You’ll Never Believe the Day I Had!

I am always on the road for my work. I don’t expect to run into trouble when I go out to check on a property or to set up an open house. Yes, I am a realtor in the flesh. We know the local areas and they are good neighborhoods for the most part. As a result, I don’t carry a gun or knife. I don’t know the least bit about self defense. I cannot even pronounce the names of the various martial arts. I have never met anyone who has a “belt” in one of them. I would be afraid to try a kick, punch, or jab lest it land in the wrong place.

You can imagine my surprise when I arrived at an empty home one night and found a few thieves attempting to steal the copper pipes out of the walls. What audacity! It happens all the time. You might have heard about this and know that copper fetches a good price as a scrap metal. As I stumbled upon the vandals, I had flashes go through my mind about what I could do to chase them off before they did irreparable damage. Fortunately, quick thinking caused me to grab a handy cast-iron pot hanging from a decorative rack within a few inches of where I was standing. I swung the menacing item toward one of the robbers to scare him off. I assumed the other would follow suit. They both ran for the back alley and I wasn’t about to go after them. I did call 911 hoping they would find them lurking close by.

The thieves probably assumed that I had a gun and didn’t want a confrontation over some old pipe. I am now thinking of carrying some other form of non-legal self defense. There won’t always be a heavy pot sitting around anywhere I go. I would look silly brandishing a shovel or a rake, but it could work. I prefer pepper spray, a body alarm, or shouting and yelling to draw attention from helpful neighbors. I never thought of real estate as a risky business, but it borders on perilous. I would suggest that brokers go out at night in pairs. There is safety in numbers, says the old adage.

Never assume you are safe when on the job. The thieves may come after you arrive like a home invasion. They don’t expect to find you in an empty residence and they may be unprepared themselves. A quick douse of pepper spray will make them run, moaning in pain. A burning sensation around the eyes, nose, and mouth will immobilize the strongest of men. But when the spray is not available for some reason, don’t overlook everyday tools as a potential self defense weapon.

Meanwhile, we are lucky to enjoy a profitable career that involves dealing with people and presenting beautiful sites. If you have a big dog, he will make a great companion providing safety and security.

Supporting a Good Cause

As a realtor and businessman, I have clients who invite me out socially from time to time. Sometimes they include me in special charity events for a cause they support as a donor or board member. When you do business with someone, there is an unspoken agreement that if you earn any profit from a client, you will be willing to donate to their cause. They expect this from all the vendors they work with and you see tables of corporate people all around the room. This is a primary way that charities do fundraising. They depend on the business community. I understand and therefore do attend a variety of local events. It is a form of public relations and publicity I suppose, but I like to think that I also have a kind heart. We all need to contribute a percentage of our income to worthy causes or at least volunteer if we prefer that kind of contribution. So, I am visible at all kinds of interesting events which gets me much wanted repeat business. You support a client and they in turn will support you. You can allow part of your operating budget to charity each year.

Anything can happen at one of these charity events. You meet new people, run into old friends, win the door prize, and your wife gets to dress up and wear her favorite jewelry. Speaking of the wife, I must relate a very odd story. My wife wanted to look especially nice for a special banquet and decided to apply more makeup than usual. She even went to far as to curl her eyelashes before coating on some mascara. She looked angelic and beautiful – she had Eyelashes to Die For. Unfortunately, this was not all that happened to her eyelashes. Such delicate things! Each guest had a candle in front of them and at one point, hers was flickering which annoyed her and she tried to blow it out. The wick was low in the container and she bent over, apparently too low. One eyelash was singed right off. She was aghast. I suppose they grow back and I have heard this happen to eyebrows, too. It was not a pretty sight. She didn’t want to stay for the rest of the evening so I suggested she put on her heavy reading glasses so it would not be very noticeable. Not wanting to miss out on the festive events, she agreed. Such a good sport my wife!

The story doesn’t end badly since I treated my wife to a session at a famous salon where they could apply false eyelashes. She was thrilled to be restored to normal. She looked as good as new. I didn’t have to talk her into going to another event since she professed to me that she had learned her lesson the hard way. Any candles will remain untouched on the table. She could still dress up, apply nighttime makeup, and have a good time.

Always Be Prepared

I could have been a Boy Scout as my personal motto is “be prepared.” And I want to add that you can’t be too prepared either. How many of us have run out of gas because we forgot to fill the tank that morning? How many of us feel like we are dying of thirst on a hot day because we forgot that extra bottle of water in our backpack? How many run low on funds when they need cash for a series of purchases and how many forget to answer important emails that may change our day? There are just so many instances of forgetfulness and lack of follow through because of inattention. The most important area of concern for me is adhering to my daily calendar. Of course, that means keeping it up to date. Then there is a whole battery of categories like birthdays and anniversaries that get forgotten. If you don’t have an assistant at your beck and call, you must depend on your own memory to keep you afloat in the midst of complexity and sometimes chaos.

Tops on my list of things to be mindful of is my trusty flashlight that I depend on when walking around unfamiliar houses at night. Very often the power has been turned off by the previous owner and who wants to walk in a strange realm in the dark. I also have a small light on my keychain that helps me open front doors that have no illumination., also because there is no power. Normally you have fixtures on either side of the door. I was so grateful I had my large tactical flashlight that I bought after reading this review – http://www.flashlightpro.net/best-tactical-led-flashlights/. I was exploring the layout of a house new to me as a realtor. I heard scurrying sounds as I progressed from bedroom to bedroom and I thought that they came from the kitchen. I slowly and hesitatingly made my way to this core room of the house and shone the light all along the floor. Sure enough as I had expected there was a little furry critter.

I was grateful that it was not a rat, but a lowly and harmless mouse. I didn’t like the idea that there were vermin about. Clearly the house had not had exterminators present in a very long time. Now I could see there was a great need and I made a note to tell the owner that this needed his immediate attention. I continued my flashlight search in every nook and cranny so that I could add repair items to my list. I was worried about cleanliness given the presence of the mouse who was no doubt attracted by some kind of food that had been ignored and thus left behind. There is nothing worse when showing a home than to hear from the client that the place smells and seems unclean. Thanks to my flashlight, I now know the truth about this property and its lack of attention.

Bouncing Back After an Offer is Turned Down

When you’ve found the home that is just what you are looking for and you make an offer that you feel is fair, rejection can send you reeling. It is common for first offers to be rejected by the seller. They naturally want to get the best possible offers from the most qualified potential buyers so the seller may be holding out. This isn’t the end of the world, although it may seem like it at the time. There are still things that you can do to influence the final outcomes. It is important to have a plan in place to deal with rejection effectively.

Find out why your offer was rejected

It is perfectly acceptable to ask the realtor the reason for the seller rejection of your offer. Once you find out why it was turned down, you may be able to come up with a plan to address the problem. If you lowballed the seller, you may improve your chances with a higher offer. In some cases, the seller may make a counter offer and if this is something that is within your budget and you feel that is reasonable, the problem may be solved.

If there are multiple bidders involved, the seller may have received a higher offer. Work with your agent in these cases to make a reasonable offer that is higher than the other bidders. If the bids exceed what you consider to be reasonable it may be time to pull back. This doesn’t necessarily mean that you’re out of the ball game. For a number of reasons, the sale may not go through and you may be the next highest bid. It’s not advisable to exceed what you or the agent feels is a reasonable offer or one that is beyond your financial means.

Eccentricity in sellers is also a major roadblock. Sometimes there are no sound reasons for the rejection of an offer. There are people who consider selling their homes but when they receive a serious offer, they look for reasons to reject them. It could be that you’ve done nothing wrong and in these cases, you could either wait and see or move on to another prospect.

Dos and Don’t after a rejection

You should always talk to your agent to get the lay of the land about the seller and advice about the next best step to take in the process. It’s possible that the agent is responsible for the rejection. Avoid becoming emotional and taking it personally. This may be the hardest part but this is business and emotional responses won’t do you any good, in fact, they can work against you. Do re-evaluate your strategies and decide if you need to take a different approach. You may want to consider broadening your options or just waiting it out to see if the seller changes their mind.

Whether the final outcome is in your favor or not, the negotiation process is filled with learning opportunities. As a first time homebuyer, you will gain new insights from every negotiation. Your experiences will serve to make you more knowledgeable about the process and give you a greater insight into the best strategies to use with sellers.

Neither Rain nor Snow…

When you work in a busy office, you don’t like interruptions. This can be when some piece of equipment fails, the phones are down, the elevator is being repaired, or the power goes out. Those of you who live in winter climates know of what I speak. It happens with great regularity, and sometimes you are in the middle of something really important. Candles and flashlights may be plenty but they don’t provide enough light to continue to work. My office recently purchased a portable generator, similar to what many people have at home, that can power most of the equipment that you need. Office buildings generally don’t have them, so it is a good idea to invest on your own. You will appreciate its efficiency in a blackout. Neither rain nor snow may deter the postman, but it also won’t stop us from getting on with our work. This is particularly important when you are in the middle of drafting a contract, are talking to an important client on the phone, or when the deadline is looming for month and quarter-end reports. With a generator, you will always be on time.

I am so pleased with the reliability of our portable generator that I am tempted to take it home when I am planning a working weekend in my home office. The odds of the power going out are slim, but it can happen. If you pay attention to weather forecasts, you will know what to expect in advance. You won’t find yourself fidgeting in the dark worrying about how long your candles will last. A rechargeable flashlight is no help if you can’t recharge the batteries. When the power goes out, the first thing I do is take this flashlight and check the circuit breaker. But if it is citywide, or even just on my block, I want that generator to jump into action and let the propane-fueled motor do its job.

I remember one time the weather was so bad that we were stuck at the office and couldn’t make it home. I was worried that the generator would give out, too, and was hoping it would work faithfully through the night. Since we bought a really good one, it did. We decided not to work after hours just because we were marooned; but we had a nice social time playing games and having personal conversations over hot coffee. You can make the best out of a bad situation if you try. It is a good idea to have supplies, such as snacks, at the ready in your office should the power go out. I believe in preplanning and forward thinking at work and at home. No one wants to be helpless in these infrequent but possibly dire situations. Even if you don’t use it often, the generator’s presence is comforting because you know it is there. We researched well the many models and prices and I advise you to do the same. You will be glad you did during the next power outage.

Make Sure that Fireplace is a Selling Point

There are all kinds of tricks of the real estate trade that pertain to staging a house to sell it more quickly. You first must know your target market and what styles they prefer from antiques to modern. Trends are always changing and you need to survey what is selling and what type of décor is most popular. It is important to rid a home of debris and clutter and to bring in any furnishings that are lacking so that the house looks livable and appealing. People aren’t always good at imagining themselves in a given space or how their own belongings will look. You must make it more immediately apparent. Stages costs money for the realtor, but many of them consider it a necessary tax-deductible expense. If you don’t do it, you may find your percentage of sales drops. It is a fact of life of the business and thus many staging companies abound. You can also do it yourself but it takes time and a good eye.

Putting out clean towels and dressing up the beds is part of the staging job. Making the kitchen look functional and orderly is essential as well. Don’t just stack up appliances in one corner of the countertop. Artistry is the essence of the staging business. People all like a space that is homey, so analyze what it means for you and for them. Furniture in livings rooms must allow for sufficient walking space but also create conversation groups. Put a bowl of fruit on the dining room table and a vase of flowers in the entryway. You no doubt have heard about fresh cookies in the kitchen that make the house smell divine. Empty all trash cans, wipe mirrors down, dust as needed, and vacuum visible dirt. Maintenance precedes staging and you can hire a cleaning crew. Keep drapes open in the daytime and closed at night and make sure all views are highlighted for visitors that are surveying available properties. A good view is worth a million bucks.

Last but not least, if there is a fireplace, take advantage of it. It is usually the focal point of a living or family room. Make sure there are tools at its side, a nice screen for protection, a well stocked firewood rack and perhaps something decorative on the marble or tile in front. By all means, in the winter at night you will want to turn it on and encourage buyers to enjoy its warmth and coziness. I can’t think of a better area to stage than this.

Anything you do that makes the home shine in their eyes is going to help sell the property. This means talking about the best features to prospects and how they will enhance their lifestyles. Fireplaces, new kitchen stainless appliances, a work area in the garage, and a pool are among the many things that add up to a better price for a home. The cleaner it is, the more likely a speedy sale. No one wants to buy a fixer upper these days unless they are an investor.

Will Prequalifying Help You?

One of the most commonly asked questions is whether or not prequalifying for a home loan is helpful. In the same regard, many who have never shopped for a home before wonder if they should get prequalified or contact a real estate agent first. It’s important to understand what prequalification is, the benefits and when it is advised to proceed with this process.

What is prequalification?

The prequalification process is the first step before initiating a mortgage application. It’s not difficult to complete. In order to get prequalified you simply provide your lender with your income information, all debts that you owe and any assets that you currently own. The process is usually fairly fast and after analyzing the information that you supply, the lender gives you an estimate of the loan amount that you will qualify for.

Prequalifying versus Preapproval

Often, first-time homebuyers are confused with the terms prequalified and preapproved. It is common for them to believe that prequalification means that they are preapproved for the home loan. These are actually two different things and it’s important to know the difference.

Preapproval is a separate process that also includes a review of your credit rating to determine credit worthiness. Additional information is requested to confirm the validity of income, employment status, and proof of ownership for assets. The preapproval process is much more detailed and requires the submission of multiple documents. Your financial background falls under heavier scrutiny for preapproval.

You can quickly and easily get prequalified online or over the telephone and you won’t have to supply proof to support your financial status. There is no certainty that you will actually gain loan approval just because you prequalify.

The Benefits of Prequalification

It isn’t absolutely necessary to become prequalified before you meet with a real estate agent but it will give you a better idea of what you would be able to afford with regard to the price range. This information is helpful for both you and the agent to rule out homes that do not fit within your price range and it can save a lot of time and effort for everybody involved. While not required, it is definitely a good idea to seek prequalification because it is a fast and easy process, but don’t depend on preapproval until you’ve gone through the process to secure it.

Needle in a Haystack

I am always rushing around looking at properties, hoping to get listings, and showing them to prospective buyers. The life of a realtor is exciting for sure. Some days I have been known to traipse through ten or more homes. When I have an open house, I tote flyers with me and assorted information to leave on a table for those who elect to come through. I have a great messenger bag that I found online for this material. It is a cross between a traditional backpack and a kind of casual briefcase. It has compartments like a school pack does, but they are larger and more suitable for paper so that it doesn’t get crumpled. It also has a place for my keys, cell phone, wallet, and penknife. I also carry a small flashlight if I am trying to unlock a front door in the dark at night. It is an all-purpose model that serves me well. Thus, you can imagine how chagrined I was to find that it was not in my car one morning. I must have left it at the last open house as an oversight. How could I do this? I had to gather up the leftover flyers, so what did I do with them? I suppose I packed up everything and just left the messenger bag on the table. I didn’t notice since my keys and cell phone for in my pocket.

How annoying to have to check several open house locations in one morning to retrieve the wayward bag. Since I didn’t have my list of locations handy (of course, it was in the messenger bag —what else!), I had to randomly go from place to place as I could remember. It was like looking for a needle in a haystack and it ate up considerable time. I believe I have learned my lesson. As it turns out, I found the bag at the very last house I visited. I was grateful it was still there with all contents in place. I must find a way to remember it in the future so as not to fritter away time. I missed an appointment, and while I rescheduled, it was not a good move on my part with the client. Most people value their time and do not like to make changes to their schedule. But, alas, I had no choice.

My advice is to keep your wits about you after an open house so you not only tidy up, but take your belongings home. I get so enthralled with a good turnout that my mind is elsewhere—on making the sale. I am diligent about getting prospects’ names and phone numbers, and usually their business cards. That I never forget. I try to schmooze as much as I can before potential buyers make their way home and some priorities get lost in the busy shuffle. My messenger bag has all my sales literature and personal items, so it is vital that it never again get left behind. I am sure that it won’t.

I Have My Work Cut out for Me

Some clients are a pain, but most are quite agreeable. You get used to working with a variety of types and you adapt in each and every case. It goes with the territory in my job. You never are surprised by any behavior although I find that most property buyers (and sellers as well) are very nice. I put myself out and I know that they appreciate the effort and they respond in kind. I don’t mind when they have special demands as this is normal for a home seeker. They have their list of requirements which helps me narrow down the field and find the right property. Otherwise, it is all a waste of time. If someone wants a family room and there isn’t one, then cross that house off your list. If they have need for a specific number of bedrooms, this condition must be met. If they want an attached garage, a pool, a covered patio, a large backyard with or without a dog run, fruit trees, and modern appliances—well then you better oblige. Being a good listener is essential for any realtor worth his or her salt. Depending upon the client’s needs, you always have your work cut out for you.

Recently I had a client who insisted on a tankless water heater after reading these reviews, and hearing frequently that newer homes have them. Sellers are reticent about buying things to make a sale, but you need to explain to them that an item like this can make or break a deal, even if they don’t value it themselves. I can see why my client wants one. They take up less space, are more energy efficient, cost-effective in terms of utility bills, and easy to repair and service. Frankly, I wouldn’t mind having one myself. The descriptions on line make them sound essential. Being up to date is a homeowner’s dream. I didn’t mind intervening between buyer and seller because I find this request to be quite reasonable. It is always going to come down to the seller making the upgrade since most homes I am showing right now don’t have them. I am going to make the maximum effort to give the client what he wants.

I never like to complain about clients because they are seeking the ideal abode. They have every right to expect compliance with their wishes. My job is to make sure this happens. Most requests are easy apart from a demand for some remodeling. You can’t expect sellers to go to that extreme. The buyer must understand what is normally expected after a home purchase. You can go over the parameters when you first meet. It is part of the agent/client protocol so to speak. I even have a printed list for clients entitled “What to Expect in Buying a New Home.”

When Your Credit Isn’t Great

Being a first-time homebuyer when your credit isn’t that great doesn’t put you in the best position to purchase a home. While this is a given, it doesn’t mean that it will be impossible for you either. Twenty-five percent of the US population have credit scores of under 600. You probably can invest in a home if you have bad credit but you should also consider whether or not you should. Here is some information that may help you to decide if you’re in the right spot to buy a home or if you should wait until you’ve rebuilt your credit.

Can you honestly afford a home purchase?

If you have the disposable income to make a decent down payment and keep up with mortgage payments, homeowners insurance, pay annual property taxes and assessments along with satisfying your other debt responsibilities, purchasing a home may be a greater possibility for you. If you are current on all of your debts and in the process of rebuilding your credit, you may be a better credit risk than those who are in heavy default and not making an effort to get caught up.

Reasons for bad credit

There is room in your credit report for brief explanations of negative activities. For example, identity theft, divorce, illness, unexpected unemployment or the death of a spouse. Medical bills are among the most common reasons for otherwise responsible credit holders to fall into arrears. If your spending habits are unhealthy, it is not recommended that you attempt to purchase a home but if you are responsible, the situation is different.

Rebuild your credit scores

You have the option of waiting until your credit scores are higher. If you’re on track with your financial commitments you can raise your scores each quarter and may qualify for a home loan with decent interest rates within a year or two. If you feel that you just can’t wait, there are a few other options available.

Seller financing

It is possible to negotiate a home purchase with an owner who is willing to go through an escrow account and carry the contract on the sale. These are hard to find, but it is possible. In this scenario, all of the legal work, closing costs and financials are taken care of by you and the seller with the help of the escrow company handling your account.

Bad credit loans

Some lenders are willing to take a chance on some applicants with poor credit ratings. Be warned that you are likely to pay extremely high-interest rates. This may be a deterrent because you will be paying much more than the home is actually worth. The default rates on bad credit homes are higher because there is an increased risk due to the higher payments that are usually required by the lender.

Co-signer

You may have enough disposable income to easily afford to buy a home, but not qualify for a mortgage. In some cases, having a co-signer with excellent credit can make a difference. This is one of the better ways to secure a home loan if you’re in the process of rebuilding your credit.

Final thoughts

Having bad credit doesn’t always mean that you cannot purchase a home; it just means that it will be harder to accomplish. Only you can determine if it is worth the higher price that you’ll pay because of inflated interest rates with a bad credit home loan. If you’re among the lucky few, you can make a reasonable deal with an owner contract negotiation, but these are difficult to find unless you know the owner and they are willing to take a chance on you. There is no substitute for a good credit rating when it comes to purchasing a home.

Why Your Down Payment is So Important

A down payment is the cash amount that is put towards the selling price of the home. Higher amounts are attractive to sellers and may provide the purchasers with more negotiating power. Higher down payments increase seller confidence and they are more comfortable in the belief that the sale will go through without any significant problems.

How down payment is determined

Each loan programs have their own down payment requirements and these are generally determined by your financial history and your current situation. Income and credit history are taken into consideration and this information is used to arrive at the risk you represent as a borrower and the confidence that the lender will have in your ability to pay. If you are less likely to default on a loan, your down payment requirement could be considerably lower than if you are a high risk. While some programs offer down payment requirements as low as 3%, some are as high as 20%. Some veterans may qualify for zero percent down programs. You also have the option of raising the percentage of the loan if you can afford to pay a higher amount.

Advantages of higher down payment amounts

First-time homebuyers tend to go with lower down payments for a variety of reasons, but anyone who can afford to put down at least 20% down payments will enjoy certain benefits. Seller confidence is increased as well as the confidence of the lending company that you are working with. Higher down payments can result in lower interest rates that could save you thousands of dollars over the life of the loan. A higher down can also lead to lower monthly mortgage payments or a shorter contract. It provides a good start for building equity in this valuable asset that you are acquiring.

A few more tips

The more that you can afford to put down on your new home purchase the better. You’ll find that a higher payment will give you an edge over some other bidders showing interest in the property. The best way to determine how much you can afford to spend is to assess your current income, projected expenses and budgeting information and allow for a six-month window of unemployment in savings and total financial income resources. This can help you to avoid financial crisis and give you an idea of the maximum down payment that you can afford to make and still remain financially healthy.  In some cases, it may be best to continue saving for a while and wait until you are in the best possible position to purchase a new home. Some things to consider are your current credit rating, savings, and disposable income.

 

Finding a First Home

There are a lot of factors to consider when buying your first home. Most new homebuyers have an idea of what their dream home would be. While you may or may not be in a financial position to get everything that you want, there are some important things to establish before you start your search.

Price range

The first consideration is to establish how much you can afford to pay for your new home. There are some amazing mortgage calculators available online and they are free to use. You simply enter your monthly income along with expenses and credit rating and you can determine how much you can afford to spend on mortgage, insurance, the downpayment and other associated fees such as closing costs.

Size of home

It’s a good idea to consider any short-term additions that you may be making to your family. Are you single, married, do you have children, will you be having more children? If you’re planning to have kids in the next few years you’ll want to have adequate space to comfortably accommodate each member of the family.

Amenities and outbuildings

RV owners may want to select a home that is equipped with outbuildings, garages or shops to store vehicles and RVs. If you have pets or children you may benefit from a fenced yard or area large enough to accommodate pets or livestock if applicable. You may also want to consider the distance from neighbors. If you are a private person who enjoys a great view, you may want to consider looking for housing in a more secluded location.

Neighborhood safety and schools

Safety is a high concern for most first time homebuyers. While home prices are generally higher in the better neighborhoods, the quality of life is generally a little better. Areas with lower crime rates are more in demand than those in sketchier areas. If you have a family or are planning to have children, you also may want to check the school ratings for the areas that you’re considering. This information is all available online with detailed statistics including demographics, academic ratings and a listing of nearby schools in the area.

Driving distance from work

If you don’t drive a car you may want to choose a home in an area that has a good public transportation system. If you do drive, take into consideration the length and time involved in commuting from your new home to work. It’s a popular choice among many homebuyers to purchase a home in the suburbs and drive to work in the metro part of the city.

Condition of the home

When you’ve narrowed your choices down to just a few homes, make sure that you have full disclosures about the condition of the homes. If you have any questions, don’t be shy about being direct. If the home shows any signs of water damage or dilapidation you may be able to negotiate a lower price, but in the long run, it may end up costing you more than a slightly higher priced home that is in excellent condition.

These are the key points that should be addressed when looking for your first home. Know what you can afford, what you want, what you need and where you want to live. It may take a while to find what you’re looking for, but taking your time can help you to avoid making some common mistakes that first-time buyers often make. Good luck in your search.