Posted on 18. January 2012 03:46 by qmiskini

 

The New Year has brought with it a number of new negotiation points to work through for Realty Teams representing Buyers making offers on REO (foreclosed) properties.  The most myopic negotiation point to date came up the other day in a multiple offer and highest and best negotiation situation one of our Team’s Buyer Specialists is negotiating.

The property is a foreclosure in a pleasant sub division in Kennesaw, GA.  The Investor (the actual owner of the property’s note that is serviced by a Lender) invested the money to clean up and update the property.  It is a great move-in condition home and perfect for the young first-time buyer hoping to close the deal on their first new home.  A realistic Comparative Market Analysis was completed prior to presenting an offer to the REO listing agent for presentation to the asset manager directing the sale of the property on behalf of the Investor.  The asset manager had smartly instructed the REO Agent to list the property at around 10% below fair market value.  So, here is a great property at a very good price.  Not an unfair tactic on the part of the asset manager, but one our Buyer Specialist was aware of when the offer was written.  A multiple offer situation and a highest and best competition were expected, and the Buyers were told that the property would likely sell for around 10% above initial list price.  Within days there were multiple offers. 

As with all offers our Buyer Specialists present, an Appraisal Contingency exhibit was included.  This is an important protection for the Buyer.  It states that an appraisal will be completed within a specific number of days following binding agreement, and that if the property appraises for less than the initially agreed selling price, the Buyer has the right to ask the Seller to lower the sale price to the appraisal price.  Without this exhibit, the Buyer must pay the previously agreed selling price, even if their lender will only finance a loan for the lower appraisal price.  The Buyer would have to come up with the difference in order to complete the sale.  The use of the Appraisal Contingency Exhibit is a commonly used, fair and necessary protection for the Buyer.

In this offer, however, the Investor steadfastly refused to accept the Appraisal Contingency stating: “The seller rejected your client's last counter.  Seller will not take an appraisal contingency.  Seller indicated he will not agree to appraisal/sale price adjustment. 

Seller staying firm in his belief if the property is on a multiple offer situation, the buyer is willing to pay the difference.

Please note property is available to any potential buyer.  We are getting too many inquiries at the present time, to include buyers that previously submitted an offer. “

 With the seller (Investor) refusing to accept an Appraisal Contingency, the Buyer is being placed in double jeopardy.  First, if the property does appraise for less than the selling price, the Buyer will have to still pay the difference to close the sale.  They will have to pay more than the property is worth and start out under water. But if they refuse to pay the difference and back out of the sale, under the terms of the agreement they will be in default and lose their earnest money deposit.

Perhaps there are some Buyer Agents that will let their Buyer take that risk.  Not us though.   

Buyers… purchasing a home is an emotional experience; but it is also an important, and often, your biggest investment.  In real estate you make your money when you purchase your home, not when you sell it.  Buying your home for the right price at the start helps significantly in managing the home’s equity value when you sell it.

As for this Investor and asset manager:  Are they coy, wise, greedy, myopic?  How tough is too tough before Buyers and experienced Buyer Specialists simply must move on and reject an otherwise great property?

Don’t forget…selling or buying a home is a process and a journey, not an event; you will want to subscribe to our free video e-mail series for home sellers and buyers. For access to the complete series of free video and informational emails that can provide you with many of the important strategies and information you will need to make the best home selling or buying decisions you can CLICK HERE ==èSPECIAL E-MAIL SERIES REPORTS and ask for the free no obligation series of email reports to be sent to you regularly over the next few weeks.  Just put FREE VIDEO EMAIL SERIES in the subject line and let us know if want the home seller or home buyer series. 

If you just want to see what other homes in your area are selling for by searching the MLS CLICK HERE =èSEARCH THE MLS FREE

Or contact us directly for free, no obligation information at info@TMTRealtyGroup.net

 


Posted on 9. September 2011 02:31 by qmiskini

 

Whether you are buying or selling a home, look for a Realtor with the reputation of going the extra mile for their Clients.  Going the extra mile can mean many things.  Often they are small details that crop up before, during and after the end of a purchase or sale.  Did I say after a sale closes?  Yes, even after a sale closes.

Here’s a simple example of how duty and service should extend beyond the closing of a transaction.  It may seem like a small issue, but to the Buyer involved it was really important.

For one young first-time home buyer couple, finding a home they could both afford and fall in love with in Alpharetta Georgia, and then the process of buying the home was a continual, seemingly never ending list of “oh my gosh” details.  But this is true in nearly every purchase or sale of a home.  As Realtors we work daily through the list of items necessary to be taken care of during the process of buying or selling a home.  Most of the steps repeat over and again from transaction to transaction.  For Buyers or Sellers who may only purchase or sell a home once every seven to ten years, or only once in their lifetime, everything you have to do can, at times, seem monumental.  Because most of the tasks you must take care of, most of the decisions you have to make, are being done for the first time, we must be your trusted advisor, educator and guide.

So now the transaction is complete. You have made it through the Closing. The Seller has presented the key, garage door openers and their best wishes to the Buyer and its move-in day.  This young couple who was so nervous about every detail is moving in and is really excited about spending their first night together in their own home!  Move-in day is on a Saturday. For most of us who work with Buyers, Saturday is a busy day of showing homes to our Clients.  Ring, ring… the Realtor on our Team who successfully guided this first-time home buyer couple through their first home-buying experience is calling and there’s the sound of panic in their voices.  “None of our toilets work! What do we do?”

At the walk-through the day before the close of their sale, everything seemed to be in good order.  Sink faucets flowed, toilets flushed, lights switched on and off.  But now its 4 PM on a Saturday, they are exhausted and ready to crash, and “all the toilets are broken!” 

“Okay,” she replied. “I’m way on the other side of town in Kennesaw, and I’m certainly not a plumber, but I’ll call the Seller directly to see if they did anything before they moved out that might have caused the toilets to stop working. “  And so she tracked down the Seller who explained that he had cut off the water to each of the commodes just to be sure there wouldn’t be any leaks during the time between the walk-through and the closing. “Hi guys…problem solved.  Just turn the water valve at the base of each commode a few turns and the water will start to flow.” 

Several days later, after settling into their new home they called that Realtor.  They wanted to thank her for “going the extra mile” for them.  “We tell everyone about how you helped us find our dream home and were there for us even when it was no longer your responsibility. We love our new home! Thank you!” 

Choose a Realtor who will Go the Extra Mile!

For access to a complete series of free video and informational emails that can provide you with many of the important strategies and information you will need to make the best home buying or selling decisions you can CLICK HERE ==èSPECIAL E-MAIL SERIES REPORTS and ask for the free no obligation series of email reports to be sent to you regularly over the next few weeks.  Just put FREE VIDEO EMAIL SERIES in the subject line and let us know if want the home buyer or home seller series. 

If you just want to start out by searching the MLS to see what types of homes are available in your projected price range and area of preference CLICK HERE =èSEARCH THE MLS FREE