respect and fairness quite a bit in this blog, which I don't normally focus on but these are 3 things that can help prevent ripples from turning into tidal waves of frustration.   Whether your selling or buying a home it is a huge decision and as Realtors we chose to do this, and it is my opinion we should always try our best to make sure you are informed of even these basic guidelines to ensure things go smoothly.  

Cash Deals In Today's Market

I thought it was about time I took some time and wrote a blog about cash deals in today's market.  Interest rates are at a all time low still, but some buyers are still opting to buy their homes in cash figuring it will earn them interest quicker invested in a property than sitting in the bank.  If you are the buyer who has the ability to buy in cash you do have the upper hand on some other buyers, but not all.  This blog is for both the buyers, and for sellers to help both understand how a cash deal works, benefits of accepting a cash offer, but also how/why a seller may not be able to accept a cash offer.  

Presenting A Cash Offer

There are certain steps to presenting a cash offer that you may not ordinarily have to do, normally when you present an offer with a mortgage you would be presenting the offer with you mortgage pre-approval.  When you are doing a cash deal you will need to provide "Proof of Funds", this must be  recent, if your proof is 3 months or older you must get a new one.  Generally you can contact an agent at your bank and ask them to provide you with a letter, or even simply a copy of a recent bank statement with your bank account information hidden with only your name and available balance displayed.  

If you are purchasing your new home, with the cash from the sale of your current home than you must let this be known in the very beginning of negotiating.  Before you can place an offer, just like any other buyer you should be under contract on your current home.  

Benefits Of Cash Offers 

A seller may or may not prefer a cash offer because of the benefits it presents to them.  Not all homeowners are in a position to accept a lower cash offer because they may have a certain amount they need to "clear" on their home.  There are benefits that can make taking a lower cash offer vs a higher offer with a mortgage appealing to a homeowner.  

• No Bank Appraisals - This is pretty simple to understand, you do not need to worry at all about whether or not your home appraises because there is no bank involved which can sometimes be an obstacle.  

• No Loan Funding Contingencies - Whenever someone obtains a mortgage there are certain paperwork the bank will require from them, if they can't meet those requirements they will not be able to obtain the mortgage.  This can sometimes be avoided by using a good mortgage company but their are no guarantees, financial circumstances can change quickly and unexpectedly. 

• Home Inspections - Every buyer is entitled to a home inspection, but generally with cash deals the home is sold "as is", which means there will be no repairs or credits done to the home.   This is because generally homeowners are already accepting a lesser offer because of it being cash.  

• Faster Closing - It generally takes 60-90 days to go to closing on a home, the time frame is usually decided by how quickly a buyer can get the mortgage commitment, and close.  With no bank comes the benefit of being able to close at a time that is good for both the seller and the buyer.  

I have many homeowners ask me when is the best time to accept a cash offer vs waiting for a buyer with a mortgage pre-approval, unfortunately there is no set criteria but I can give you some pointers on when or why you should consider it.  

• If you need to move or relocate quickly, no one likes the idea of leaving there home vacant because of the risks and costs associated with it.  
• If you have your eye on another home that is on the market the benefit of having your home go to contract quickly will in turn mean you can put in a stronger offer for your new home.
• If the home is an estate sale it may need work, or you may not know the full history like the actually homeowner would.  Homes that need work will generally take longer to sell, which is why a cash offer allows you to move the home quickly reducing costs, as well as risks while giving you less responsibility after your home inspection report comes back.  

Always remember your Realtor should be advising you whether or not a cash deal is a good option for you, this goes for both buyers and sellers.  If you are the buyer placing a cash offer, my best advice is to make sure your Buyer Broker has helped you come up with a fair offer, remember there is a difference between a cash offer and a low offer ! For homeowners that have received a cash offer the process of deciding whether to accept it, or perhaps counter all depends on your home, situation, and the market for your immediate area. Your Realtor will be able to pull what cash sales have closed to help you make an educated decision about what is a fair offer for your home! 

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!