Mama Liz's Blog: July 2009

 

Many of you know that I recently bought a home. 

And, for those of you that don’t know that I recently bought a home…I recently bought a home.  Here’s proof.  

Although we are very happy with our home we did purchase, during this process, I happened to notice that as we viewed house after house, I kept seeing the same things happen over and over.  And….not good things.  Bad things.  Bad things that were blatantly obvious to me.  Bad things that literally turned me off.  Bad things that were keeping this otherwise fine house I was standing in from selling faster.

So, as we went through the homes, I started keeping track of things that I saw that made the average buyer – ME – want to run away screaming.  Here is my “Top 10 Seller Sins”:

1. Addition Addiction – Ok…exactly what were these people thinking when they added this addtion to their home??  It isnt level.  The door frame isnt square.  And, that simulated wood-grain indoor/outdoor burber carpeting is HIDEOUS!!  Wasn’t this were the garage should be anyway??  I guess that explains the severely sun-faded paint job on the Sport Family Truckster in the driveway and the Christmas decorations piled floor-to-ceiling in the closet in the spare bedroom.  I don’t care what anyone says…Bigger is NOT always better.

2. The “Pet-Owner Moaner” – The over-all assumption that since the seller loves their pets more than chocolate, so does everyone else.  Here are a couple of quotes I heard directly from the sellers mouths: “Awwww, my cat must really like you to nestle into your neck like that.”; “I know he looks big, but he is really just a teddy bear.”; “We were able to clean up everything in the house except the cat room.”; “I cant remember if my son put away the ferrets or not, but feel free to look around downstairs.”
a.  Ok…first and foremost, Im allergic to cats.  I don’t mean that cats make me sneeze.  I mean that I quit breathing and require adrenallin shots to keep from dieing.  That thing is lucky I didn’t toss it out the open window that was next to me. 
b. The “teddy bear” they were referring to…Yeah, that was a 158lb Rotweiller with a googlie eye and a broken tooth on the right side.  His chain was tied to a cinder block that he happily drug around and tossed into the air during “playtime”. 
c. The “cat room”???  Oh Lord in heaven!!!
d. If you cant figure out if your son left out a pack of rodents in the dark rooms down the creaky stairs without a safety rail and a working light switch, you can be damn sure Im not going to find out for you.

3. Auditory Unawareness – If you cant hear that your refridgerator is making a clicking noise that can be heard from the front yard, Im fairly sure you cant hear the floorboards creaking, the doors squeaking, or the apparent family of raccoons living in the attic.  You also only hear what you want to hear.  Instead of “Your house is priced too high”, you hear “Your house is of a high value”.  Its not the same.  Pay attention!

4. Color Blind – Holy Lord!!  Who decorated this place??  Its like Andy Worhol threw his color pallet into a Cuisinart and hit ‘liquify’.  The fuscia flower print wallpaper needs to go.  And, I don’t carew what you say, it doesn’t do any justice to that wall with the fake woodgrain panelling it joins up to by the sunshine yellow couch.  Worse yet…the white cabinets, white-washed walls, white countertops, and white tile is just a bit much. 

5. “Take it or leave it” – Yup.  Heard that come right out of a seller’s own mouth.  We were discussing the possiblity of him making a necessary repair to a sliding glass door that lead out to a deck.  Between the glass panes was about half an inch of standing water.  Obviously, the seals on the window were compromised.  When asked if he would spend the money to get the glass replaced and the seales re-done…or just replace the entire door…that was the response I got.  Guess what…I left it.

6. Price-itis – The fear that your home wont sell for the price you are asking for it.  I put in an offer on a home that was only $5,000 under what was being asked.  The counter came back with a reduction of $1,000, but a clause to pay $4,000 in closing costs.  Now, I may be bad at math…but, isnt that the same damn thing???? 

7. Fried Food Funk – You know what Im talking about here.  If you can smell it, you won’t sell it.  Bottom line here is that fried food smells, kitty litter, a back yard filled with dog crap, a nursery reaking of dirty diapers, etc…all add up to one thing – a very short showing.  (Well, it also leads to gagging, shortness of breath, tears streaming down your face, and everyone skrunching up their nose and making that internationally known face that says, “Do you SMELL that???”)

8. Photog Fog – Everyone should take pride in their family photographs.  I do.  But, Im not trying to sell my house!  I went into one home where, I kid you not, the entire living walls…every square inch…was covered in frame pics of family.  There must have been 100 pictures in that room.  Frames mounted together like a patchwork quilt of memories and bad matting jobs.  Love the sentiment…love the family pride.  But, I was COMPLETELY distracted from seeing the actual house. 

9. “I collect them” – No kidding, really???  Nothing would have made me realize you collect dolls were it not for the fact that Im now suddenly very aware of the fact that 226 eyes are now following me through your house like Chucky with an ax to grind.  Yeah, I couldn’t tell that you collect Vegas casino ash trays since they are on every flat surface in your entire house including 4 separate 6-ft tall bookshelves, your coffee table, the top of your TV, the end-tables,  and the extra two shelves that you put up encircling the entire living room.  But, worse than that, you have them on your toilet tank, your dresser…and in an amazing twist, you have drilled holes in them and replaced half of the doorknobs in your house with them.  In case your agent hasn’t told you this….PACK THIS CRAP UP!

10. Livin in the past – I don’t care what you think, the pea soup green shag carpeting is not coming back in style.  And, regardless of how many memories are associated with it, the nine-foot long, hunter orange, faux-leather couch on the wooden legs with the sleigh-style arms on the each end is FREAKING UGLY!!  Regardless of whether or not they still work, the matching avocado green stove, fridge, and counter tops are ugly…and they are ugly 24/7/365.  If you want to move this house…replace this ferocious eyesore.  Better yet…HIRE A HOME STAGER!

Yeah, selling a house is hard.  Selling a house in the market is harder.  Selling one of THESE houses with a seller that sins like this…nearly impossible.  Sellers, if you are reading this…listen to your agents.  Agents, if you are reading this…make sure your sellers understand that buyers – like me – will look at these like neither of you know what you are doing and act accordingly.  Probably by running away quick.

 

 

 

If you would like more information about Real Estate Client Referrals and how we can send you more clients to work with, please contact Clint Miller at 800-977-7058.  Or, follow me on twitter www.twitter.com/TheRealClint.

 

Many of you know that I recently bought a home. 

And, for those of you that don’t know that I recently bought a home…I recently bought a home.  Here’s proof.  

Although we are very happy with our home we did purchase, during this process, I happened to notice that as we viewed house after house, I kept seeing the same things happen over and over.  And….not good things.  Bad things.  Bad things that were blatantly obvious to me.  Bad things that literally turned me off.  Bad things that were keeping this otherwise fine house I was standing in from selling faster.

So, as we went through the homes, I started keeping track of things that I saw that made the average buyer – ME – want to run away screaming.  Here is my “Top 10 Seller Sins”:

1. Addition Addiction – Ok…exactly what were these people thinking when they added this addtion to their home??  It isnt level.  The door frame isnt square.  And, that simulated wood-grain indoor/outdoor burber carpeting is HIDEOUS!!  Wasn’t this were the garage should be anyway??  I guess that explains the severely sun-faded paint job on the Sport Family Truckster in the driveway and the Christmas decorations piled floor-to-ceiling in the closet in the spare bedroom.  I don’t care what anyone says…Bigger is NOT always better.

2. The “Pet-Owner Moaner” – The over-all assumption that since the seller loves their pets more than chocolate, so does everyone else.  Here are a couple of quotes I heard directly from the sellers mouths: “Awwww, my cat must really like you to nestle into your neck like that.”; “I know he looks big, but he is really just a teddy bear.”; “We were able to clean up everything in the house except the cat room.”; “I cant remember if my son put away the ferrets or not, but feel free to look around downstairs.”
a.  Ok…first and foremost, Im allergic to cats.  I don’t mean that cats make me sneeze.  I mean that I quit breathing and require adrenallin shots to keep from dieing.  That thing is lucky I didn’t toss it out the open window that was next to me. 
b. The “teddy bear” they were referring to…Yeah, that was a 158lb Rotweiller with a googlie eye and a broken tooth on the right side.  His chain was tied to a cinder block that he happily drug around and tossed into the air during “playtime”. 
c. The “cat room”???  Oh Lord in heaven!!!
d. If you cant figure out if your son left out a pack of rodents in the dark rooms down the creaky stairs without a safety rail and a working light switch, you can be damn sure Im not going to find out for you.

3. Auditory Unawareness – If you cant hear that your refridgerator is making a clicking noise that can be heard from the front yard, Im fairly sure you cant hear the floorboards creaking, the doors squeaking, or the apparent family of raccoons living in the attic.  You also only hear what you want to hear.  Instead of “Your house is priced too high”, you hear “Your house is of a high value”.  Its not the same.  Pay attention!

4. Color Blind – Holy Lord!!  Who decorated this place??  Its like Andy Worhol threw his color pallet into a Cuisinart and hit ‘liquify’.  The fuscia flower print wallpaper needs to go.  And, I don’t carew what you say, it doesn’t do any justice to that wall with the fake woodgrain panelling it joins up to by the sunshine yellow couch.  Worse yet…the white cabinets, white-washed walls, white countertops, and white tile is just a bit much. 

5. “Take it or leave it” – Yup.  Heard that come right out of a seller’s own mouth.  We were discussing the possiblity of him making a necessary repair to a sliding glass door that lead out to a deck.  Between the glass panes was about half an inch of standing water.  Obviously, the seals on the window were compromised.  When asked if he would spend the money to get the glass replaced and the seales re-done…or just replace the entire door…that was the response I got.  Guess what…I left it.

6. Price-itis – The fear that your home wont sell for the price you are asking for it.  I put in an offer on a home that was only $5,000 under what was being asked.  The counter came back with a reduction of $1,000, but a clause to pay $4,000 in closing costs.  Now, I may be bad at math…but, isnt that the same damn thing???? 

7. Fried Food Funk – You know what Im talking about here.  If you can smell it, you won’t sell it.  Bottom line here is that fried food smells, kitty litter, a back yard filled with dog crap, a nursery reaking of dirty diapers, etc…all add up to one thing – a very short showing.  (Well, it also leads to gagging, shortness of breath, tears streaming down your face, and everyone skrunching up their nose and making that internationally known face that says, “Do you SMELL that???”)

8. Photog Fog – Everyone should take pride in their family photographs.  I do.  But, Im not trying to sell my house!  I went into one home where, I kid you not, the entire living walls…every square inch…was covered in frame pics of family.  There must have been 100 pictures in that room.  Frames mounted together like a patchwork quilt of memories and bad matting jobs.  Love the sentiment…love the family pride.  But, I was COMPLETELY distracted from seeing the actual house. 

9. “I collect them” – No kidding, really???  Nothing would have made me realize you collect dolls were it not for the fact that Im now suddenly very aware of the fact that 226 eyes are now following me through your house like Chucky with an ax to grind.  Yeah, I couldn’t tell that you collect Vegas casino ash trays since they are on every flat surface in your entire house including 4 separate 6-ft tall bookshelves, your coffee table, the top of your TV, the end-tables,  and the extra two shelves that you put up encircling the entire living room.  But, worse than that, you have them on your toilet tank, your dresser…and in an amazing twist, you have drilled holes in them and replaced half of the doorknobs in your house with them.  In case your agent hasn’t told you this….PACK THIS CRAP UP!

10. Livin in the past – I don’t care what you think, the pea soup green shag carpeting is not coming back in style.  And, regardless of how many memories are associated with it, the nine-foot long, hunter orange, faux-leather couch on the wooden legs with the sleigh-style arms on the each end is FREAKING UGLY!!  Regardless of whether or not they still work, the matching avocado green stove, fridge, and counter tops are ugly…and they are ugly 24/7/365.  If you want to move this house…replace this ferocious eyesore.  Better yet…HIRE A HOME STAGER!

Yeah, selling a house is hard.  Selling a house in the market is harder.  Selling one of THESE houses with a seller that sins like this…nearly impossible.  Sellers, if you are reading this…listen to your agents.  Agents, if you are reading this…make sure your sellers understand that buyers – like me – will look at these like neither of you know what you are doing and act accordingly.  Probably by running away quick.

 

 

 

If you would like more information about Real Estate Client Referrals and how we can send you more clients to work with, please contact Clint Miller at 800-977-7058.  Or, follow me on twitter www.twitter.com/TheRealClint.

READ ON INMAN THIS MORNING, an article by Matt Carter about the recent complaints by real estate agents about appraisals needs some clarity from the perspective of a real estate industry representative, me.

Freddie Mac issues appraisal bulletin   Appraisers must have local expertise, choose 'appropriate' comps.

Requiring local expertise???? 

Choose 'appropriate' comps????

With few closed transactions in an area, an out of the area appraiser may select a comp for a home 2 miles away that would have a much higher or lower market value. 

.                    

The difference in market value for a subject home and a comp just 1 mile away could be as much as 1-5% depending on the location, the community, the floor plan, the condition, the amenities, additions, etc.   Out of the area appraisers are not going to understand local community features, schools, attractions.  Only experienced agents can help.                     

Does Freddie Mac mean that an appraisal company should only accept an appraisal order if they have a local appraiser? 

WHAT A CONCEPT!

Well, of course, an appraiser should have local expertise.  What is local???  When a buyer insists on using a mortgage company from 2,000 miles away simply because they have "quoted" the lowest interest rate, getting a report of appraised value from an appraisal company 100 miles away isn't anything new.  

WARNING!  THE LOW INTEREST RATE QUOTE may bring unintended consequences.  Over the past 10 years, since the Internet has permitted home buyers to shop for interest rates on line, we've gotten appraisals by appraisal companies selected by that out of the area mortgage company with absolutely knowledge of the town, community, house type, general market conditions, etc. of the subject home.  This problem didn't begin with HVCC.  HVCC simply exacerbated a problem that began with Internet advertising and the sense of "empowerment" by home buyers. 

AGENTS NOT DOING THEIR JOB?   How often when the question is asked, "should the listing agent meet the appraiser?", the answer from many ActiveRain members is NO.   We read about many agent who find one excuse after another for not meeting the appraiser and defending their list price?  They claim "liability".  That liability is never explained. 

WHAT IS THE LIABILITY?  Meeting an appraiser who may be from 50-100 miles away, presenting the comps used to price the property, explaining the features that distinguish that property from others in the area would seem to be a useful thing for the appraiser and part of a listing agents responsibliity to the home owner who has hired that listing agent.  Too often the listing agent acts as though they have done their job when they have a listing, or a contract of sale.  Our goal is to get to settlement and transfer title.  Only then is our job as listing or selling agents fullfilled. 

• Listing agent meets with seller.
• Listing agent recommends price based on comparitive market value of similar properties.
• Listing agent enters into contract to list property for sale.
• Listing agent represents seller in negotiating a Contract of Sale.

What comes with that Contract of Sale is usually buyer financing including an appraisal.  How can a listing agent divorce themselves from the appraisal process when they have been involved in the transaction since the beginning, including recommending a list price and negotiating the contract price? 

OUT OF AREA APPRAISERS ARE NOT NEW!

SHORT SALES ARE NOT NEW!

FORECLOSURE SALES ARE NOW NEW!

LOW APPRAISALS ARE NOT NEW!

What is new is that, now that the government is involved in our business to an extent never seen before, real estate agents need to understand the basics of their job and better protect their buyers and sellers. 

DON'T BLAME THE GOVERNMENT FOR LOW APPRAISALS!

Let's take our business back and do our jobs.  Learn the basics of property valuation.  We are not appraisers but we must understand how to estimate market value.  We must learn how to compare recent sales to the subject property.  We must understand market trends.  Seek local course offerings by your local associations about appraisal basics for agents.  These courses will give you a foundation on which to build solid price valuations.  Get copies of your buyers' appraisals and study them.  If you don't understand something about the appraisal, talk to your broker.  Learn your job. 

PROVIDE YOUR SELLER WITH ACCURATE PRICE OPINIONS.  Don't recommend a high price to get the listing.  If you're representing a bank, let them know the market trends in the area in addition to present day comps. 

IF YOU'RE IN AN AREA WHERE THE APPRAISERS ADMIT THEMSELVES TO THE PROPERTIES, LEAVE A PACKAGE ON THE KITCHEN COUNTER "FOR APPRAISER"  including the comps you used to price the property with distinguishing features highlighted. 

MEET THAT APPRAISER AND HELP HIM/HER UNDERSTAND HOW YOU PRICED THE PROPERTY.

The result will be fewer appraisal problems and smoother transactions for the buyes and sellers.

~~~~~~~~~~~~~~~~~~~~~~`

FROM THE FREDDIE MAC GUIDELINES

44.5: Information supplied to the appraiser (10/06/06)

(a)

Information for appraisals The Seller warrants that the Mortgage originator provided the following information on the subject property, as applicable, to the appraiser in conjunction with all appraisal requests: 1. The complete legal description (see Section 40.1 for legal description requirements) 2. Current condominium association budgets 3. The complete sales contract (A sales contract on a new home should state the base price of the house and itemize each option.) 4. All financing terms, financing and sales concessions granted by anyone associated with transaction, and any gifts, buydowns and down payment assistance provided by anyone on behalf of the Borrowers, whether for purchase or refinance transactions 5. Income and expense statements, property leases and a list of nonrealty items that are included in the transaction, and 6. Any other information that the Seller knows that may affect the value or marketability of the property. This information includes an affiliation between the property seller and purchaser, proposed changes to the use of the property, and the presence of any Contaminated Site or Hazardous Substance affecting the property or the neighborhood in which the property is located.

I don't see anything in this section that precludes the seller, through their agent, providing comps to an appraiser.

 

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988. 

 

Yesterday I received an email from someone who is dying to blog but the problem is they feel they are not creative enough...

Do not know what to write about...nor have the confidence to write a post.

So they asked me what should I blog about on Activerain? 

So I thought for those that are new...or even seasoned..here are a few topics that will help you to get read and fed..

And at the end hopefully a commission check and building strong business relationships!

 

Think local..your state..your city...your subdivisions

• The first time home buyer tax credit and where to get the information
• The dos and don't of buying or selling a short sales and foreclosures
  
• The steps in finding a home
• Mortgage and tax information
• Market Reports
• Steps in selling a home
• Investments, Investors and Investing
  
• Hiring the right REALTOR
• Questions consumers ask
  
• Your specialties
• Your farm area
• Inspections, appraisals and the mortgage process
• Home staging, clearing the clutter and increasing your chances of selling
  
• Local Businesses and experiences
• Interview local people, city officials, veterans, teachers and business owners
  
• Happenings meaning special events..most cities have monthly events such as baseball games, parades, fairs etc.
• Nite life, schools, family activities, clubs, organizations and houses of worship
  
• Historical sites...every city has them
• Important phone numbers and information such as the post offices, electric, water, cable, police..etc..etc.
• Important tax information and changes
• Real Estate Law changes
• Home Owners Associations, Condo Associations and city and county home owner's regulations
  
• Recycling, charities, schools, parks, vacation spots, beaches and lakes and rivers, local news, your affiliates, hobbies, things you do
• How to tips on blogging, social media, building business relationships

 

When I think of blogging I think of conversations..conversations that you would have face to face or over the phone...information that is pertinent for someone to make a real estate move in your area...pertinent to your business and pertinent to your goals.

And if you can't find the right words... post Photo's and video's and if you are still stumped..reblog baby and add your own personality!

I know that not everyone has the gift of gab..but I can assure you...by blogging..it will come to you...and become quite natural..so pick a topic.

Have a plan...and write...just write.

About The Author: Midori Miller is a Real Estate Trainer and writes and trains Real Estate Training and assists sellers in short sale situations. Midori is a Licensed Florida Real Estate Broker , License # BK645709 and a member of the Daytona Area Association of REALTORS. Contact midorimiller@yahoo.com or (386)453-3236.

 

For some they may snub the idea of reblogging...the thought of someone else's written words on your blog, NO WAY!  If more people really understood the true value of reblogging...some may consider using it a bit more.

No, reblogging is not for the lazy but for the smart and efficient...you see regardless of how professional we are..how much we think we know...someone else may very well present an idea..thought and written words in a better way...because maybe its their level of expertise.

Let me share with you...the non believer the true value of reblogging...tips for Activerain members..

Think about this...

You are a real estate agent...well versed in real estate but not really well versed in mortgages or home staging...so you subscribe to someone who is the home stager extraordinaire...

Why not provide valuable information to your readers...hopefully potential customers.

You are trying to raise money or awareness on a charity, event or happenings in your area..why not encourage people to reblog your valuable message, just another way to get your message out. 

You know the old saying, you tell two friends and so on and so on.

You and your service providers are all on the network...why not help one another along by reblogging their message..you scratch my back and I'll scratch yours.

You have blog fog..it happens...you stare at the screen and your own words don't seem to surface. 

Find a great post and add your own flava...and there is your post...for the day!

Last year I posted about breast cancer awareness...

That post was reblogged 18 times...imagine the eyes that got to view that post..helping a great cause...the SEO power...again its important to add your own text...your words and theirs..

The author gets link love and your reward....great content and who knows, someone may very well decide to do business with you based on the information you have provided for them.  

Don't be shy...don't worry what others think..its your business and you have to find ways to get many messages out...reblog baby...I'm a believer....feel free to reblog mine anytime! :)

About The Author: Midori Miller is a Real Estate Trainer and writes and trains Real Estate Training and assists sellers in short sale situations. Midori is a Licensed Florida Real Estate Broker , License # BK645709 and a member of the Daytona Area Association of REALTORS. Midori is also an Activerain Ambassador...need assistance contact midorimiller@yahoo.com or (386)453-3236 today!

 Many of us have seen an increase in traffic from first time home buyers looking to cash in on the $8,000 tax credit. As time draws closer and closer for the credit to slip back into the abyss, we now have rumors of more credits, extending the current credit, and we have first time home buyers in a race to pick up their new home. This is of course an effort not to miss out on the tax credit, which at this time, will expire December 1st of this year.

 So, what about the buyers who are in that race to make it to the finish line with their new found home and their credit firmly in hand? If they are currently writing a contract on a build job, then they are dangerously close to running past the deadline, after all, it does take time to build a home. Some are still sitting on the fence and will likely take that leap of faith at the last minute hoping that all will work out well. However, we have all seen the significant increase in delays when it comes to closings.

 

 How many buyers are going to miss out on their opportunity to claim their credit because their closing was delayed? How many are going to attempt to build a new home and due to weather, miss out by a couple of days? And who are the buyers going to blame? The Government for not extending the time line. The builders for not building fast enough? Their Realtor because things didn't run as smoothly as they should have? The mortgage broker because the closing was delayed?

 I know of at least one builder in town who for the past two months has had all first time home buyers sign a form declaring that they are not responsible for delays in closing. This was done specifically because of the tax credit deadline and the amount of angry buyers that they see in the future due to delays in closings. The fact of the matter is that one way or another, is going to be an interesting time and I'm willing to bet that in this sue happy nation, it will be a really interesting time. That's why I have my own form discussing the fact that I am not responsible for delays in closing due to others.

 So, if you're a first time home buyer out there and you want to ensure you can claim your tax credit, I would advise that you get on the ball. The clock is ticking and if you wait until it's too late, you'll have no one to blame but yourself. If you are a member of the real estate industry and you have people who are going to cut it close, I would advise you to come up with a plan or a document to protect yourself from the possible future backlash. Maybe I'm just a worry wort, but no one ever got in trouble for being over prepared.

www.jlboney.com

A few weeks back, I received a Facebook notification regarding a new message on my wall.  Now does that sound Social networky or what?  lol~ Anyway, it was an old friend and past client who was asking me for a referral in an area close by.  Of couse I looked up Linda on ActiveRain, and referred her over to Tom.  Yesterday, I get a Facebook notification that there's a new comment from Tom on my wall again.

Naturally I responded to Tom immediately, and then thanked Linda.  :-))

Funny - Just two days ago, I was talking about referrals with Nyssa on Activerain (we were actually on Twitter..haha)  discussing what we felt is the true definition and meaning of "referral?"  I think this was a perfect example of a Social networking referral, and I think we'll see many more of them done like this in the future.  Facebook and ActiveRain generate the contact, and the relationships and "connections" generate the referral.  ActiveRain and Facebook are excellent conduits, but it's always has been, and always will be about people.

Here's two great social networks, totally different from each other, yet connecting us and providing opportunities that many of us still have yet to discover.  How will you use ActiveRain and other Social Networks like Facebook, Twitter, and LinkedIn etc. to do business and build referrals in the future?  Or will you end up like me, and just be using them already without even realizing it?  :-O

The ActiveRain RainMaker - It's More Than Just A Membership!

 

The Real Estate Industry has had a pretty rough ride these past few years and many Industry Professionals that remain are desperately trying to find new and creative ways to survive.  Many are turning to ActiveRain because they have heard and seen that this is where they can learn how to use the Internet and Blogging to their advantage, and turn around their business.

ActiveRain is more than just a Real Estate Industry Social Networking community.  In the past 2 or so years, the network has grown from 20,000 members to well over 150,000 to date.  On average, 200 new Industry Professionals join each day.  ActiveRain get more than 2,000,000 visitors each month, with about 80% being consumers.  The community accounts for nearly 12,000 new blog posts each month, and currently hosts over 1.5 million Blog articles provided by members.  The average rainmaker post gets over 500 views per month.

 

What do ActiveRain members get as Rainmakers?

• A Referral Network with Access to over 150,000 Real Estate Industry Professionals

• Exposure and Access to over 2,000,000 visitors to ActiveRain monthly

• Create Hit Router and Home Search Campaigns using your IDX

• A Personalized and Customizable Outside Blog including Domain Name

• 30+ Themes and Templates to select from to enhance your Blog

• The ability to add Multi-Authors and Contributors to your Blog

• Custom Created ActiveRain Widgets and Tools for ActiveBlogs

• Access to Localism for posting Hyper-Local Content - The NeighborPedia for Consumers

• Customer Service and Technical Support - Coaching, Consulting, and Training available
  

• ActiveRain SEO and a Hyper-local Architecture Optimized (raindexed) for Search Engines
  

 

What are the "Benefits" of a RainMaker Membership?

Many in our community have posted articles about their success and ROI (return on investment) from their RainMaker Blogs.  We have seen countless testimonials from ActiveRain members who have experienced first hand the results and business that gets generated solely from their ActiveRain Blogs.  Members share their "Real Life" stories of how effective Blogging on AR can grow your referral business, consumer business, and relationships within the network and within your local community and neighborhoods.

Here's what some have to say:

"When I first started on AR, I got many friendly e-mails and comments.  I think this gives AR a personal touch.  AR does work. I signed up for Rainmaker last month and will be writing a contract for a buyer who contacted me through one of my posts."  Vanna Siackhasone

"I have gotten several clients and some agent referrals directly from AR and continue to learn from the posts of others, hoping that I can share whatever I can too."  Susan Neal

"I have learned so very much from these wonderful people on AR! Best real estate site on the Internet, and I am happy to be a part of AR!" Ginger Moore

"In May 2007, I started walking in the Active Rain (ok, maybe crawling) and by the end of the year we had made tens of thousands of Washingtons directly from blogging leads."  Erion Shehaj

"AR has helped my business tremendously to the tune of 11 closings to date."  David Serle

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Having the seller pay some or all of your closing costs is common. Some buyers and their real estate agents have a hard time structuring these type of transactions. Below are FAQ's to help you understand the structuring needed for a purchase with seller concessions.

Clarifying Terms

When talking about this topic there will be many phrases thrown around that basically mean the same thing; seller concessions, seller paid closing costs, seller assistance, seller contributions, and more. For our purposes we will use the term seller concessions.

How much can I ask for in seller concessions?

Typically on conventional loans the most a buyer receives in seller concessions is 3% (On a $100,000 purchase, $3,000). Making a larger down payment can raise the amount of concessions allowed from 3% to 6% or even 9%. However you rarely see these high concession amounts because if a buyer is putting, for instance, 25% down on a home, they don't have the seller pay concessions for them. Not only that, but if you need 9% in concessions, something is usually wrong with your financing.

On FHA loans, you can receive up to 6% in concessions. (On $100,000 purchase price, $6,000) Typically the lower the purchase price the higher percentage of seller concessions you will need. It is not typical to have a $300,000 purchase price and need $18,000 in seller concessions. It is much more typical to see, for instance, a $60,000 purchase price and have $3,600 in concessions.

On USDA loans, there is no limit to the allowable seller concessions, other then it has to make sense. A buyer would not typically need a percentage of seller contributions over about 4-5%. There are some examples below of reasons why a high percentage of concessions would be needed.

How do I calculate the seller concessions?

Simply take the purchase price, and multiply it by the percent allowed for the type of loan. For example, a $100,000 purchase price with 3% concessions is $3,000, and 6% concessions is $6,000, etc. On a calculator, you would multiply 100,000 x .03 or .06 respectively.

What can seller concessions cover?

Seller concessions can cover your closing costs which may include mortgage related fees, title company fees, the set-up of an escrow account, your home owner's insurance costs, state taxes or stamps, and more. Many, but not all, home owner's insurance companies will allow you to pay the policy premium at settlement. If that is important to you find out upfront. Seller concessions CAN NOT be used for a down payment.

What is NOT Seller Concessions?

Grants are not seller concessions. Down-payment assistance programs are not seller concessions either.

For first time home buyers, a lender and real estate agent that work together closely can structure an offer to purchase a home where you can utilize both a grant to pay for all of your required downpayment, and seller concessions to cover all of your closing costs. It is not rocket science. You simply have to work with people that know what they are doing.

It is important for your lender and your real estate agent to convey approval terms BEFORE making an offer on a home. Any real estate agent worth your time would have a buyer pre-approved before submitting offers on a home. This being said, it is important that your real estate agent not only knows how much you can afford, but also the terms and conditions of your approval. Some pre-approvals are contingent on seller concessions and/or grants. This needs to be communicated to all parties up-front.

Am I paying more for a home if I use seller concessions?

Some people may look at their purchase of a home in this way; (Using round figures) I can pay $190,000 for a home and pay my own settlement costs of $10,000 I can pay $200,000 for a home and have the seller pay $10,000 of my settlement costs. Viewed this way you are actually financing the costs. You pay interest on $10,000 more, BUT you get to keep $10,000 in your pocket, which more importantly you can keep for a safety net (and earn interest from yourself).

SIDE NOTE: This aspect can not be over-emphasized. If your lender thinks it is "OK" to put you in a home where you have literally a few hundreds dollars in the bank after settlement, you both are setting up for a VERY RISKY situation and one which could go into default very quickly. It is unwise to purchase a home and immediately be poor. It would do all home buyers well to consider this before purchasing a home. Hopefully you will have a lender or real estate agent who would care more about you in this sense then than just getting another paycheck, but don't assume that.

Ways to utilize seller concessions for your benefit

• Have some or all of your closing costs paid by the seller.
• As a first time home buyer utilize both a grant and seller concessions to cover your closing costs and down payment requirements.
• Create a financially safe environment by keeping more money in your pocket after settlement. This aspect is overlooked too often yet is very important to you as a home owner.
• Have the seller pay points for you. This will make your monthly mortgage payment lower by giving you a lower interest rate.  In some cases this can be the deciding factor on if you qualify to buy a home. This will also lower your debt-to-income ratio, which is one of the major factors a lender looks at when approving a loan.
• Avoid private mortgage insurance (PMI). If you are a buyer that has the assets available to make a 20% down payment, but not enough assets to pay closing costs, then have the seller pay your closing costs. This will bring you to the 80% loan-to-value level and allow you to eliminate PMI. (NOTE: This is all negotiated when you make your offer on a home and agree to terms).

Conclusion

Seller concessions are an important part of home financing. Used correctly, seller concessions can save a buyer money, allow more financing options, and create a financially safe environment. Consider these important aspects prior to making an offer on a home and you will be much better off, both at settlement and in the long term.

If you have any questions about seller concessions or any other mortgage/real estate topic(s), feel free to contact Steve Kappre directly.

 

---

Steve Kappre is a Mortgage Planner with Treasury Mortgage. Steve specializes in;

• All areas concerning First-Time Home Buyer Mortgages, grants, down payment assistance, police and fire loans, rehab loans, and more.

• Reverse Mortgages

• Equity Management strategies for high-end homes and high net worth individuals.

Contact Steve Kappre directly at 856-419-3561 or at www.stevekappre.com

ACTIVERAIN HAS MUCHO MOJO!

Inspired by a post by Robert Swetz about ActiveRain losing gas, I thought a comparison of other real estate related web sites was in order.

• WHY ARE YOU AN ACTIVERAIN MEMBER?  Your motivation for membership may influence your opinion about the present day status of ActiveRain on the Interent. 
• ACTIVE MEMBER - You probably realize the value of regular posting to ActiveRain.
• ACTIVE MEMBER BUT ONLY POST TO MEMBERS ONLY - Perhaps blogging is a vehicle for personal expression.
• ACTIVE MEMBER BUT POST PRIMARILY TO LOCALISM - Use ActiveRain for business generation and don't really care about the personal expression.
• MEMBER BUT NOT ACTIVE - You may not realize the benefit of Active Membership.  Invited by a member but not really interested in blogging.  

When I read a post about ActiveRain losing gas, or as often expressed, losing Google juice, I always want to ask, compared to what?  I'm not sure that ActiveRain is

• losing gas,
• losing rank, or
• losing status as a premier real estate realted blog.

COMPARED TO OTHER REAL ESTATE WEB SITES, two measurements that I use to determine Interent synerby are pages indexed by Google and Google backlinks.   Pages indexed by Google represents opportunities for a Google return in a consumer search.  Number of backlinks represents the popularity of a site, used by Google for page rank.   Compare the following:

 

Pages Indexed
ActiveRain.com	951,000
Realtor.com	2,950,000
Inman.com	36,000
Housevalues.com	309
Zillow.com	2,380,000
Homagain	2,140,000
Realtor.org	37,300
Trulia.com	4,300,000
Backlinks
ActiveRain.com	1,670
Realtor.com	4,130
Inman.com	1,930
Housevalues.com	59
Zillow.com	3,860
Homegain.com	1,060
Realtor.org	2,900
Trulia.com	3,190

With a membership of 151,552, as of this a.m., ActiveRain has 951,000 pages indexed.  If you are posting regularly to ActiveRain PUPLIC pages, Google is going to crawl your post. 

EXAMPLE:  My post SELLING A HOME IS A VOLUNTARY DECISION - OR, IT TAKES TWO TO TANGO TO THE CLOSING TABLE was posted on July 2, 2009 @ 6:58 a.m.  It was indexed by Google on July 2, 2009 @ 12:51 GMT.  This is the result I see regularly.  My Localism posts, all PUBLIC are indexed within minutes of publication.

THAT IS GOOGLE JUICE!  I do not believe that ActiveRain is losing gas. 

*This number does not represent the total Google backlinks, only major ones are reported.