The Top 5 Tips For First Time Homebuyers !

I decided to spend a moment and focus on buyers for a moment.  I have a lot of information for my sellers, but when it comes to working with buyers I would have to say first-time home buyers are my favorite.  Perhaps I like the "challenge" but it is a different kind of reward when you hand someone the keys to their very FIRST new home ! 

Get Your Finances In Order

Before you start working with a buyer broker, getting a mortgage pre-approval is a must.  I have seen too many homebuyers starting looking before they find out what they can afford.  The result is disappointment that you may have looked at some wonderful homes that turns out does not fit into your budget.   Most licensed brokers will have reliable, and attentive mortgage brokers they work with that they will be able to refer you to. 

Know The Language 

Know the terminology of real estate, you want to understand what brokers are talking about.  Short sales vs Foreclosure, there is a very big difference.  You want to be sure even when you are looking without an agent you have a good understanding of what everything is.  You need to understand the difference between Listing Agents, Buyers Brokers, and disclosure.  Listing agents obviously list the house, and work for the sellers.  Every first time home buyer should work with a Buyer Broker, they will provide you with information about the homes in the neighborhood your looking for, make sure everything the seller is representing is true !

Find A Good Buyers Agent

This is the most important part for a first time home-buyer, you are going to be depending on this person to help you make a life changing purchase.  You need someone who is okay with having to “hold your hand” so to speak during the process, not because you need it but it is a resource that is available to you.  I once stayed in a closing with my first time buyers for 5 hours, it was a short sale and the bank was having its own issue with paperwork which held us up.  Before leaving the attorney, pulled me aside to thank me for staying and explaining what was going on to his clients.                  

Decide What You “Must Have” And What You Would “Like To Have”

I had a home buyer once tell me that she would never purchase a ranch they would never give her the space she needed.  For the most part she was right, almost every single home that was a ranch would not meet what she needed to have.  Before we began looking I asked her to make me a list of her “must have”,  and “like to have list”.  Must haves are the number of bedrooms, a school district, or a price range.  These are things that if they did not have them it would be impossible to move to that home.  Fireplaces, pools, central air, these are all things that you would like to have but, you could live without.  These lists are different for everyone, in this clients case the home she purchased ended up being a ranch.  If we had limited the search she would have missed out on her “perfect home”. 

Should I Spend The Money To Have A Home Inspection?                                                                                                                                  

Absolutely. The $200 to $500 that a professional home inspection costs could be the best money you ever spend on your house. Not only does the home inspection seek out any defects (and gives you some peace of mind), the home inspector will often give you tips on maintaining and repairing your house. See the section on Home Inspections for tips on what to look for and how to choose a home inspector.

For more information on Buyer Brokerage Take a look at my virtual presentation ! 

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!

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 First Steps To Buying Your New Home

It is time for me to write some blogs for the all the buyers, some of which are new to the market and for those that have been looking for their dream house for quite sometime already here is your reminder for all the things you should be doing ! Over the next few days I will be writing blogs specifically for you, so be sure to keep checking back every 2 or 3 days for a new Buyers Blog!

                For those buyers who have just begun your search there are a few steps that you should take in order to make this process as enjoyable and stress free as possible!

• Go thru the pre-approval process, and get a PRE APPROVAL LETTER & YOUR ESTIMATED CLOSING COSTS 
• Find an agent that you are comfortable with, and understand your wants & needs, this is a BUYERS BROKER 
• Sign up for a LISTINGBOOK ACCOUNT
• What are YOUR WANTS VS YOUR NEEDS  

            I have heard many reason why a potential home-buyer does not want to go thru the pre-approval process, not often have any of the reason been reasonable.  The problem with not getting your pre-approval is that sometimes you end up looking at homes that are not a possibility for you, there are a few different variable when it comes to your pre-approval it is not only about price but is about your taxes as well.  Once you have looked at these homes, nothing will ever compare to them.  On the flip side of that, I have had clients that were able to afford more than they had originally thought they would be able to, and were able to look at better homes than before.  You also must take into consideration that all money that changes hands during a real estate transaction must be accounted for, the bank wants to know where you got the money from.  You don't want to find that once your in contract on a home, that you will be unable to afford the closing costs, and go thru the process of proving to the bank how you ended up coming up with the money they required.  

             

Now, finding an agent that you are comfortable with is also very important I talk about this in every blog I write for my buyers and I am always asked why.  Just like there are 2 sides to every story, there are 2 sides to every deal! In whichever home you choose to buy you are paying for the broker to work for you, so wouldn't it make more sense if your paying that person to make sure you get what you paid for ? Another aspect to using a buyer broker is of course the legalities of disclosure, and fiduciary duties that we must abide by but think about what they do for you in between! It is always good to have a 2nd set of eyes looking for that perfect home, someone to call to find out the answer to your question  you have about the house you drove by, or what about someone to drive you around to look at homes ? 

              

This agent will more than likely offer you a listingbook account and if they don't I suggest you ask for one! This website is much better than MLS because it saves your preferences.  When you have to do a "fresh search" each time you go onto MLS, Trulia, or Zillow you are seeing many homes that you have already seen, and many times will overlook a new listing because of it.  Listingbook also allows easy communication with your Realtor by leaving property notes, so you can receive a response online if you are unable to be on the phone. It also allows you to watch homes, mark favorites, set up open house itinerary, or reject homes completely! 

             

Now this last one is tricky for alot of people because they can not clearly define what they want, and what they need for a home to have.  There is only 1 thing about a home that you can not change, and that is location so clearly if you find a dream home for a great price but it is not the location where you NEED to be than the house is obviously not your perfect house.  Now let's say you find a nice home, in the area you want, but it is missing a fire-place or jacuzzi tub - those are not needs they are wants be sure to understand that in each price range there is a home to fit all your needs, but your wants usually come down to personal preference and style.  You also can not penalize a homeowner because of their style or personal preference when it came to renovating/updating their home.  

Once you have gone ahead and done these first few steps you are able to begin the hard work of going out and finding that perfect home.  This means weekends of open houses, appointments for private viewings with your broker, conversations with your broker that you may not like but have to have. I will never tell you that finding your dream home will be easy, but I do believe as Realtor our job is to make sure you have the best experience possible.  You will walk into homes that the owners couldn't pay you to buy it, you will sometimes have yourself a good private joke at the thanks to a homeowners taste in color, or style, maybe even a few free lunches courtesy of your broker! 

The most important piece of advice I could give any buyer is let it be an enjoyable experience by having open and honest communication with your Realtor, you may not always like what we have to say but you will love us when we hand you the keys to your perfect home! 

Why Should I Work With A Buyer Broker ?

THE LISTING AGENT DOES NOT WORK FOR YOU!



I wanted to take the time to explain exactly why you should work with a buyers broker, it is a common misconception among buyers that the listing agent can represent you and the seller.  Of course their is a legal way for them to do this and it is called Dual Agency, it is so controversial that many offices have a policy that they will not allow it, and New York State requires additional paperwork to agree to it.  I personally prefer to allow the buyer to work with another agent, I beleive to do my job 110% for my client I can not do both.  So I have decided to take the time to explain exactly why working with a buyers broker is so important. 

Well first and most likely the best part is it is free.  There are very rare occasions when I home being sold my a homeowner rather than an agent there will be some discrepancy of who is to pay the commission, but any home listed with a Realtor will result in the seller paying the compensation. 

Second, you have someone in your corner, that will do all the “homework” about the home for you.   The most important aspect to a home is the price, and the homeowner and the listing agent will choose that price.  Having your own “expert”, will ensure that you don’t overpay for the home because they will be working exclusively with your best interests in mind. 

The difference between a listing agent and a buyer broker comes really down to the law.  There is a difference between what a listing agent has to tell you, and what they choose to tell you.  The home has a leak in the roof but it was fixed and it hasn’t leaked in about 6 months, they don’t have to tell you that.  A buyer broker over hears the agent and homeowner speaking about the same leak, we now under law have to tell you.  Why? Because we are working with your best interests in mind, now if you put in an offer you can specify to the home inspector there was a leak to be sure it was fixed properly.  Another example and the most common, is when it comes to the price of the home.  If a home is listed at $350,000 and the home down the block sold for $325,000 you obviously have some room to negotiate.  Even if the seller will go down to the lower number a listing agent by law can NOT share that information with you ! A buyers broker will be aware of that neighboring sale and use that during negotiations with the sellers. 

The buyer broker contract, is not so much of a contract as a promise.  If you choose after looking for a few weeks that you want to save more, or just hold off no agent would have a problem releasing you from your contract with them.  This is a way for both the buyer and the agent to both be on the same page, as far as what is expected from each party involved.   

No one should expect someone to sign into a contract without meeting with them first, I personally will go out a few times with my buyers before asking for them to sign a contract.  This gives them the chance to see how I run my business, and if it works for them.  Buying a home is a huge decision and you will be spending a lot of time with your agent.  If your going to be spending Saturdays with your agent not only should they be good at their job, but you shouldn’t mind being around them for the entire day.   

That being said, I also like to remind the buyers out their that the agents are working for them.  If you do not actively participate your home buying process will not be easy, no agent is a mind reader.  If your agent keeps taking you to see a style of a home you don’t like, you need to voice that to the agent.  Will they still take you to that style of home ….. yes ! But if they do it will be because this offers something different, and would really wow you!

Lastly it is something that some in the real estate world don’t often mention, and that is TIME!  You don’t want an agent to waste your time and they obviously do not want to waste theirs either.  When my buyers is dedicating their time to me, I now have a vested interest because they are counting on me.  If someone I have been dealing with for 6 months still will not sign a buyer brokers contract, I will be wary if they would just make an impulse buy with another agent.  I could very well be wasting my time and just be a tour guide to this person, and my time could have been spent with someone who really needed my help and advice.   If after 3 months if you are still not comfortable signing into a buyer brokers agreement for any length of time, I would suggest finding an agent who makes you comfortable enough to do so.  Whether you sign into an agreement for a month or a year, this is a very important piece of paper for everyone involved in your home buying process!

Are Full Service Real Estate Agents Worth The Money ?

Consumers are always looking for ways to save money, and paying real estate commissions can amount to tens of thousands these days. Not an insignificant sum to most people. Is it worth it to hire a full-service real estate brokerage over a discount service? Reasonable question. It's one I hear often. And the answer is it depends.  

Type of MarketplaceIf you're in a seller's market right now, homes are probably selling the minute they hit the multiple listing service. A one-eyed sheep with two paws tied behind her back could plop a home into MLS and get an offer. Will it be the highest price you could get?
Buyer's markets exist when inventory exceeds the supply of buyers. In these markets, some homes aren't selling at all. This is where expertise and extra work pays off. Listings that sell at top price are typically those exposed to the most buyers, which are priced well, marketed well and show well. 
MLS and the Internet
I cringe when I see new listings hit MLS without a photograph because I know that agents and buyers are passing them over without a second thought. Many multiple listing services accept 8 to 12 photographs nowadays. For that reason, many full-service agents hire professional photographers and shoot double the photos required.                      * The pros spend considerable time sorting through photos to select those with the most light, the best angles, sharpest contrast & color.
                    * Photos are cropped and resized to accentuate positive attributes.
                    * Each photograph is entered into MLS with a full-length enticing description.

When I see a photograph taken by the multiple listing service instead of a pro or the agent, I also see a lazy real estate agent who doesn't care enough or isn't getting paid enough to properly market her client's property.  
Signage
Lots of mom 'n' pop operations and discount brokerages don't spend money on professional signs because they don't believe in it or they can't afford it. Good signage is free advertising. Many full-service firms will advertise:
                    * Main office phone number
                    * Agent's personal cell phone or voice mail number
                    * Web site for more information
                     * Virtual tour links

Marketing Materials
Full-service companies tend to project quality, and that means four-color flyers and four-color direct mail pieces. The days of hiring neighborhood kids to toss photocopies on neighbors' front steps are gone. Full-service marketing is first class.  
Open Houses

Not all homes are right for an open house, but those that are require finesse. This means working the buyers who come through by pointing out impressive features of the home without making the buyer feel oppressed or hounded, and that in itself is an art. It requires the service of an experienced sales person. Many discount brokers refuse to hold homes open.
Full-service agents counsel sellers. They find out what made the seller decide to buy the home and how that moment happened. Then, they employ that knowledge at open houses. For example, suppose a seller said that moment came when she first stood gazing out at the pool. When she turned to her husband and gasped, "I can't believe we can afford to buy this home." Good sales people at an Open would ask buyers to stand in that same spot by the pool. Then, they'd share the seller's first experience verbatim.  

Negotiation
Real estate is an extremely competitive business, and there are many agents fighting for the same listings. A full-service agent who wins the listing is probably a good negotiator, a person you want on your side during offer negotiations. Think about it. Agents who can persuade you to pay what they feel is reasonable, will probably persuade a buyer to pay your price. Ultimately, that means more money for you.
Final Sales Price

Sometimes full-service agents lose listings because the seller was promised a higher price based on hot air and a lower commission. It's these listings that often show up in MLS a month later with reduced prices. The amount of the price reductions, not surprisingly, tend to exceed the difference in commissions between the dualing agencies! In these scenarios, sellers received fewer services and ended up losing money on the sale as well.
If you can't decide between an agent who charges 1 or 2 percent less than another, think about how you would feel if you had to reduce your sales price, say five percent, to get the house sold. Ask the agents to show you their last 24 months of price reductions and compare them.

How Much Do Agents Make?
Agents are paid by brokers. Brokers retain a portion, sometimes 50%, and pay the balance to the agent. From that, the agent pays her overhead and taxes, which can easily amount to 50% of the net. A listing agent's true salary ranges from 20% to 30% of one-half the commission. Full-service agents typically spend more on overhead than their competitors; by refusing to compromise service, they tend to charge more.

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 !