

THE BOOK THAT REAL ESTATE AGENTS

**DON'T** WANT YOU TO READ!

By

"The For Sale by Owner Guy"

SMASHWORDS EDITION

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PUBLISHED BY:

The For Sale By Owner Guy on Smashwords

The Book That Real Estate Agents DON'T Want You To Read!

Copyright © 2010 by The For Sale by Owner Guy

All rights reserved. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise) without the prior written permission of both the copyright owner and the above publisher of this book.

Smashwords Edition License Notes

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* * * *

You can call me "The For Sale by Owner Guy." I am a father, husband; former certified home inspector, former real estate salesperson, former real estate broker, a real estate CEO, and a real estate industry leader. My knowledge and experience in the real estate industry over the last ten years has taught me a lot about the greatest industry in the world – the real estate industry. I have gone through many ups and downs in the real estate industry. This book will allow me to share my wealth of expertise in the real estate industry with you, a For Sale by Owner person. I can help you become more knowledgeable and confident in your real estate transactions, and this book will teach you the facts, tips, and mistakes that real estate salespeople will not tell you when SELLING your property.

And just why am I qualified to pass this information on to you? More than twenty-six corporations and entities got together and tried to put me out of the real estate business forever. Why? They knew I had the best product and the most knowledge, and almost every real estate company, bank, and attorney in my area feared my potential success. If you are a "For Sale by Owner" yourself, my aim is to make you more successful in your real estate transactions so you can send your real estate salesperson to the unemployment line Remember, "if you have the knowledge, you have the power!"

To learn more about the information in this book, feel free to contact me:

Email: forsalebyownerguy@hotmail.com

Website: www.forsalebyownerguy.com

**Mailing Address:** PO Box 339, Broadalbin, NY 12025

****

To Heather,

If it weren't for your backbone and support, my mind and spirit would have collapsed. Richard has a great wife with you by his side, and I am very thankful to have you as a true and honest friend.

To Ame,

You are a great mother, a great wife, and my true love. I cannot say "I love you" enough for being there to pick me up when I was down. You are the most important person in my life.. forever.

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Introduction

What makes me knowledgeable or so delusional (my daughter's favorite word) to write this book and expose important facts and omissions of the real estate industry? Allow me to explain.

I first got into the home inspection field as a certified home inspector. During my time as a home inspector, I attended many inspections with real estate salespeople (members and non-members of real estate associations) on the premises. What I observed was that their jobs were way easier than mine. I had to crawl in basements and attics and do many other visual inspections of mechanical and other parts of a property while the real estate salespeople didn't seem to know much (if anything) about most of the property or home components and asked me more questions than I asked them. I knew the real estate salesperson was getting paid approximately a whopping 7 percent commission of the probably inflated purchase price while I was only making $250 or so to do a lot of dirty work. I wanted in! One of my family members was a semi-retired real estate broker, and he offered to supervise me if and when I got my license as a real estate salesperson.

So, I was in. Not long after that, I finished the state requirements to get my real estate license, and off I went. There was a slight problem though. Being that my family friend had been out of the sales aspect of real estate for so long, he was lacking the up-to-date information and the paperwork needed to remain successful in the modern real estate market.

Conquer Problem Number 1. I knew I had to become a member of a real estate association and utilize their system and accumulated knowledge to get me started. I became a member of a real estate association in my area. The association had a highly regarded "Code of Ethics" that bound salespeople to certain standards of conduct.

In my ten years of experience in the real estate industry, I came across and worked against many real estate "buyer broker and selling" agents. I could not find one salesperson that actually had ethics, even among those who were members of associations with a written Code of Ethics. In addition to their lackadaisical attention to ethical behavior, most members of this association that I had experience with had little to no knowledge in the real estate business. These members were notoriously dumbfounded on how to fill out a listing or purchase contract. Most of these same members would step on or over another competing association member any way they could to get a listing or promote their own company. Members of this same association routinely bashed the living daylights out of me and my reputation with lies and erroneous statements. Why? Because they had a lack of knowledge and/or training – things their associations and companies should have provided to them. That is why any Code of Ethics advertisement should be taken with a grain of salt. While you're interviewing any real estate salespeople who are members of these associations, ask them to recite their own Code of Ethics. If I were a betting man, I would bet maybe one out of a hundred would be able to remember the Code of Ethics and Bylaws their company advertises. These look pretty on paper, but they never quite make it to reality, and this is unfortunate.

Within two years, I realized that being a member of this association was not all it was cracked up to be. I decided to not associate myself with this or any organization. Instead, I opted to become a licensed real estate broker (a real estate licensee who qualifies to own his own real estate company) and start my own real estate company. Even though the association had not done much for me, I did gain a couple of benefits during my two-year stay. The first major benefit was that I had the ability to network and learn from and about many real estate attorneys, who were quick to point out to me all of the loopholes in the current real estate contracts related to listing and selling a property. The second benefit was that I saw the competition and realized that with the lack of many knowledgeable real estate salespeople in this same organization, I could step in and be the major player in the area once I gained more knowledge than them. Third and most importantly, I was not mandated to follow many of the association guidelines, a fact I believe affected my real estate clients in a negative way. Furthermore, I did not have to wait around for the right time to promote myself and my revolutionary concepts to the public. I was out on my own and determined to become the major player in the area, and considering the competition, it didn't look like it would be much of a problem.

As usual, after I corrected all the mistakes all the other real estate companies were doing within my own company, I found myself still answering the same questions from potential clients:

  * How much is your commission?

  * How and where are you going to advertise the property?

  * What is my property worth?

These questions are what inspired me to jump out of the real estate line that had been going nowhere over the past 100 years and start my new direction.

  * Answer 1: I created a 0 percent seller commission strategy for sellers. What is better than 0 percent? Zero beats every competitor!

  * Answer 2 – With help from an out-of-the-area company, I created a website that does not disclose the Days On Market, otherwise known as a DOM. The same website allowed more than one picture of a property, as well as actual video footage (not cut and paste still photos pasted together) promotions of seller's properties. The website does not install "Reduced" on any client's properties.

  * Answer 3 – I realized very quickly that almost every potential real estate client wanted everything for nothing. I was bound and determined to change this _give my expertise to potential clients for free_ way of thinking. We all know time is money, so I charged a consultation fee that was fully refundable once someone listed with my company. This consultation fee allowed me to spend more time with my family, business, and clients who were serious about selling their property.

Since, I had the answers and/or solutions to the real estate industry, my business started booming. If a person or business does not value their own expertise, knowledge, and the products or services they offer, how can a member of the public value this same person or business? The only ones who did not like me and the way I was evolving the real estate industry toward the better were my competitors, New York State licensing at the Department of State, and any potential clients that were wasting not only my time, but also the time of most real estate salespeople out there. Society becomes very jealous of people climbing the ladder of success. Money, name recognition, and a great product proved to be so successful for me that I started and almost completed all the documents required to franchise my company and strategy across the country. I purposely resigned my real estate broker license and promoted another individual in my real estate office to become the new real estate broker.

The real estate industry is changing at a snail's pace. I was ready to set the real estate industry on fire until twenty-six entities and the judicial system blocked my efforts to succeed on a national level by slandering and defaming me and my corporation. This may have been a curse or a blessing in disguise; we will find out in the future. Until then, I am going to spread my real estate knowledge, experiences, and opinions to the many people who are looking to become more knowledgeable and want to pocket more of a profit.

If you are only THINKING about selling your property, this is _the_ book that will save you a lot of money and/or help you make additional money. This book will also make you more knowledgeable in the practice of real estate.

When you are about to sell the most important asset you have, why not invest in a book that guides you in the proper direction? Real estate salespeople are making mistakes and omissions every day in the listing, buying, and selling of property. Now is the time to value, market, and sell your property the right way to gain the most profit.

The facts, experiences, and knowledge in this book will make you a near expert when dealing in the real estate industry. Kick your real estate salesperson to the curb and say goodbye to paying real estate commissions. You don't need them. What you need is knowledge, and you will find that here, in these pages.

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Table of Contents

1. Are you in the real estate industry?

Disclaimer

2. Are you Ready, Willing, and Able to sell? Be RWA!

3. What is the value of your property?

A. Appraise Your Property

B. Have your property in Selling shape

C. Get the tax, electric, & heating/cooling bills in order

4. Should you utilize a real estate salesperson?

(Not an Agent)?

A. Do you need a real estate salesperson?

B. Real estate salespeople mistakes

5. Those darn TV shows

6. Do you need a real estate attorney?

7. How and Where to market your property

A. Signs, signs, everywhere there are signs

B. Pictures and Videos

C. Promoting your property on real estate

websites and in newspapers

D. Where and what does NOT work in

promoting your property.

8. Who's calling you?

A. Statements/Questions from purchasers

about your property

B. Determine what type of deed you are selling

9. Showing your property to a RWA purchaser

A. Get the pre-approval

B. This is my property

10. I would like to purchase your property

A. Offers are coming in

B. Don't be so emotional

C. No... You can't have my dog but I will throw

in my mother-in-law

11. Real estate laws do not pertain to you. Wrong!

12. Legal Documents

- Disclosures

- Contracts

13. My property is in perfect shape... Trust me

- Inspections

- Testing

- Inspection report

- I am not fixing anything

- "As-is"

14. What is holding up my closing?

15. I will meet you at my attorney's or closing agent's

office for the closing

-Broom clean your property for the new owner(s)

-Bring your Id

-Sign some papers, just don't read them

16. Let's sell another property

17. Notes to remember-

18. Attorney/Purchaser information

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Chapter 1

Are You in the Real Estate Industry?

You may be in the real estate industry if you own or rent a piece of property. In fact, if you do own or rent a piece of property, you ARE in the real estate industry – yes, you ARE a small player in the real estate industry simply by owning property. The real estate industry is composed of very small to very large players that make it go 'round and 'round. In my opinion, the real estate industry is the best industry in the world. You do not need to be a kazillionaire to start, and you do not need to be an attorney to understand real estate potential. If you are motivated, ambitious, and want to succeed financially in life, the real estate industry may be the perfect career (or new career) for you.

My ad reads:

_Want a successful career in a professional field with_ _unlimited income and your own hours?_ _No college or master's degree is required (currently)! Must only be motivated to succeed._

Sounds like a great ad, doesn't it? It's all true, for if you have the above qualities, being involved in the real estate industry is a great career for anyone, for players large and small. There are a variety of TV shows involving real estate success. Just think of how many home renovation shows or house-flipping shows you scroll through every time you pick up your remote. In my opinion, the real estate industry is the _BEST_ industry to become involved in. With good reason, there is a great deal of people with an interest or fascination with a little piece of real estate.

This book will cover many of the important and not-so-important tips and tactics it takes to sell a property, as well as warn you of the mistakes made by many real estate professionals, TV shows, and For Sale By Owners make in selling a property. I will include some samples along with analogies so the everyday Bob and/or Mary can understand and relate to the technical (or really not-so-technical) world of real estate.

Disclaimer

My stories and/or real estate knowledge are based upon _my_ experiences in the real estate industry. My _opinions_ reflect the positive and negative that has happened in my life in the real estate industry. This book is not to be taken as the REAL ESTATE _LEGAL_ LAW GUIDE for everyone all over the world. If at any time you feel a concern or have a question, feel free to contact a real estate attorney (not a bankruptcy, divorce, or malpractice attorney) pertaining to the real estate law that affects your real estate situation in your area.

This book should make you more knowledgeable and comfortable in your real estate experience when selling a property. Don't be afraid to kick your real estate salesperson to the curb!

Summary

  * If you have a roof over your head, you are somewhat involved in real estate

  * If you are unsure of anything you read in this book, consult a real estate attorney before you act.

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Chapter 2

**Are you** R **eady,** W **illing, and** A **ble to Sell? Be RWA!**

I always asked potential clients many times when they called my office to list their property, "Are you sure you and/or your family members are Ready, Willing and Able [RWA, in real estate terms] to really sell your property and close this important chapter?" Selling a property is not like selling a car or having a garage sale. Most homes have emotional, family, and other important meanings that affect the seller when installing the "For Sale" sign on the front lawn. In addition to asking them if they are RWA, I also immediately tried to determine what of the many potential revolving scenarios might have caused them to make that ever important decision to sell their property. Was the decision based on a financial, personal, or career situation, or was it simply a "The market is good... let's try to hit the lotto" decision (which is never a good idea)? Before I chose to work with a client, I realized that all family members affected by the sale of the property should be consulted with to be sure they were on the same page. I saw it happen a thousand times: the "For Sale" sign is installed on the property, and a couple days later, I got the phone call stating to me that the seller had changed his or her mind. There was always the apology for _wasting_ my time, but while I was sympathetic, I couldn't help being angry. Why? Because, time is money, and even more than that, my time was valuable to the clients who really needed to sell their property and to my family who needed me to be there as a father and a husband. My time – and yours as well – is more important than dealing with a seller who is only "thinking" about selling a home or dealing with someone who changes their mind within a couple days after I committed my resources to them.

In the attorney world and many other professions, there exists what is known as the "Retainer Agreement." These Agreements state the professional's hourly rate and/or the agreement of terms for the client to authorize monetary compensation to the professional for _time spent_ with the client. A simple sample of a Retainer Agreement might read something like:

Upon my authorization, I hereby agree to compensate Mr. Attorney $200 per hour for the legal services that Mr. Attorney will dedicate to my situation. If I terminate and/or change my mind in the hiring of Mr. Attorney for this service, I will still be liable to compensate Mr. Attorney for time spent.

Signed,

John Doe, 3-10-2006

In my real estate office, I got so fed up with my time being wasted that I composed my own agreement and became one of the first real estate offices in the country to institute a _Termination Agreement_ , which was basically, identical to an attorney Retainer Agreement. If attorneys and/or other professionals utilize this type of Agreement, why couldn't I? Attorneys hated it, the wishy-washy clients who were just thinking about selling hated it, and the New York State Licensing at the Department of State even hated it. Nevertheless, I still used it. The _Termination Agreement_ whittled down my _thinkers_ to my serious clients, who really needed my services, and in the end, the initiation of the _Termination Agreement_ made me more money than I lost from those who were disgruntled – not to mention it saved me a lot of misery and wasted time and effort.

Another decision I made was to charge a consultation fee. Refundable to those who followed through with listing with my company. I required this fee from potential sellers who didn't know the value of their property and were _just thinking_ about selling _._ I recognized this was where the greatest industry in the world – real estate – was still stuck in the 1900s. What professional commits time, gas, and knowledge (among other miscellaneous resources) for up to two to three hours at a time trying to get a listing or provide a valuable service for **FREE**? Do doctors come to your house for **FREE** when you are sick? Do attorneys come over to your house for **FREE** when you are in a legal conundrum? Does a dentist come to your home and diagnose your problem for **FREE**? To this day, almost every _real estate salesperson (not agent)_ goes to the potential client and provides valuable

_Real Estate Salesperson (not an agent)_ _\- A person licensed by the State to assist a licensed broker in the field of real estate._

knowledge, experience, and time for FREE.

And how will this patient, flexible, hardworking real estate salesperson be repaid for their time and trouble? Possibly with a " _For Sale By Owner_ " sign, another company's real estate sign, or maybe the property will even be sold to a friend or a family member without any compensation to the real estate salesperson at all.

_For Sale By Owner_ _\- A private person who wishes to sell an item by and for themselves._

I was the first to charge a consultation fee (minimum of $250), and I think I may have broken the barriers for real estate salespeople down the road. The smart real estate salesperson will value them selves, while the real estate salesperson who don't value themselves will be used as a marketing tool by other salespeople. If a real estate agency does not value him or her self, do you really think the same real estate agency will value your property? I disclose my experience above because the **FREE** ride of values, knowledge, and marketing reports shall hopefully come to an end in the real estate industry.

To the real estate salespeople who still provide all the above services for **FREE** to a client on the basis of merely hoping to get the listing, please know that you are killing your own real estate industry salesperson by salesperson.

To the potential client, I say, be a Ready, Willing and Able seller, and there will be no necessity for any of the above Agreements and fees. Everyone in the real estate industry has better things to do than waste time. The economy is tight right now, and we all know that every dollar saved is better for the economy and the financial future of the real estate industry. Let's concentrate on watching the real estate values grow.

Summary

  * If you are ready to sell your property, commit all of your efforts and emotions.

  * Don't look back or waste anyone's time.

* * * *

Chapter 3

What is the Value of Your Property?

Value in real estate is defined as "what a buyer will pay." So, what will a buyer pay for your property? Will they pay what you paid for the property plus the investments you've made to improve it? Will they give you $1,000,000, $100,000, or $1? The truth is, it will probably be none of the above. Unfortunately, there are no mathematical formulas that allow a seller or real estate salesperson to determine the true value of their property. This is due to the many factors that change and can affect the real estate value periodically and economically.

Sample Conversation

A phone call comes in, and the seller relays they have a three-bedroom home on fourteen acres with a two-car garage. They ask, "How much do you think I can get for my property IF I decide to sell it?"

As a real estate salesperson, I answer, "Sir, I do not have the ability to _see_ your home through this phone line. If you don't mind, can I ask you a couple questions? First of all, how much do you _want_ to get for it?"

He answers, "I don't know. That's why I'm calling you."

"Is the property in excellent condition?"

"Of course! I have spent $30,000 on improvements. It's beautiful."

I continue, "Are any other real estate salespeople (not agents) coming over to provide you a value?"

He replies honestly. "Yes. I have four real estate salespeople coming over to do a _Free Market Analysis_."

_Free Market Analysis_ _\- Some form of report that validates a financial dollar value based on previous sales of similar properties in the same area._

"How much is your property _tax assessed_ for?" I ask him.

He answers, "It's only assessed for $50,000, but I paid $150,000 six months ago, and I've added all the improvements on top of it."

_Tax Assessed_ _\- A valuation placed on a property by a public officer or board as a basis for taxation. Your assessment is located on your tax bill._

"Again, sir, I would like to be short and brief and save everyone a lot of time. How much do you really want to walk away with when I sell your property?"

"I want to net $275,000."

Wouldn't it be great if we could all buy property for a lower price with an outrageous assessment and then turn it around in a short time, making a boatload of profit on real estate sale? This type of sale can happen, but only about as often as you can hit the local lotto. Generally speaking, the stars and planets must be in perfect alignment before any real estate transaction would go this smoothly and profitably for the seller.

There are definitely some red flags that will inevitably be raised. First of all, a red flag exists if we come across a seller who claims they don't actually know how much they paid for the property and improvements. Most sellers and buyers are very knowledgeable about the real estate market. Sellers and buyers _DO_ keep track of properties in their area that have just recently sold, and sellers themselves often toss out the biggest nets to catch the local sales rumors. In my experience working in a real estate office, it seemed like I was the only one that did not know what every area property sold for, along with what every seller's situation was when the property sold. Nine out of ten times, the private sellers were wrong in their assumptions. It is best to let the local real estate salespeople and appraisers do their jobs without creating rumors and competition that push up the local values. Buyers are very smart these days, and they will determine the value of your property. Overprice your property, and it will sit on the market forever, just like the others you drive by and see every day!

Are you serious about selling your property, or are you a "Cloud Nine Seller"? A Cloud Nine Seller is the kind of property owner who says, "I don't need to sell my home, but if I do, this is what I feel its worth, and I won't take a penny less"? Some sellers list their property from $30,000 to $50,000 over market value or more, forgetting that buyers do know which properties are overpriced – especially when they have many homes to choose from. If you're Ready, Willing, and Able to sell your property, do your homework, and market your property at a price comparable to similar property sales in your area. Look to see what properties are being marketed and at what price. Take your time and go to a few open houses (even thought I don't condone the practice of open houses, which I will discuss later) of properties that fall within your listing price. Again, buyers are very smart, and they will find information on what you paid for your home, how much the assessment value is, and any improvements you may have done – all information accessible to any clever member of the public willing to spend the time to look for it.

Another red flag is that the seller wanted more of a return based on the improvements that have been done to the property. Just because you have spent $30,000 on improvements does not mean you are entitled to the $30,000 on top of the purchase price you initially paid. Did you hire a contractor that charged you too much for average work? Were the improvements you made something the general public would find useful and enjoyable, or was your $30,000 spent on installing a Jacuzzi off the bedroom? The simple truth is, most improvements do not net you the same amount back when selling your property.

Another red flag was the seller's question, "What is the value of my property?" Another interpretation of this question might be, "Can I get a real estate salesperson to solidify my pipe dream price? The lotto ticket just has not been working lately."

Based on these red flags, we could safely determine this seller is NOT a RWA seller. This person is just shopping for some **FREE** advice and knowledge from a professional, and there is no way I would waste my time visiting the property. However, there are ways to find out if the seller is actually serious about making a sale.

"Sir," I say, "I would like to come over and provide you with a _B_ _roker's_ _P_ _rice_ _O_ _pinion_ (BPO) for the fee of $250, which I will refund to you after you list with me. You can use this unbiased, professional report in any way you see fit to help sell your property. What would be a good time for me to come over to get you a BPO?"

_Broker's Price Opinion (BPO)_ _– An unbiased report composed by the real estate brokerage. The report is based on all factors of the seller's property combined with the selling factors within the similar area of similar properties. The report should be based on the presumption that your real estate firm is not getting the listing, and no bias should be placed in the report for the actual value that you are being hired to compose for your client._

He answers, "None of the other real estate salespeople I talked to are charging me, and I'm not about to pay you," and promptly hangs up.

So, did I lose this client? No. Instead, I saved time, gas, knowledge, and know-how that I can utilize elsewhere with a more serious client who plans on following through.

Bear in mind that when a _purchaser_ comes to view the property, the tax assessment issue will be raised. A property with a low assessment and a high "offered at" price (which is different from an asking price) will cause concern to the purchaser.

_Purchaser -_ _A person who is serious about compensating you for your item and will actually set the value._

Ten out of ten times, the potential seller did provide me with a net amount they wanted to achieve, though this sometimes required that I asked the same question in two or three different ways. Remember that almost every serious potential seller _DOES_ know the figure they are seeking and is just looking for a real estate salesperson to justify their dream profit. If you're that dreamer, this book isn't for you. You need to contact a real estate salesperson who is willing to waste your time – someone who will eagerly try to sell a property neither you nor they are really serious about selling.

You might wonder why the above seller wouldn't call a real estate salesperson and ask the same question. It's **FREE,** it doesn't cost the seller a dime, and the seller gets valuable knowledge and experience from so-called professionals. Heck, if I did not know what goes on in the real estate industry, I would do the same thing. But does it really work? The simple answer is NO!

Think of it this way: if you had a serious physical problem, would you seek **FREE** advice on the Internet and trust your health to it, or would you see a doctor for an unbiased, professional (albeit it expensive) opinion and advice? If you were seeking legal counsel for an issue that could very well affect yours or your family's wellbeing, would you go to the Internet for **FREE** advice or visit a professional attorney who will probably bill you for their time? For most sellers, their property is the most important investment they will ever make in their lifetime, so why NOT seek the best person(s), knowledge, and experience? There are plenty of "yes-men" out there who will do all they can to appease you and get their signs on your front lawn, but if you want to get true value from your property sale, you should seek advice that is truly of some value.

Did I answer the most important question you have for me as a real estate salesperson? Not a chance but let me put it in simple terms. Value is what a purchaser will pay for an item. Whether it is a property, a car, or a video game, if it is priced too high as compared to other items like it in the same area, it will not sell because its value will be perceived as less than what you are asking. Your only option? Adjust your price. By the same token, if the price is too low, you will have too many people coming over to buy it, and there may be some perception that there is something wrong with what you are trying to sell. Your only option in this case? Adjust your price – yes, you CAN raise your price, legally and ethically. Your "value" is somewhere in between these two. When a purchase is made, the purchaser has set your value. Never does the seller, the real estate salesperson, or the appraiser set the value. **Value is always set by the purchaser** , even if you did spend $30,000 adding that Jacuzzi to your bedroom.

Summary

  * The value of your property is what a potential purchaser will pay, not the amount you hope to get on the off chance that all the planets are correctly aligned.

  * DO price your property with a fair value.

  * DON'T overvalue and overprice your property. If you do, it will be on the market longer and can cause a plethora of negative consequences for you in many ways.

* * * *

### 3A

Appraise Your Property

One of the best ways to get near the true value of your property is to hire (and this means pay or compensate) an unbiased _appraisal_ BEFORE you list your property.

**Appraisal** \- An estimate of a property's valuation by an appraiser who is usually presumed to be an expert in this work and is licensed within your area to transact appraisal reports recognized by the Appraisal Institute.

While the appraiser is at your property conducting their appraisal, DO NOT TELL THEM YOUR PRICE. Remember that you are compensating them to do the best job they can do with your money. Trying to influence them with your pipe dream price is not good for you or your money. If the appraiser is also a licensed real estate salesperson, don't hire them. There is a very slight chance they can be unbiased, but it is not a risk worth taking. Would you hire a doctor who had a vested interest in a pharmaceutical company or a doctor whose only duty was to care for your wellbeing? Only hire a licensed appraiser who is a professional in the field of appraisals – not a person who will give you the number you want just because they want your listing.

Another good way to get a value of your property is to go to your local county filing office. Real estate transactions are filed here with almost all the pertinent selling information. This information is public and **FREE**. Inquire, make copies, and ask questions of the people who work there. Your local, public, county office is the real estate Bible of what properties have sold for within the timeframe you need (usually the past three to six months), the addresses of the property locations in your area, and the tax assessment on all properties (if these are not on your local tax bill or you need assistance understanding your tax bill). Check to see if the county office in your area is accessible on the Internet, for you might be able to save time and gas by accessing and printing off all the information you need.

You might say, "Wait a second... the county has already assessed my property, and I do have a value." This is something I frequently heard from potential sellers, especially when the assessment was higher than the fair market value. Every local municipality has assessed every single piece of property in order for taxing that same property to raise income for local services. Most assessments from localities are usually close or right on the mark of a fair market valuation, but only for a short period of time. After a year or so, the fair market value of that same property is not the same as the property assessment a year earlier. Most localities decrease the equalization rate to fair market value each year. The first year your property is assessed at 100 percent value is the most likely time period that your property was assessed with the correct fair market value. After the initial year of 100 percent assessment, your percentage of your valuation is decreased almost ever year until your local municipality imposes another revalue of your property's assessment (usually every three to five years).

As an example, I once came across a lakefront property with a newer four-bedroom home, an attached two-car garage, and approximately 100 feet of direct lakefront. This property was assessed at or about $250,000 with a fair market value of $700,000. This was the perfect scenario for the seller, whereas the seller only paid taxes on the $250,000 but tried to sell the same property for much more. The opposite of this same scenario also happens in that the property is sometimes assessed at the higher amount, but the fair market valuation is lower than the current fair market value of the property.

To reiterate the initial point, assessments for a fair market valuation are usually correct only for a short period, but usually incorrect for a longer period of time, especially if your municipality does not hire revaluation companies to bring the assessments back up to 100 percent of fair market valuations.

Lastly, a tool I liked and utilized often for clients (who were Ready Willing and Able sellers) was a website that allowed the access of a municipality's assessment records via computer. If you search the Internet, you will find many of these websites out there with public real property services for a fee. These websites offer Internet access to the public real estate records needed when making a professional decision to get a property near the value it needs to be for selling purposes. Bedrooms, lot size, tax assessment, past purchase prices, school district, and other pertinent information is there at your fingertips, and this information is well worth the site membership fees.

By far, the worst place and/or person to get a valuation from is a real estate salesperson (not agent). Under real estate law within every state, your salesperson has a _fiduciary duty_ to represent your interests first, foremost, and forever – even after your sale is completed. While this sounds all fine and good, 99.9 percent of the time, this does not and will not happen. Why? A real estate salesperson's real goal (in most of their minds, anyway) is to get as many listings as they can, practicing the mindset of "List to Exist" instead of the idea of "sell, sell, sell," as they should be.

_Fiduciary Duty_ _\- The specific legal duty an agent owes to the principal._

Listing properties is where most of their money can be made, and it's the name of the game. If a real estate salesperson (not an agent) can list and sell their own listings, they have made the most money on your property they were allowed to make under their listing agreement. In my real estate experience, the seller(s) almost always wanted a real estate salesperson (not agent) to solidify their pipe dream price. The salesperson who was quick to say yes to the sellers' needs got the listings. This is one of the worst ways to list and/or try to sell your property, and it is a tactic I highly do NOT recommend.

Also, don't fall for the _Fair Market Value Report_ that a real estate salesperson may provide you when a value is requested on your property. Such a report from a real estate salesperson has little to no value for any seller who is looking for guidance.

_Fair Market Value Report_ _– An unregulated report provided by the real estate salesperson to the potential seller that seemingly shows what other similar properties have sold for in a similar neighborhood. This report has no national criteria for all other real estate professionals to follow, and almost no_ _municipality or other legal entity accepts these reports for legal or technical reasons._

There are no criteria in real estate for any real estate salesperson on creating Fair Market Value Reports. What this means is, you can contact as many real estate companies as you wish, and each Fair Market Value Report will look different than the others. These reports have different information, comparables, guidance, and variables, and they may actually confuse sellers. These reports are usually generated for no cost from the real estate salesperson. There are no local, state, or federal association standards to create one of these reports (unlike a certified appraisal), so expect little to nothing when you get one. How much valuation can anyone expect from a report that the same real estate salesperson themselves installs no value in for the actual cost to provide the report to the seller? If you want a report for free, it will be well worth only what you paid for it. If you have a Fair Market Value Report from a real estate salesperson, make sure the garbage can is nearby, because that is the best place to file it – in the trash.

Another negative way of installing a value on your property is by listening to your uncle, aunt, grandmother, mother-in-law, or real estate friend located in another area across the country. Every person has an opinion in real estate because every person has been or knows someone who has been touched by the real estate bug, sold a property, or is a fan of the latest house-flipping real estate TV show. As much as you love these people, don't take your real estate advice from them. It is by far the most emotional and wrong way to install a near value on your property.

Unless you live in place where there are brand new condominiums selling at the exact same market time, do not expect to get the same exact final purchase price as a similar property may have sold for. There are so many factors that affect the sale of a property; location, upkeep, area, crime, school district, taxes, and number of bedrooms, just to name a few. Among these factors, timing is the most crucial. If the economy or situation is not right, do not expect top dollar for your property. If the timing is right in your local and the national economy, try to combine all the selling factors into your property to get the best and most dollars in return.

Summary

  * If an investment broker asked you to spend $250 to $400 to possibly earn thousands, DO hire an unbiased, licensed appraiser BEFORE you list your property and call the real estate salesperson.

  * If you want to get value without spending a lot of dollars, go to your local county office building and spend the time. See for yourself what the neighbors' properties really sold for instead of relying on what they told you.

  * If you want a fair valuation of your property, DON'T ask a real estate salesperson to come over. The majority will only confirm a high price for you and not provide you with the expertise and unbiased advice you are seeking.

  * Remember that Fair Market Value Reports from a real estate salesperson are free, and they're worth every penny, which isn't saying much.

****

### 3B

**Have Your Property in** _Selling_ **Shape**

The above statement never seems to click with most sellers. Sellers want the most money and the best terms. It would seem, then, that common sense dictates that the property should be in the best shape possible to get the best value. This requires a little time and labor to take care of the obvious items on a property that any purchaser will notice, absorb into their mind, and spit back to me and/or my seller when negotiations of a purchase offer begin on a property. Don't provide purchasers with any ammo to lower your _offered-at_ _price_. The purchaser is responsible for themselves.

_Offered-at Price_ _\- A command statement that contains a value the seller would like to be compensated for._

I provided my sellers with tips on making their property a little nicer before we took pictures and videos or placed signs on the property. Once the sign is placed on your property, a lot more attention is also placed on your property by everyone in your neighborhood. If the property needs major attention and is obviously a money pit, it is best to disclose the obvious and price the property accordingly, noting the factors that might require intensive labor and monetary attention. Most sellers do not do the minor upkeep around the property for the same reason I do not. I get lazy every now and then, or I have better things to do with my life other than working on the honey-do list. _Do I mow the lawn or take a nap? Hmm... let's see. The lawn will still be there tomorrow, and a nap is good for you. Raking leaves or watching football? Well, if I can do a quick leaf blowing over into my neighbor Joe's yard instead of spending the time to rake, I can probably get done by the end of half time._ The fact is, maintaining our real estate is sometimes a bit cumbersome and unappealing, but anyone thinking of selling a property must do what they can to make it look its very best – naps and football aside.

When you are selling a property, your property needs to appeal to the majority of purchasers – not the minority. The most important single decision of a purchaser is, "Does this property have curb appeal?" Curb appeal, curb appeal, and more curb appeal is good, so forget the Sunday afternoon nap and head to the nearby construction supply store, or your nearest landscaping or home improvement place and get that property into shape.

To give your property the best curb appeal in order to attract purchasers, there are many things you can do and many things you should avoid doing.

Do...

  1. Patch all holes and/or dents or gashes in the walls or ceilings.

  2. Use white paint to paint any walls that require painting. White is a neutral color that can also be used as primer, leaving the purchaser to decide what color they want to go with once they own the property. White also gives the appearance of cleanliness. If you do need to pick a color while painting a room, utilizing soft colors is also recommended.

  3. Shampoo and clean the carpets and/or hardwood floors.

  4. Organize the inside of your property. Get rid of your junk and make your rooms, closets, and property bigger by doing so.

  5. Remove garbage, cat litter, and any other odorous items out of the house. Replace them with a scented candle or another item that smells nice.

  6. Mow the lawn, pick up yard debris such as leaves and sticks, trim the shrubs, and weed any flower gardens.

  7. Paint any small outside area of the property or garage that states, "I need to be painted."

  8. Organize all your outside items. There really is no reason for the snow blower to still be sitting on the patio in the middle of August.

  9. Freshen up any problem areas in your lawn – like that patch of grass that has been missing for five years since Fido decided to take up track and field and run laps around his dog house.

  10. There is a high probability that one or more of your potential purchasers may be male, and most males salivate at the thought of a clean, organized garage, workshop, or storage shed. Tidy up by storing things in tubs and boxes.

Don't...

  1. Don't leave the junk car or other large debris in the front yard. Just because it is difficult to find a way to haul away a broken toilet does not mean it should become a front-yard planter.

  2. If you need a major renovation somewhere (roof, chimney, broken glass), take care of it if you can financially afford to do so.

  3. If you are selling a property, move all your outdoor social activities to the back of the home. Some purchasers will be too intimidated to drive up in the driveway just to look if there is someone on the front porch or lawn.

  4. Remove all dead plants, trees, and shrubbery.

  5. Remove all team, sport, and logos, other than your country's (which is most likely something everyone has in common). Remember, you must appeal to the majority, and not everyone likes the football or auto racing.

  6. Put the dog, giraffe, elephant, or other pet out back.

  7. Be sure there is no leftover food or dirty dishes in the sink of the kitchen or other areas.

  8. Unless you have absolutely no choice, send the kids out for ice cream or to a friend's house or over to Grandma's during all showings. Remember, kids say the darnedest things, and it is not worth the risk.

Don't forget to clean your bathrooms, particularly around the toilet and tub. Buyers WILL move your shower curtains to see where they might be bathing. For a few dollars, a new caulk job around the tub can work wonders.

If your property needs a little paint around the windows, paint them. A can of paint nowadays costs little more than $20 – a relatively inexpensive investment that might prevent you from losing thousands in the deal when the purchaser uses that crackled window seal as an excuse to claim the whole house needs repainted. Remember that purchasers will magnify any repair expense because that is their job. They are, after all, setting value, and they want that value to work in the favor of their own wallet. Sellers, on the other hand, always minimize the cost to fix or repair items. The best solution for the seller is to remove the potential fixes or repairs in entirety. Do them yourself if you have the capability and save yourself thousands of dollars in the process.

It is not uncommon for a seller to hire a professional to come over and provide advice to them about major revisions "needed" before the property is listed. In fact, some of my potential clients have informed me they were told they might have to spend anywhere from $5,000 to $50,000 before they could list the property. I found this shocking and wondered what professional would have told fed such nonsense.

There is no reason a seller with a property currently valued at $100,000 should spend another $10,000 to $20,000 just to get $130,000 from the property. The whole idea is simply absurd. Why? Let's clarify a couple things. Most of my sellers are NOT contractors. Most of my sellers are not mechanically inclined enough to construct a major addition to a property, and most of my sellers do not have the most important feature needed in undertaking such a large project: TIME.

Why wouldn't a seller accept the $100,000 from a purchaser, and save themselves not only the $10,000 to $20,000 in extra repairs and upgrades, but also the time, inconvenience, and worries involved with contractors and major decision making? Listing the property at $100,000 is a better option than spending time and money just in the sheer hope that the seller might get $130,000 at the end of the selling rainbow, of which there is no guarantee. I almost always advise my clients to forego the additional investment, time, and emotions in lieu of taking the current fair value and pocketing the additional money they were about to spend. The reason that clichés are clichés is because they are often true, and the two that hold water in this case are time is money and take the bird in the hand. Just say no to that major addition before you sell – unless, of course, you're being offered a spot on the latest show on TLC.

Summary

  * Get off the couch and clean the inside and outside of your property. The nicer your property is, the more potential for a higher selling price.

  * Spend a little money and time to fix and clean up your property.

  * If your property needs major renovations, reduce the fair value of your property for the same amount and save your time, money, and personal emotions.

  * DON'T invest your time, emotions, and hard earned money on your property for a large project ($5,000 or more) with a minimal percentage return with no guarantees.

  * Remember that there is actually very little reality in so-called reality TV. If you watch too many TV shows and believe in them, you may not be the one living in reality.

****

### 3C

Get the Tax, Electric, and Heating/Cooling Bills in Order

Let's take all concerns about owning your home away. If your property taxes are high, it is usually the same for everyone who lives in the area. The purchaser needs to know the approximate yearly taxes. This expense should be disclosed honestly to all potential buyers who inquire so that the buyer can better judge the property's affordability. The tax payment is an added expense on top of the mortgage (if applicable), and they must be able to determine if they can afford it. If you quote the potential purchaser a tax amount that is too low, they may have their mortgage approval declined right before the closing (where you get your money). This can be very emotionally disturbing from both sides of the process. Sellers need to be upfront about the current taxes on their property. If you do not receive a tax bill (you can have mine!) and your taxes are paid through escrow (extra payments within your actual mortgage payment applied to your annual tax bill), take a local trip to your local county office building and get a copy of your yearly tax bills so you will know you are giving your potential purchaser a truthful amount.

Another common question from purchasers is, "How much is the average heating (during the colder months), cooling (during the summer months), and electric bills on this property?"

I usually answer, "Every person is different. Some people like it warmer or cooler than others. Some families are large, and some families are small." I answer this way because it is the honest truth; the utility bills can vary significantly depending on the person(s) who use the utilities.

I do ask my clients for copies of their latest PAID utility and fuel/heating bills because I have no problem showing these paid bills to prospective purchasers, as long as personal account information has been marked out. This is pertinent information that anyone will have to consider when buying a property.

Potential purchasers must be have information on utilities and taxes because affording a home and keeping it long-term requires budgeting for all the expenses involved with that property; this is much better than going in unaware and enduring foreclosure, which will reduce the property values of others within the similar area, not to mention ruin the financial standing of the potential purchaser.

Summary

  * Being forthcoming with tax and utility information and documentation in the beginning is a good thing – it saves time and reduces emotional distress for both the buyer and seller.

  * DO have all your utility, tax bills, and any other necessary documents available for the potential purchaser.

DON'T reply, "I don't know how much the taxes or utilities are. The bank pays them." This is a red flag to everyone.

****

Chapter 4

Should You Utilize a Real Estate Salesperson (Not an Agent)?

As you can see throughout most of this the book, I have referred to "real estate salespeople" instead of "real estate agents." The reason for this is because most states refer to licensed real estate professionals in their real estate law books as "salespeople," and not "agents." While the real estate salesperson is technically an agent of the client, the real estate salesperson cannot or should not advertise themselves as a real estate "agent"; in fact, it is illegal in some states for a real estate salesperson to promote themselves other than a real estate salesperson. This should be one of many tests in the interview process of finding a successful and knowledgeable real estate salesperson if a seller decides to utilize a real estate salesperson's service. A licensed real estate salesperson who lists (signs an agreement to sell a property for the seller's best terms) with a seller has a fiduciary duty to represent the seller's interest at all times – even at the conclusion (either sale or no sale) of the listing agreement.

Most people perceive every real estate salesperson as being a member of a real estate association, but this is simply not the case. There were 1,257,686 associated real estate members with 1,443 associations as of August 31, 2008. I would estimate that nearly half of all licensed real estate salespeople are NOT members of a real estate association. Real estate members of some associations are required to adhere to a stringent Code of Ethics in the real estate industry. Membership in some real estate associations sometimes connotes a higher standard of service and ethics, but this standard is NOT a true one in most cases!

Is listing your property with a real estate salesperson any different from listing it with a real estate association member? Like any profession, some members will be better and more successful than others, regardless of whom they associate with. In my opinion, it is a crap shoot either way, and the odds are against the seller who is looking for a good real estate salesperson. Always interview several candidates, for the sale of your property is too important to put in the wrong hands. Some qualifications to look for when interviewing are:

  * Must be a licensed real estate salesperson within your area.

  * Must be knowledgeable about your area and the real estate industry in general.

  * Must have experience. Everyone has to start somewhere, but let the newbie work on someone else's property!

  * Must be computer literate.

One thing to note is that while it may not seem so, hiring a relative or friend who is involved in real estate or is licensed as a real estate salesperson in your area is generally a good thing. One reason is because your acquaintances will be much easier to get in touch with when you have questions or concerns. Also, remember that if the property does not sell or has been listed on the market for a very long time, it could be you preventing the real estate salesperson – whether an acquaintance or an outside hire – from doing the job you need them to do. Hire someone you can trust to do a good job, and don't get in their way while they are trying to do it.

Currently, there are no unbiased agencies or government statistics to verify any claim that it is better to hire a real estate salesperson to sell a property as per selling a property For Sale By Owner. Do not be swayed by any organization's statistics that may have an interest in their own industry members. If a real estate association states that the real estate sales have gone down over the past quarter, this same statistic can also mean that more For Sale By Owners have successfully sold their property without a real estate salesperson who belongs to a real estate association. If a real estate association's own members' sales go down, For Sale By Owners can rise. Hooray!

Summary

  * Be comfortable with all aspects of a real estate salesperson BEFORE you hire them. Interview them thoroughly as many times as you need to. Feel comfortable with them before you trust your most valuable asset to them.

  * Make sure you interview many real estate salespeople if hiring a real estate salesperson is for you.

  * Make sure the real estate salesperson you hire is a licensed real estate salesperson within your state of residence.

  * DON'T always believe that if a real estate salesperson has big initials or fancy awards next to their name, they are the most qualified or perfect fit for you and your family.

  * DON'T disregard the real estate salesperson that tells you what you really don't want to hear but is professional and informative in explaining everything to you may. This salesperson may be the perfect partner for you in representing your interests if selling your property yourself is not for you.

  * DON'T believe you have to sell a property through a real estate company – because you don't.

****

### 4A

Do You Need a Real Estate Salesperson?

Hiring any type of professional is a serious decision, whether you are hiring a plumber, an attorney, or a real estate salesperson. Many considerations need to be taken into account if you are indecisive about selling a property yourself or through a licensed real estate salesperson. There are many important questions to ask yourself.

**How much time and/or monetary resources can you dedicate to selling your own property?** Selling a property involves phone calls to potential purchasers, attorneys, home inspectors, appraisers, real estate salespeople, etc. In addition to this, it also involves promoting your property not only in your local area, but also nationally for those who might potentially be moving into your area. Utilizing a "For Sale" sign, Internet, local newspapers, and other advertising outlets can cost a little bit of money or a large amount of money, depending on the source.

**Can you remove your emotions when selling your own property?** Almost every property owner has personal and emotional ties to the property they are selling. Maybe the home has some familial significance, or maybe there was an emotionally charged reason you bought the house in the first place. Purchasers may low-ball an offer to you in an effort to gauge your financial situation. Are you showing too many emotions, or are you a cool poker player about to lose your property through _foreclosure_ but negotiating like all the cards are on your side?

_Foreclosure_ _\- A procedure whereby property is pledged as a security for debt and is sold to pay the debt in the event of default in payments or terms. If you do not meet the financial terms and/or make the payments for the property you have, the bank will take the property back for resale in order to re-coup the debt you promised to pay for._

Having a purchaser stroll though the property you have lived in, made memories in, put a lot of work into, and possibly invested a lot of money in and say, "This place is ugly and not for me" can really upset a seller. Once a person (buyer or seller) is angry, emotions start to speak, thereby costing someone serious money through negotiations and the sale of the property. Keeping the emotions out of selling your property is something far easier said than done.

**Do you have a good attorney to represent you in the proper disclosures, contracts, and documents that need to be filed within your local county office to make the real estate transaction legal and final?** It does not matter if you are selling your own property or hiring a real estate salesperson to sell it for you. In either case, there are certain documents that must be signed by both parties (buyer and seller) when terms have been agreed to or are about to be agreed to. A good real estate attorney can provide all the legal documents you need or that your area requires by law. This same attorney can represent your interest when drawing up a new deed, file the proper documents within your county office, and assist you with answers to questions to make sure what you are saying and doing is legal in your area.

I recommend that everyone have a consultation with a good real estate attorney BEFORE you hire a real estate salesperson and start the process of selling your property yourself. Most initial consultations are at little or no cost, and the benefits can be priceless.

As stated prior, there are good real estate salespeople, and there are bad real estate salespeople. There are many misconceptions about real estate salespeople that deserve to be evaluated here.

**Misconception 1:** **A lot of real estate signs around with either the same real estate salesperson's name and company indicates this particular salesperson and company are very successful.**

This is a misconception because all this tells us is that the only thing the real estate salesperson has been successful at is _listing_ properties – not necessarily selling them.

_Listing_ _\- A binding contract between a property seller and a real estate brokerage to advertise, promote, and bring in a Ready, Willing, and Able purchaser to the seller and net the seller's appropriate selling terms. Once this has been accomplished, the seller agrees to compensate the real estate brokerage a "Fee for Service."_

Success as a real estate salesperson comes from listing and selling properties for the sellers. Listing a lot of properties doesn't make a successful real estate salesperson. Most real estate salespeople will take any property to further misconstrue the public on the List to Exist statement. The good real estate salespeople will be those who DO NOT take every listing but sell the majority of the listings that they do take. Look for the "SOLD" signs; the person and/or company that has the most "SOLD" signs are usually the most successful.

**Misconception 2:** **The real estate company will automatically put my home on the Internet or on some sort of system where everyone will see my property. I do not know how or where to do this, so the real estate salesperson is the only person who can promote my property on the Internet.**

If I had a penny for every time I had to talk about this big myth, I would be relaxing on my own island loving life even more than I do. When you list your property with a real estate member who is associated with an association, your property gets an ID number. Unless a potential buyer knows your exact ID number (which is highly unlikely), the potential purchaser is going to have to spend a lot of time searching for your property. Most purchasers will spend only a couple seconds to a couple minutes on any given real estate website. In that couple seconds, what are the odds that your property will be the first (and quite possibly only) one the purchaser views?

The Internet is drowning in real estate sites. Most websites show both real estate salesperson properties and properties For Sale By Owner, though some sites only offer one or the other. This is the problem. There is no one dominant real estate website that offers the most advertising capabilities for BOTH For Sale By Owner and for those properties to be sold by real estate salespeople.

If you are computer literate, you will find it easy to upload and post photos and videos to a real estate website by yourself. It does not take a rocket scientist to do this, and there is no master's degree required. Almost anyone can do it!

Misconception 3: Everyone who comes to see my property has been financially validated to purchase my property – especially if the real estate salesperson assured me, "They got cash."

Thinking this way is yet another waste of time for everyone involved. In my experience, maybe one out of fifty (2 percent) of prospective purchasers have been _pre-approved_ before the purchaser has started calling my office or viewing properties to become more knowledgeable about the actual price range they can afford. Whether or not a purchaser is pre-approved (not _pre-qualified_ ) is the single most important question to ask BEFORE you show them your property – not during or after. Nevertheless, many real estate salespeople still do not get purchasers pre-approved before bringing them to a property that has been listed for sale.

_Pre-approved_ _\- A recognized financial institution has viewed the purchaser's credit and provided the same purchaser with a letter validating the purchaser's financial capability or incapability to purchase a property._

_Pre-Qualified_ _\- A qualification based solely on questions asked of the purchaser without viewing the purchaser's credit or validating financial capability through proper channels. No capable, intelligent real estate salesperson or seller should rely on this so-called qualification._

Sample

A very overpriced property listed by one of our List to Exist real estate salesperson sees absolutely no action. The seller demands the real estate salesperson get some people in his/her home. The real estate salesperson brings purchasers who are NOT pre-approved to the property to pacify the property owner's demands. The property owner asks the real estate salesperson, "What did they think of my property"?

The real estate salesperson responds, "They said it was not in their price range and is way overpriced."

To avoid a confrontation with the seller in this case about why the price on the property should be reduced, the real estate salesperson chose to pacify the seller, even though he knew it was overpriced to begin with. In the end, all the real estate salesperson accomplished was wasting the seller's time (and getting their hopes up for no reason), wasting his own time, and even wasting the potential buyer's time.

Anytime your property is being shown to a prospective purchaser, demand a copy of the pre-approval letter from your real estate salesperson before the property is shown. Unless you have required this action (pre-approved purchasers only) by your real estate salesperson in writing (at the time of listing your property), your real estate salesperson is NOT required by law to you're your property to pre-approved purchasers only. It is up to you to demand this pre-approval process in order to avoid wasting everyone's time – including your own.

The same holds true for buyers who claim to you or your real estate salesperson, "I got cash." You're not selling your home to make everyone happy. You want to spend the least and most efficient time marketing and showing your property to any prospective purchasers, getting the highest value and best terms possible for you and your family. Asking the potential purchaser to provide you (or your real estate salesperson) with a financial validation letter and/or statement as a cash buyer is a very good thing to do. You don't need to see the account number on the bank statement or financial letter. It is the right thing to do for all For Sale By Owners and real estate salespeople. If the cash is hidden in a pillow case or a shoebox, demand they bring it in for you to see. You must think of it this way: _As a property owner, MY time is important, and you are either serious or not about purchasing MY property._

Misconception 4: "What? You're making this much! I had no idea I'd be paying you that much." Real estate salespeople must be raking it in.

This is somewhat of a misconception but also somewhat true. Most attorneys can command anywhere from $150 to $500 per hour when involved in a real estate transaction. Most of the same attorneys are only involved 10 to 20 percent of the time between the property owner and some facets of the property selling process. Not many of these same individuals called my client or me back in an orderly timeframe (within forty-eight hours of the initial phone call) on most of the real estate transactions that I have been involved with.

Even though it is better to go For Sale By Owner when selling a property, some of you will inevitably decide to forego my advice and hire a real estate salesperson. In select cases, a GOOD real estate salesperson who is knowledgeable, successful, and very customer oriented (calls his/her clients back regularly) may not be paid enough in some real estate transactions. Some real estate salespeople dedicate 100 or more hours on some real estate transactions and may make less than $500 ($5 per hour, less than minimum wage, not including salesperson's advertising costs). The lower-priced properties are sometimes the biggest headaches. It is not uncommon to have committed 100 plus hours on other properties (that I believed were good properties), and some of those properties did not sell. If a property does not sell, a real estate salesperson does not make a dime on it. This is a risk unlike any other profession. If a doctor works on a patient and does not find a problem, the doctor still gets paid. If an attorney loses a trial, the attorney still gets paid for their time. If an appraiser appraises your home for a certain value and that home does not sell for the appraised value, the appraiser still gets his fee. In all three of these cases, the client cannot negotiate, and there are fees to be paid, but the same does not hold true for real estate salespeople. So, from this perspective, the thought that real estate salespeople are "raking it in" is a misconception.

Similar to my opinion of attorneys, when it comes to real estate salespeople, there are very few good ones, but the majority of them are not worth a dime. There are many reasons for this, and much of it has to do with the evolution of capabilities of real estate websites, which I will discuss in more detail later on. Many mistakes are made on a regular basis that cost sellers a lot of money, time, and emotions. In most real estate situations, the Internet allows sellers the same capabilities as most real estate salespeople, minus the emotional attachment to the property being sold, of course. If you can find one, a competent and knowledgeable real estate attorney can handle this for you for a lot less of a fee.

Most salespeople today barely know how to take pictures of a property with a digital camera, nevertheless take an actual video and upload it on a website for critical advertising purposes. Most real estate salespeople forget that they are supposed to be working for the seller's best interest 24/7 and not their own.

In today's real estate industry, real estate companies are training their salespeople less, making those same salespeople more of a liability than a future decision maker for potential sellers. The handshake days when you could trust your real estate salesperson to be fully competent in all areas of real estate are over, to put it bluntly. So, in this way, a seller's perception that they are paying their real estate salesperson too much is completely justified. Some real estate salespeople are simply not worth the cost.

Misconception 5: My current real estate salesperson is doing nothing. They promised me the world and told me their company's membership in a large association will help sell my property. When my contract is over, I will hire another real estate salesperson who is a member of that same association, and they will do better.

Almost every real estate salesperson who is a member of a large association with other real estate salespeople advertises the property on similar websites, and the advertisements themselves will be similar as well. If you have a real estate salesperson who is a member of a Multiple Listing Service (MLS) and you terminate them and hire another real estate agency who is also a member of the same MLS, you will see no difference in advertising on MLS websites. You are selling the same house on the same website, and sometimes you will even see the same photos and videos. If you decide to hire a real estate salesperson of the MLS and to terminate and/or change real estate salespeople and agencies (which I don't recommend), hire a NON-MLS real estate salesperson... or better yet, sell your property yourself, For Sale By Owner.

Misconception 6: After reading all of the above mistakes by real estate, I still want to go with a real estate salesperson because I want my house in the MLS system, which is very good for me and my property.

Wake up! MLS in real estate is bad for almost every seller whose property is advertised on some sort of MLS advertisement website. The MLS in real estate is really only good for purchasers who are represented by a buyer broker and real estate salespeople who are new to the industry who do not have any listings to market. Here are some reasons why it is bad for you to have your property advertised in the MLS system:

  * A buyer broker will show the seller's Days On Market (DOM).

  * A buyer broker will show their buyer how many times your price has been adjusted.

  * In most cases, a buyer broker will not show your home to their purchaser at all if your MLS agency is not advertising a higher cooperating fee/percentage.

  * Real estate associates from outside your local area will want to show your property without your listing agent present, even though they know little to nothing about it. A person who knows very little to nothing about your home and your family's needs basically sees you and your family as an obstacle, and they will kick you out of your own property to show it. Really!

  * Your real estate salesperson is not required to be at your property's showing if they have 100 other excuses not to be present. Crazy, but it's true!

  * Almost any real estate salesperson may get the combination to the lockbox entry of your property if you are not present at the property at the time of showing.

  * Even brand new salespeople who know little to nothing can show your property on behalf of your interest. True!

For all of these reasons, my advice to you is DON'T advertise on any MLS real estate website!

Summary

  * As stated previously, real estate is the greatest industry in the world, but it is also the slowest moving in all aspects.

  * Hiring the perfect real estate salesperson is like playing poker in the Las Vegas: you can find one, but the odds are against you.

  * If you do hire a real estate salesperson who meets all of your criteria, they may be worth every dime they will make when selling your property.

  * If you are an emotional person, hire a real estate salesperson to represent your interests when selling a property. Be calm and cool.

  * If you are computer, photo, and video savvy with a good real estate attorney, you have all the qualities you need to sell and market your own property without a real estate salesperson and For Sale By Owner.

  * If you do consider hiring a real estate salesperson, take into account your local real estate salesperson who has the most "SOLD" signs – not the most signs altogether or the prettiest pictures.

  * If you think you know everything about selling a property, remind yourself that you don't. Lose the attitude when dealing with everyone.

  * DON'T hire a real estate salesperson just because they validated your pipe dream price

  * DON'T assume a purchaser who drives a nice vehicle has the dough to purchase your property. For all you know, they might have borrowed the car to make you think just that.

  * DON'T hire a real estate salesperson just because their smiling face is on a lot of signs.

****

### 4B

Real Estate Salesperson Mistakes

If you know the real estate industry well, you would recognize instantly that the "reality" TV industry is very good at pointing out these mistakes to a worldwide viewing audience, and it is somewhat disheartening. On these shows, many mistakes happen on a regular basis (often due to the real estate salesperson's or TV producer's lack of knowledge).

In my humble opinion, not only do these TV shows expose the numerous mistakes by real estate salespeople, but they also reveal almost all the wrong things to do and say when selling a property. My wife likes to surf through the channels at night, and I often catch her watching real estate TV shows. She loves seeing the interior designs of these promoted properties and is always looking for new ideas of how to decorate every room we have in our home. I can honestly say I have not watched any real estate TV show for more than ten minutes. Why? As entertaining as they may be, I simply cannot fathom watching the boneheaded actions of so many real estate salespeople who the public and TV producers perceive as professionals. Nevertheless and in spite of TV hype, _real_ real estate professionals do make mistakes, and these are some examples of the kind they make every day:

**Mistake 1: Disclosing the** D **ays** O **n** M **arket (DOM).** Just as an example, let's say a person who lives in San Francisco has an average DOM of twenty-three days. This same person moves to Saratoga, New York, where the average DOM may be seventy-two days. The purchaser from San Francisco asks, "Why has the property been on the market for so long?"

In this scenario, there is absolutely no likelihood that that buyer will offer full selling price because they instantly perceive there is something wrong with the price or the property because it has been listed "for so long." The fact is that disclosing DOM hurts the sellers. When a potential seller and/or real estate salesperson is asked, "How many days has this property been on the market?" the answer should always be "One day too long!"

**Mistake 2: Disclosing the "Asking Price".** My kids are raised to ask for things, and it is really no different for adult sellers who should command the market price installed on their property after it has been appraised by a licensed appraiser. Oftentimes, the potential buyer will ask, "So, your seller is _asking_ that price, but what does he or she _really_ want to get?" If the potential buyer knows the asking price, they have more tools to bargain with, and they WILL use them. In a case like this, the seller is not going to get a full price offer because the term "asking price" indicates that there is room to negotiate. After all, they are only _asking_ for that price, right? They don't _really_ mean it, do they? To remedy this problem, use the term "offered-at price" instead of "asking price." This is one way to command your value.

**Mistake 3: Open Houses.** To put it simply, open houses are a waste of time and effort. I have seen numerous real estate professional articles and real estate association statistics proving time and time again that almost nine out of ten real estate open houses fail and are a waste of time, so this is not just my humble opinion.

Las Vegas was built on the plight of losers, and while it is a beautiful, exciting city to most people looking in, the losers themselves might think differently. When it comes to real estate, don't become a loser. Put favorable odds on your side when selling a property.

If there is documented failure and waste of time, why, then, do real estate professionals continue to conduct open houses? There are many reasons for this.

It might be that the property is priced too high, so the real estate salesperson needs to put attention on the property to get his/her seller off his back. Sellers are renowned for asking questions like, "Are you really doing anything to market our property? No one has come to view our property as of yet," and with good reason, but this pressure can force a real estate salesperson to hold an open house just to silence the "pushy" seller.

Another reason for holding an open house might be that the real estate salesperson needs to get the price of the property lowered. When an open house fails (and there is a 90 percent chance it will), this is a great tool or excuse to go to the seller and say, "We need to lower the price. I advertised your property, and no one came," or "The people who showed up all said the property is overpriced."

Some open houses are held simply because everyone else is doing it. The practice of holding open houses has been around for over 100 years, so why change? Even in spite of the known failure rate, some real estate professionals have not been trained in more efficient means, so they keep the dinosaurs alive.

Perhaps the real estate salesperson IS efficient with his or her time, but not to the seller's advantage as much as their own. Holding an open house affords them the perfect opportunity to say, "To heck with this stubborn overpriced seller I'm trying to represent. The potential buyers who come to the open house might know someone who needs to sell a house. What's wrong with passing out my cards to a few of the buyers? Maybe I'll land my pretty real estate poster in the front of more yards..." As heinous as it sounds, some real estate salespeople will hold an open house for _you_ simply to farm out new business for themselves among the potential buyers.

And finally, maybe the real estate salesperson chooses to hold an open house as a last-ditch effort because nothing else worked. Why? Usually, because the property is so overpriced. The salesperson was happy to add your listing to his list of listings in the beginning, but now the salesperson is going to desperate means to get it off the list. And open houses are pretty desperate means.

Just as real estate professionals have their reasons for holding open houses, those using For Sale By Owner will also conduct these ill-conceived rendezvous for various reasons. Perhaps they have seen the real estate companies do it, they know no other way to get people to look at their property, they have seen open houses on their favorite "reality" shows time and time again (and magically, on TV, they always prove successful), their friends and relatives tell them it's a good idea, or they notice all the "Open House" signs while they are out driving around, so they assume it is a good way to sell a house. Don't fall prey to this false perception. There are a plethora of reasons why people hold open houses, but there are also plenty of reasons why you shouldn't.

First of all, you must realize that people coming through the door of the open house property have not been financially validated or pre-approved. Your neighbors and others will come through the door just to be nosey, and the more people who come through the doors "just to look at the place," the more time you waste.

In addition to not being pre-approved, some of the visitors might actually be pre-convicted. An open house quite literally opens your house, making it easy pickings for potential criminals to tromp through the door and shop with the five-finger discount at your expense. I have never met one real estate salesperson or owner yet with the ability to watch every movement of three different people going in three different directions within the same property – and thieves know this is an impossible feat.

Open houses are so out-of-date and ineffective that most real estate salespeople do not even know why they last for so long. What is the reason for the two-hour open house? Even the real estate people cannot answer this question. They have seen and been taught that two hours is the _norm,_ yet there is no documented reason, statistics, or validation as to why this time period is being utilized. In any of life's decisions, it is not wise to follow people who do not have an answer themselves for a transaction they created in their own industry. If you choose to ignore the advice here and hold an open house anyway, limit it to one hour. Besides making it more difficult for thieves to perform a heist and wasting less of your time, this will force all your visitors to be there at the same time, and this creates a sense of interest in the property, which will result in an advantage for the seller. If a purchaser _is_ interested and has been keeping an eye on your property, they will make it a point to be at your open house within your one-hour time period.

My advice, quite simply, is to put the odds in your favor by not investing the time and energy it takes to hold an open house, which we already know has a 90 percent failure rate. In spite of what you've seen on TV or what your real estate salesperson tells you, only allow RWA pre-approved, financially validated purchasers into your property by appointment only.

**Mistake 4: Talking Too Much.** The real estate salesperson wants to sell your property and make the big commission. They only get paid if and when they sell the property. Knowing this, real estate salespeople often let their guard down when they are trying to befriend the potential purchaser.

I have heard real estate salespeople state to potential purchasers:

  * "I know you want to put an offer in at this price, but my seller's won't accept that."

  * "My sellers are having personal and/or financial problems."

  * "We don't work with other real estate companies because they won't pay us a bigger co-broke." (A co-broke is an agreement between two brokerage firms to share a listing and the commission of that listing upon the seller and purchaser agreeing to all terms of a property sale.)

  * "I know this property is overpriced, buy my seller will entertain all offers."

  * "This property has been on the market too long."

  * "I know the house needs some TLC, but put an offer in."

  * "The other real estate brokers are not a member of a Multiple Listing Service (MLS), and we are better than them."

  * "I don't know what type of roof covering, furnace, or hot water heater this home has, but feel free to look around." (Not knowing the property's general mechanical aspects.)

  * "If you don't like this property, I have many more to chose from."

  * "I can't by law tell you the price my seller will accept, but the real price my sellers will accept is within a couple thousand of this number... wink, wink."

Every single one of the above statements is bad news if you are trying to sell your home through a real estate salesperson; but believe it or not, real estate salespeople somewhere maybe uttering these statements to potential buyers every day. Hopefully, your real estate salesperson is not one of them.

If and when the property is priced right with good timing, along with a very good real estate salesperson working on behalf of your interests, your property will sell at or near the price you are striving for. The days of escorting people with frivolous statements and "selling ice to Eskimos" are over. You do not benefit from a real estate salesperson who talks too much. A good real estate salesperson will not talk too much, but will be informative with all aspects of the property and let the property sell itself if the price is right.

**Mistake 5: Walking into the Same Room with a** R **eady,** W **illing, and** A **ble (RWA) Purchaser.** There is not one RWA purchaser out there who wakes up and says, "I want a small property with small rooms." When you are showing your property to a purchaser, do not walk into the same room with the purchaser. If you walk into the same room with the purchaser (especially if you are standing right next to them in the middle of the room), you will add "clutter" to the room, and the room will feel smaller. This _small feel_ is not what any purchaser strives for when looking for a home that meets their needs. The TV shows highlight this mistake by real estate salespeople, continually walking into the same room as the purchaser on a regular basis. Unfortunately, almost 99.9 percent of real estate salespeople and For Sale By Owners make this mistake every day when showing a property. Why are you walking into the same room as the purchasers at the same time? Did you forget the room's features?

Let's get this right. The real estate salesperson (who has walked through the property numerous times to familiarize themselves with it) brings a purchaser through the property. While leading the purchaser into the rooms of a property, the real estate salesperson is standing in the same room. But why?

This may seem like a small, insignificant misstep, but in reality, it causes problems. Sellers need every advantage they can get, and walking into a room or being next to a purchaser inside a room is not an advantage for the seller. For one thing, the room will instantly feel smaller with more people in it. Another misconception might be that the salesperson has forgotten what the room looks like and needs to look at it again. It might even be insulting to the potential purchasers, who do not really need help looking at a room. It is a bad idea all around and should be avoided for all showings

The right and proper way to show and/or explain a room's features is to stand in the doorway while the purchaser walks into the room. Stay out of the room and stand in the doorway, unless the room is so big you have to yell to the purchaser. I trained my real estate salespeople to never go into the room with the purchaser unless the room was way above average size. All of my salespeople were to stand in the doorway and explain any prominent features of the room that may need to be emphasized beyond normal viewing. This prevented the room from being made to feel smaller and the purchaser from feeling confined or pressured to rush. In essence, it allowed the room to have a warm and fuzzy feel with no intruders in the way.

**Mistake 6: Not Knowing about the Listed Property**. The real estate salesperson is supposed to be a professional. A vital skill that many real estate salespeople miss is actually knowing the many aspects of a property they listed. This is yet another issue that would make me a rich man if I had a penny for every time I heard about it.

Though it isn't the case with all real estate salespeople (thank goodness), many do not feel it is important to know the general or mechanical aspects of a property they are trying to sell. Your real estate professional should be able to answer all of the following questions, because potential buyers WILL ask them.

General Questions:

  * What high school, middle school, and elementary school district is the property located in?

  * What is the tax dollar value of the district? How many dollars per $1,000 is the tax base here?

  * Where are the nearest shopping centers and stores, post office, food outlets, and churches?

  * Is there public transportation of some sort or a taxi service available in this area?

  * Where are some of the closest recreation places?

Mechanical Questions:

  * How old is the roof covering?

  * When was the last time the furnace was cleaned?

  * How much insulation (r-value) is in the attic and walls?

  * How many gallons is the hot water heater rated for?

  * What type and size of septic tank does this property have, if applicable? How many feet of leach field does it have?

  * What type and how deep is the well, if applicable? Does it have a UV light system?

A knowledgeable real estate salesperson is _always_ better than a real estate salesperson that is not knowledgeable. They have a duty to their client to know the property they are listing and to be able to answer these and any other questions about the property. Your real estate salesperson must know your property inside and out!

**Mistake 7: Not Becoming Computer, Camera, Photo/Video, or Communications Technology Literate.** This statement relates to many of our elder real estate salespeople and a few younger real estate salespeople who are "scared" of the computer generation, afraid of the new technologies that many of today's electronics offer. Almost every person has the capability to understand and utilize computers and the many other technology tidbits (cameras and video recorders) that can and should be utilized in the real estate industry on a regular basis. Great pictures can make a property really stand out. Great (or even good) videos of a property with a household video camera can really save a lot of money, time, and effort for all parties. There are so many free websites that allow videos for promotion, so why not utilize them for your property? If your real estate salesperson does not have the capability to take a high quality picture (and keep the pictures updated through the seasons) and video of your property, move on to the next real estate salesperson for your interview. A real estate salesperson who is technologically up-to-date will serve you and your property well.

Regular communication (at least one conversation within a ten-day period) is utterly important. Landline and mobile phones work great and have been around for a long time. This method is very personal and is also an easier method to understand your client's emotions one way or another concerning a question or concern. However, can you document the torts of the phone call? Not really. It will always be the seller's word vs. the real estate salespersons.

Due to modern busy schedules, most real estate salespeople should and do communicate with their clients via email to clarify any concerns the seller may have. While communicating via phone is good and personal, communicating via email allows for a documented record of what was said and when, so using email to solidify and clarify the phone calls is always a good idea. When you are able to use technology such as computers, AV equipment, websites, and email, you and your client will have a better, more efficient selling experience.

**Mistake 8: Complaints about Clients on Real Estate Websites.** The Internet has opened up a whole world of social networking opportunities for likeminded people to get together, and websites for real estate forums are no exception. To find these forums, all you have to do is type in "real estate agent forums." (I refuse to list them here, as I think too many of them serve only a negative purpose to the industry, the salespeople, and the sellers themselves.) The problem with these forums is that they provide a very public place for real estate professionals to whine, cry, and complain about their real estate problems and their clients' lack of knowledge – not to mention whatever else there is to complain about or blame someone for. If your potential real estate salesperson is a member of one of these websites (just ask them in the interview process), it is advisable to move on to one who isn't.

While the real estate salesperson will try to promote this action as "networking" that might help you sell your property, don't believe it. There are many reasons why you should immediately terminate a real estate salesperson from consideration if they are a member of one of these so-called real estate "networking" forums:

  * If you witness a doctor or an attorney asking very personal questions or complaining about their clients or professional situation, would you hire them?

  * If your real estate salesperson has to go to a real estate forum to try to get answers, how good is the real estate brokerage and broker within that same firm who is supposed to be training them?

  * Most of these same real estate forums also allow For Sale By Owners and any other member of the public to view these same complaints. Is a potential purchaser viewing a post about your real estate transaction?

  * If your salesperson is a member of these forums, couldn't that same real estate salesperson be better spending your time and money by communicating directly with you about marketing your property the right way?

  * Do doctors and attorneys have public forums that allow them to whine and complain about their clients?

  * These same forums have topics where real estate professionals bash one another. Do you really want to work with someone who has such a loose Code of Ethics or none at all?

  * In all likelihood, some real estate salespeople will use these forums to bash the very association they used as an advertisement to reel you in to hiring them. Again, do you really want to work with someone so unethical?

  * Is it valuable to work with someone who is claiming he/she wants to help you sell your property but is saying bad things about you and your property in a public forum?

Again, if your real estate professional is a true professional and worth your time and money, they will know better than to bash you, your property, their colleagues, or their association in a public complaint forum, and they will not have to scour the Internet for answers their training should have already taught them.

**Mistake 9: Failing to Properly, Legally, and Completely Fill Out Legal Documents such as Contracts and Addenda.** My experiences in relation to other real estate people filling out a legal document have made me very frustrated. Many times I have wondered, " _What am I doing in this profession?"_ When terms have been agreed to by the seller and purchaser, all agreeing parties are to provide these agreed terms, disclosures, and addenda in writing to make them legally binding. Once these terms have been written down and authorized with signatures and dates from competent, legal adults, hard copies of the documents have to be faxed, mailed, or hand-delivered to the attorney's office for review, clarification, modifications, acceptance, and/or rejection. A real estate salesperson cannot draw up or compose any legal documents or terms since the real estate salesperson cannot practice _law._ In other words, the contract and documents you have signed are not really binding until the attorneys that represent both the purchaser and the seller review and approve all aspects of the legal documents.

Most real estate salespeople are not filling out all of the pertinent documents correctly. This is STILL happening every day in real estate, even though attorneys are supposedly reviewing the documents in their entirety. But here is the quiet truth about the attorneys: if a mistake is made in the paperwork, the attorney can either fix that mistake within a certain immediate timeframe or wait and see if the deal goes through smoothly and pick and choose to utilize that mistake to get his/her client out of the deal. In simple terms, if there is a mistake, the attorney can utilize that mistake later on in the same deal to get out of the contract. Therefore, the deal is dead. Do you see the importance of error-free contracts? Imagine getting up to a day before _closing_ and your real estate salesperson receives a fax notifying them of the contract mistake and a cancellation of the tentative closing – not to mention there is likely a P.S. demanding that the deposit be returned as soon as possible.

_Closing_ _\- The time when the purchaser accepts title of the property and the seller has been compensated for this same action of transferring the title to the purchaser. From the seller's perspective, closing represents getting paid._

When it comes to legal document mistakes, below are some of the most common that real estate salespeople make that may jeopardize the client:

  * Signing their name as the broker. (For example, signing on the "Listing Broker Authorization" line as "Mary Jo Smith, Real Estate Salesperson.") This is not only incorrect, but also considered fraudulent!

  * Abbreviating names and words in a contract. Unless it is specified in the contract, abbreviations are not legal.

  * Not filling in all the blanks on a contract. These are there for a reason, and if they do not apply, a line should be drawn through them or an "NA" indicating that they are not applicable. No blanks should be left blank!

  * Dates are not consistent or are not written correctly. (For example, writing "10 days" instead of "December 1, 2010.")

  * Incorrect, vague, or unclear attorney information. (For example, writing "Seller's Attorney" instead of "Attorney Chris December.")

  * Incorrect, vague, or unclear bank information. (For example, writing "Buyer's Bank" instead of "National Bank of XYZ Incorporated.")

  * Wrong or inadequate addenda information. Every addenda and disclosure has a title. The FULL title needs to be included with the primary contract, or they will be considered separate contracts.

  * Not faxing the paperwork and all of the parties' information within the time period allowed for revisions and rejections.

**Mistake 10: Not Replacing or Removing the "For Sale" Sign When it has been Knocked Over or the Listing has Expired.** Can you spell

L-A-Z-Y? I will bet that you have gone to a garage sale or two and seen a person using a leftover real estate sign as a "Garage Sale" sign because the real estate salesperson never came back to get it after the listing expired. Either that, or there is a real estate sign still sitting against the house that was listed, and the real estate salesperson never came to pick it up for fear of being embarrassed for failing to sell the property as they had promised initially.

If the property is actually still for sale, the sign does no good if it's sprawled out on the grass. After a while, a "For Sale" sign inevitably will be knocked over by wind, passersby, a lawnmower, or something else. You would think the real estate salesperson hired by the seller would be keeping an eye on the property and would make an effort to pick up the sign or replace it, but rarely does this happen. Sadly, real estate salespeople are just plain lazy when this happens to their client's sign, and while it seems like a small thing, a house won't sell if no one can see the sign from the street.

**Mistake 11: Discouraging Potential Purchasers from making a "Too-Low" Offer on a Property, based on the Real Estate Salesperson's Opinion.** This action happens regularly, even though it is an illegal action which the real estate salesperson should not do at any time. Most clients of the real estate salesperson do not even know this has happened or is happening. By law, every real estate salesperson is supposed to _draw up_ ALL offers by ALL potential purchasers and present the offers to their client, the seller. Illegal or not, most real estate salespeople discourage purchasers from getting an offer to the seller if the offer is not an offer the real estate salesperson is not satisfied with.

_Draw up -_ _To gather all of the legal documents pertaining to presenting a legal and binding offer to the authorized seller of the property the purchaser is interested in. The real estate salesperson integrates all of the purchaser's terms on the provided legal documents for the real estate salesperson's presentation of purchaser's terms to the seller for acceptance and/or rejection and/or modification to the purchaser's terms._

For the sake of an example, let's say a seller lists their property with a real estate salesperson for the amount of $100,000. A buyer views the above property and wants to have the real estate salesperson draw up an offer based on the purchaser's terms to be presented to the seller by the real estate salesperson. The buyer wants to start with a low offer of $70,000 with applicable terms to the seller, but the real estate salesperson states, "There is no way my seller will accept that, so I simply cannot draw up such a low offer."

So, what happens next? The potential buyer becomes so insulted and angry that they walk out in frustration, and neither the real estate salesperson nor the seller ever hears from them again. In essence, by refusing to even acknowledge or attempt the offer, the real estate salesperson has burned a bridge that could have proven beneficial to their client.

We must remember that it is a natural human instinct – right or wrong – for every purchaser to initially try to _low-ball_ their first offer to the seller to see if the seller budges a lot or does not budge at all in their terms associated with their real estate property.

_Low-ball_ _\- A purchaser offers monetary terms to the seller that are advertently very different from the monetary amount the seller is seeking or expecting._

Considering that we all want to get the best price on anything we buy, this type of "heckling" for lower prices by the purchaser is common and to be expected, particularly in difficult economic times. Most purchasers' game plan is to offer a low price initially to the seller and to counter with more appropriate terms if and when the seller does not modify their terms on a counter-offer back to the purchaser. All offers from a purchaser must start at a number. Either the starting number on the first offer from the purchaser will be close to the seller's marketed price on their property, or the initial offer from the purchaser will be a low-ball offer to the seller. Sellers need to remove all emotions and accept the actions in relation to offers from purchasers. Chances are, if the sellers were in the business of buying a property themselves, they would do the very same thing.

On a low-ball offer, sellers need to realize that an offer has come in on their property and that offers need to start somewhere. The seller always has the choice to accept or reject or counter the purchaser's offer to meet their acceptable terms. Even though the initial offer may have been too low, a meeting of the minds can still be attained, as long as the real estate salesperson has not made the tragic mistake of refusing to draw up an offer that a purchaser has made simply because they deem it to be too low.

**Mistake 12: "Go on in and make yourself at home."** I have seen many real estate salespersons do this unspeakable act during open houses and showings. Never under any circumstances should a real estate salesperson be so naïve as to unlock their seller's property and say to the potential buyer, "Go on in and have a look, then come on out and tell me what you think of it. I will be waiting outside for you."

A real estate salesperson would have to be certifiably insane to allow tentative buyers into a property without a chaperone. Many people will go to great lengths to disguise themselves as purchasers and are not pre-approved. We have already mentioned that open houses are a free-for-all for criminals, but how much more so would it be if the criminals were invited to step in unattended? When a real estate salesperson is hired by a client, they have a fiduciary duty to represent that client's interest at all times. Beyond the risk of theft or damage, their absence also eliminates the opportunity for them to answer questions about the mechanics, cosmetics, or other features of the property.

Allowing this to happen would be a lazy, very unprofessional, and quite possibly illegal act (because it is a breach of fiduciary duty). If as a seller you discover that your real estate salesperson is performing showings and open houses in this naïve, irresponsible way, you have grounds to terminate your contract with them because they are not fulfilling their fiduciary duty to you as your agent.

Summary

  * In my opinion, you have about as much of a chance of hiring a knowledgeable and all-around competent real estate salesperson as you do of winning your state lotto.

  * As stated prior, if you are computer, AV, and Internet literate and already have a good real estate attorney, save the big real estate commission and do it yourself.

  * Try to sell your property For Sale By Owner FIRST and to exhaust all real estate parameters before you even _think_ about listing your property with a real estate associate.

DON'T blame me if you list with a real estate agency and one or more of the above mistakes by a real estate salesperson negatively affects you and your property or the sale of it. I'd hate to have to say, "I told you so!"

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Chapter 5

Those Darn TV Shows

Ten minutes is all I can stand watching any real estate show before I tell my wife, "Please change the channel." I have never been able to stomach any real estate show or the way they promote all aspects of selling and/or buying a property. To see TV shows purport the simplicity (due to time constraints) of selling or buying a property along with unknowingly glorifying the omissions and mistakes of the real estate sale is a travesty to most people who dream of owning a property or selling a valuable and personal investment. To me, a real estate property is one of the biggest – if not THE biggest – emotional and financial asset a person will ever invest in or sell, and it is NOT done within thirty minutes with a few commercial interruptions.

Even still, some of the real estate television programs do offer some benefits:

  * They do show you what _not_ to do in a real estate transaction.

Interior/exterior design and decoration ideas are plentiful.

  * The shows do exhibit how to avoid investing your money in bad ideas for low financial returns.

  * The shows will teach you that real estate salespeople will settle for a lower fee in some cases.

  * As discussed previously, real estate TV shows will show you firsthand the common mistakes that real estate salespeople make every day. If you are a seller or a buyer, this is valuable knowledge that can alleviate problems before they start – or maybe will even prevent you from hiring anyone in the first place, thus saving you a big commission fee.

Summary

  * Remember that just like most "reality" shows, real estate TV is often far from reality.

  * If you insist on watching these shows because the handyman is cute or the interior decorator is always bickering with the host or because you want to learn fascinating new ways to decorate your walls, that's fine; but always be sure you are watching them as entertainment and not for a quick how-to course on selling or buying a property.

If you are interested in becoming a real estate professional, DON'T use real estate TV as a starting point for your training.

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Chapter 6

Do You Need a Real Estate Attorney?

Beyond being the butt of too many jokes, attorneys can best be defined as legal representatives. Many people do not enjoy the process of utilizing any type of attorney. Generally speaking, no one ever needs an attorney when something positive is going on in their life. Whether it is divorce, bankruptcy, or your neighbor vandalizing your mailbox, attorneys always seem to be called only when there is a problem to be solved. But sometimes, attorneys are helpful at protecting your interest and being sure that everything is on the legal up-and-up so no one gets the short end of the deal under the realm of the law we all share. Real estate is just such an occasion.

Selling and/or buying a piece of real estate can represent a sizable financial transaction and an emotionally trying time for the majority of us out there. There are legal documents that need to be filled out correctly and filed within your local county offices, along with financial information that has to be calculated to the penny.

When you are selling a property, it is highly recommended by many real estate salespeople and other professionals that you hire a knowledgeable and experienced REAL ESTATE attorney.

Even if you are unsure if you want attorney representation at all, make an appointment with a real estate attorney that allows a free consultation. When you go to this appointment, bring a notepad with all questions about the real estate selling process that you may have. Once the free consultation is completed, think about all the answers your attorney has provided you before you make the decision as to whether or not you want to utilize an attorney for representation when selling your property.

The biggest pet peeve among the public concerning attorneys is that they do not respond promptly to phone calls from their clients. A reasonable timeframe for a return phone call is forty-eight hours. The majority of people _think_ they are the only client the attorney has. Most law firms have an abundance of clientele, and the client (you, the seller) needs to understand this. On the other hand, many law firms initially promise the world just to get the person signed as a client and then do not or cannot spend enough time with the client.

Remember that if you sign with an attorney, they work for you. They represent you in entirety. If you are not satisfied with them at any time, feel free to terminate them and the law firm they work for. If you allow your attorney to delay responses to you for a long time, the communication and your confidence in them will only get worse as your real estate deal progresses. Attorneys put their pants on one leg at a time just like you. Your small real estate deal is just as important as a large real estate deal. Regardless of your scenario, you are just as important as any other clients they have. Command respect from your attorney, and they will respond appropriately to your real estate needs throughout your attorney-client relationship.

If your local attorney only specializes in bankruptcy, divorce, speeding tickets, etc., then you need to look elsewhere to hire another attorney who specializes in real estate. You wouldn't hire an eye doctor to fix your teeth just because they are listed under the "Doctor" category in the Yellow Pages, and you shouldn't hire just anyone in the "Attorney" section to handle your real estate issues. Hire a good attorney who specializes in real estate, is knowledgeable, and has a reputation for maintaining a good flow of attorney-client communication, and you will be serving your property sale well.

Summary

  * It is highly suggested to schedule a free consultation with an attorney BEFORE you start selling your property to see if utilizing an attorney is right for you.

  * If you do hire a real estate attorney and they do not return your phone calls within a forty-eight-hour timeframe, feel free to terminate them, for they are not holding up their end of the bargain. It will only get worse as your transaction moves along.

DON'T try to practice law or think you know everything there is about real estate. Leave that to the professionals.

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Chapter 7

How and Where to Market Your Property

Okay, so you just watched your favorite TV show, consulted with a real estate attorney, and said, "Honey, we can save a lot of money and sell our property ourselves." The decision has been made, but where and how do you promote your property? What will be most effective, efficient way, the way that gives you the most bang for your buck? Most people who own a property assume the best way to start is to go to the local hardware store for a "For Sale" sign and post the property on a random real estate website. While these are the most common approaches, they do not work for the majority of sellers out there.

Your first and foremost goal is to bring the most positive attention to your property while your property is on the market. Work toward elevating the attention it deserves above all other similar properties that are for sale around you and your neighborhood. How is your property going to stand out from the rest? How can you get the most potential purchasers to your property for a viewing? You need to get the most amount of potential buyers looking at your property within the shortest amount of time, and that is the only way to guarantee you can make that second trip to the hardware store – this time for the "SOLD" sign. So, how and where do you sell your property in order to receive the most exposure while trying to achieve the highest net value on the sale? This chapter will give you some good places to start.

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### 7A

Signs, signs, everywhere there are signs!

The number one tool in selling real estate is a sign that states "House for Sale" or "Property for Sale." It is highly recommended that all properties that are to be sold have a clear, visible sign out front. Some people are a bit hesitant to do this for a variety of reasons. They say, "Then the neighbors will know" or "Do we have to?" or "What will our family think?" If you have made the decision to sell your property, you must only be concerned with the opinions and persons who are currently paying for that same property- YOU! Don't worry about the neighbors, family, or friends.

Before you install a "For Sale" sign on your property, make sure you are not violating any association or local rules. Before you make the trip to the sign store, take a ride around your property and see if there are numerous places near your property that can direct vehicles to your property. If you can only install one sign on your property, do so. If you can install one sign on your property and two more "For Sale" signs with directional arrows on a nearby road pointing to your property, just do it! The more signs directing people to your property, the better. Be sure to check with your county offices and follow all applicable ordinances in your area.

If your original "For Sale" sign does not have enough room, install a secondary sign rider with your phone number for people to contact you. If you have a cell phone number, utilize this number instead of your current phone number, as most cell phones offer voicemail and will allow you to screen your calls. If the person calling is truly serious about your property, they will leave a voicemail, and you can return their call. Your cell phone makes for a good administrative assistant or receptionist in that it will allow you to screen your calls and weed out the serious potential buyers from the wishy-washy or nosey types who would only waste everyone's time.

If you do not own a cell phone and you must utilize your home phone, it is imperative that you have an answering machine for the same screening purposes. However, be warned that if you post your landline home number on your signs and your number is not purposely unlisted, real estate salespeople and others can and will do a reverse directory search on the Internet or through other sources, and you will then start receiving junk mail from real estate salespeople and others promising you the world. Save some trees from the junk mail pile and use your cell phone number when selling your property.

Being that your sign on your front yard is your business billboard and time is money, on your "For Sale" sign, install riders that are applicable to your property. Do not be afraid to install as many secondary rider signs on top of your already existing "For Sale" sign as you need. Some sign riders might include your phone number, the number of bedrooms, the number of acres on the property, whether or not it is a commercial or lakefront property, and an offered-at price (NEVER post an "asking price" for reasons previously discussed.)

An average sized real estate salesperson sign is 18 x 24 inches, and an average sized secondary rider for your main sign is 6 x 24 inches. Both are made of galvanized metal with a black metal frame, so they are sturdy and durable.

There are a lot of tricks of the trade when it comes to posting your "For Sale" signs, and many of these can prove beneficial. Besides using sturdy signs with ample sign riders, keep these things in mind.

**Nail Polish.** Use black, red, or any other dark color of nail polish (be careful when raiding your wife's stash!) to paint your number(s) down on your secondary signs. Nail polish is waterproof and will hold up to the weather, but if you need to remove it or make changes, it is easily an inexpensively removed with nail polish remover.

**Reduced Pricing.** If your property offered-at price has to be adjusted to a lower price, DO NOT install a "REDUCED" sign for any reason. If your property was originally priced at $200,000 and is to be adjusted to $178,000, do you really think that installing a "REDUCED" sign will allow you to receive the full purchase price of $178,000? Not a chance! Purchasers view a "REDUCED" sign as a symbol of desperation, and they will assume that either the property or the sellers have some sort of problems to contend with if the price has been reduced. When you see an item on a clearance rack at the store, you immediately determine that it has some sort of blemish or was not purchased by others for some reason, and home buyers will assume the same about a property that is "on the clearance rack." What about the new purchasers who did not see your original price prior to the adjusted price? If the new purchasers see the "REDUCED" price immediately, it may turn them off your property even before their interest begins. Installing a "REDUCED" sign is suicide when it comes to selling a home, preventing you from getting the offers that you deserve. The offers you do get will be quite lower than your new reduced price, at least in my experience. If the price has to be adjusted for any reason, simply change the price on the sign – nothing more and nothing less. You don't need to display any explanations for pricing changes.

**Posting Offered-at Pricing.** Should you promote the offered-at price of your property on your sign? Yes, if for no other reason than saving yourself from the 100 phone calls asking, "How much is your property?" Posting the offered-at price will enable you to save time (which is money, as we know) as well as weed out purchasers who cannot afford the price range.

**Signs You Should NEVER Use.** There are signs you should NEVER use when trying to sell your property. These signs will do more harm than good. Avoid using the following:

  * REDUCED

  * OPEN HOUSE

  * NEW PRICE (What was wrong with the old price?)

  * ASKING $____________ (This sign states, "I am really not serious about my current price.")

  * TURN TO THIS RADIO STATION TO HEAR VARIABLES ABOUT HIS PROPERTY. (What's next, "See the cartoon show I drew with my property in it"?)

Summary

  * Install the proper sign with secondary riders and be sure to follow local laws when installing signs on or around your property.

  * DON'T install any sign that will give the purchaser a negative idea toward the property, the price, or you.

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### 7B

Pictures and Videos

A second important feature to utilize as a marketing tool is a good front photo of your property. The first view of your property is the most important. When taking a photo of the front of your property, take it at an angle, slightly to the side, and not directly in the front center. If you take it directly from front center, your house will look like nothing more than a square box when uploaded on a computer screen, and this is something you should avoid. Taking the photo at an angle will make the house visually larger with more appeal. If the front of your property is not its best side, use your discretion and pick the best side of your house to post for public view.

Uploading interior and exterior photos on a computer from a digital camera is a positive step toward selling your property. The more updated photos uploaded on the Internet, the better. Unless your bathroom is very different in size or elegance than the average bathroom, skip uploading the bathroom picture. When taking photos, try to be sure to include these specific areas:

  * Kitchen

  * Living room

  * Master bedroom

  * Family room

  * Basement

  * Interior garage (if clean)

  * Exterior front

  * Exterior side

  * Landscaping

  * Exterior garage

  * Pool

DON'T take photos that include people (adults or children), pets, guns, illegal items, trash, or anything a purchaser might find offensive or off putting.

A third important tool to utilize in promoting your property is a video camera with a memory card or other device that allows transfer of video to a computer. Utilizing a video camera to make a video of the interior and exterior of your property will save you a lot of time with potential purchasers and even more time when scheduling appointments pertaining to showing your property. Video is the newest and best way to promote a property on the Internet. Allowing purchasers to view your property within the confines of their own residence is a very good thing. Why? Simply because the purchaser is relaxed and not pressured. The purchaser can view the video twenty-four hours a day at their convenience. If you are promoting your property with a video, make sure each and every potential purchaser who inquires about your property actually views your video BEFORE you schedule a showing with that same purchaser.

Purchasers can forward the property video to friends and family, and this can generate positive feedback that may convince them to take a deeper look at your property. If a purchaser does not like certain features of your property, you have not invested or wasted any time in their lives or your own by trying to schedule the showing appointment. Efficiency will occur on both ends, and both the potential buyer and you as the seller will appreciate it.

We live in the technical age and need to bring many aspects of the real estate industry forward into technology. If you are not using video to promote your property on the Internet, you are missing out and not providing the attention your property deserves. A video saves time for everyone involved in selling or purchasing a property.

Most people can go to their local electronics chain store and pick up a decent video camera with a memory card at a very reasonable price that pales in comparisons to the thousands you stand to make. You will need to make this small investment to get the price you desire, and the video camera can be used for other things as well – like making family videos at the holidays. The biggest fear to overcome is the obvious: you are not a professional video camera person, but don't worry about it! There are entire Internet websites out there that have made millions posting amateur videos, and they are fun for everyone. If eight-year-olds can master YouTube in the manner that they have, you can certainly post a video of your property online.

While taking a video of your property, follow these simple steps:

  * Go slow with the camera. If you move the camera around too quickly, it will create a blurry video.

  * Don't talk too much in describing the property, if at all. Let the video speak for itself.

  * Make sure to spend enough time videotaping each room so that your viewers get the full effect of what your property has to offer.

  * Don't stumble or trip over something while videoing your property! In addition to making a bumpy video and risking a sprained ankle, this can make your property look cluttered and messy, indicating that it isn't spacious enough.

  * Be sure not to take any video of people (adults or children), pets, guns, illegal items, trash, or anything the viewer might deem offensive or off putting.

When you are done videoing the property, transfer the video onto a CD-ROM. Make at least two copies of the CD, one of which should be kept in a secure place. This video of your property can be utilized for your insurance company should you ever need to provide evidence of the items in your property and the condition of your property, so it is something good to have even beyond selling your property.

Lastly, the most important tool when selling a property is also considered the simplest to utilize – and everyone already has one. This tool is your mouth. Word-of-mouth combined with proper communication to others can work wonders for anything you are trying to promote, whether it be a political cause, your favorite restaurant, or yes... even selling your house. In everyday casual conversation, do not be afraid to promote your product to the people you encounter. Don't be afraid to include a short "sales pitch" to your peers. Who knows? They may actually be the person who turns you on to the purchaser you are seeking – or maybe they'll even buy the property themselves! The key is to keep it casual and simple, not overdoing it to the point of annoying people. Feel free to be your own agent, but remember that nobody likes pushy salespeople.

Summary

  * Make an investment in a good digital camera that has the capability to take JPEG file photos with video captioning.

  * Promote your property on as many real estate websites as meet your needs and criteria.

  * Don't miss out on promoting your property the best possible way. Pictures combined with video promotions of your property are the best advertisement.

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### 7C

Promoting your Property on Real Estate Websites and in Newspapers

Now that you've got those wonderful digital photos and videos, where exactly do you put them? Your answer is the World Wide Web – the "information superhighway" we know as the Internet. There are thousands of real estate websites that promote properties to the public. Some offer both real estate salesperson and For Sale By Owner properties, while others are specifically geared toward one or the other of these types of sellers.

In searching for the best website to meet your needs, make sure the website you choose has photo and video capability. Another important asset in a real estate website is the ability of the website to stop the unwelcome spamming you may receive from fictitious purchasers. These types of responses may actually turn out to be solicitors of other products you did not approve of. If your property is a lakefront property, you may want to promote your property on websites that specifically cater to those or other specified categories. On the majority of these real estate websites, you can promote your property for free. It may seem strange that you can advertise your property for free, but rest assured the administrators of the website are recouping their investments (and then some) from the paid advertisers who advertise on their site. Don't be afraid to promote your property on many websites. The more, the merrier, as long as these real estate websites meet your real estate interests.

Should you pay to be included on a real estate website that caters to your property and offers photo and video posting? If you feel this website is the right real estate website for you and paying a fee for your property to be promoted on this website benefits you and your property, the answer is yes. Your decisions have to fit your needs in all aspects of the selling process. The real estate website that is right for you and your property really depends on what real estate website _you_ feel and believe is right for you. It's up to you.

Newspapers have been around a long time, and believe it or not, even in this so-called "paperless" age, there are consumers who still carry a regular newspaper subscription. There are still paperboys in the world! Some newspapers promote their own real estate magazine on regular monthly, weekly, or weekend specials basis. Promoting your property in your local newspaper real estate section and/or magazine is another great marketing tool for your property. Advertising in newspapers still works, and people still enjoy picking up an actual tangible, hard copy of a newspaper to look for property for sale. Even though newspapers cannot provide video capability and very few provide photo opportunity, your local newspapers can include your property promotion alongside the real estate salespeople' properties in the way your property needs to fit in. Newspapers can customize a specific promotion for you. Give your local newspaper a chance, and it may work.

What newspaper promotions really do not work? The large one-day ads are a waste of time and money. They are often very costly and are listed for much too short a time period for you to effectively promote your property.

Another factor to consider is that many newspapers nowadays are linked to their own newspaper websites, so the classified or real estate ads you place might also appear online on the newspapers website. This is some additional promotion that definitely does not hurt.

Summary

  * Promote your property on as many real estate websites as you can find that meet your needs and criteria.

  * DON'T think a "For Sale" sign is the only way to go when promoting your property to the public.

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### 7D

Where and What Does NOT Work in Promoting your Property

We have talked about many of the right ways to promote your property, but what are the wrong ways? What things should you avoid when trying to sell your property?

**Large, One-Day Newspaper Ads.** We have already mentioned this above, but just to reiterate, you should stay with consistent small ads that are cost effective and run for a longer period of time. Line ads also work fine and are cheaper to purchase.

**Pamphlets Placed with your "For Sale" Sign.** The information pamphlet in a tube or clear box attached to your "For Sale" sign simply does not work. To this day, this is one of the biggest wastes of dollars and time when it comes to selling real estate. In most cases, the first ten people who will take one of these pamphlets that you went to the time and expense of creating will be your neighbors and any nosey people from your area. If a person is truly a serious purchaser, they will want to speak with you directly regarding the pertinent variables of your property. Save the $19.95 and the time involved with the info tube.

**Radio Announcements.** Have you ever driven by a property and seen "Tune your radio to 104.3 to hear details about this property" or some such ad? This advertisement method really pertains to real estate salespersons and not as often to For Sale By Owners. That said, I will simply say this is a very wasteful method that does not work. Few people will tune in, and the ones that do will probably not be paying attention. Who would tune into a radio commercial on purpose when we spend so much effort trying to ignore the ones we're already forced to listen to?

Summary

  * Promote your property with methods that are an efficient use of both your time and your money.

  * Just because professionals and everyone else is doing it, that does not make it right for you to continue the wrong actions of others, and open houses are a prime example.

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Chapter 8

Who's Calling You?

Now that you are promoting your property in the proper advertisement areas, whose calling you to inquire about your property? In this chapter, we will go over most of the typical people that will be calling you.

The Lawsuit Person

This person contacts the seller about their property and states either before or after the initial showing the following statement, "I have a lawsuit going and am about to get a big lump sum settlement. I should receive the settlement pretty soon. In the meantime, since I really like your house, can I move in and either pay you rent, or you can hold the mortgage until I receive my settlement? When I receive the settlement, I will pay you off... really!"

If you receive a call from this alleged soon-to-be-wealthy person, your immediate response should be, "Why don't you wait until you receive your settlement and then contact me again? I will be more than happy to work with you after your settlement has been validated if you are still interested in buying my property."

The "Rent to Me" Person

This person says, "I see your property has been on the market for a while. How about renting it to me until my credit situation improves?"

If you receive a call like this, the best answer would be, "I appreciate your interest in my property, but it would be better for both of us if you contact me after your credit situation improves."

The Real Estate Salesperson with an Eager Buyer

The real estate salesperson calls the seller and states, "I have a purchaser who is interested in your property and really seems to like it. Will you list with me so I can bring the purchaser in and get paid?" This statement seems believable because this person is presumably a professional, but be aware that it is one of many lures that a real estate salesperson will utilize to try to have you list your property with them. Remember, real estate salespeople need to List to Exist.

If you want to work with a real estate salesperson, you can answer, "I have no problem working or signing with you. I will sign a one-day listing contract."

If you do NOT want to work with the real estate salesperson, simply say, "I appreciate your client's interest in my property, but I'd rather not work with a real estate salesperson at this time. If your purchaser is interested in my property, I would have no problem working with them once they provide me with financial approval to validate their capability to purchase."

The Interested Purchaser

This person states to the seller, "I have seen a picture, video, or real estate sign on your property and am _interested_ in taking a look at it to see if it meets my needs."

This person may very well be interested in your property, so you should answer them very carefully. You can say, "I appreciate your interest and have no problem working with you, but I will need a pre-approval from a financial institution in order to validate your ability to purchase my property. I know you will want to move quickly once you see the property, so I cannot schedule a showing until I receive this information. If you are concerned about privacy, you can easily cross out all account and personal information, as all I need to see is your name and the amount."

If the purchaser claims they want to pay with cash, simply say, "If you are a cash purchaser, please bring me your account letter from your bank proving that you have the cash on hand. If you don't use a bank, I have no problem viewing the cash itself. I am sure you understand my concerns, as I want to be sure potential buyers can afford the property, particularly in light of our current economy, and I don't want to waste anyone's time."

**The** _Real_ **Ready, Willing and Able (RWA) Purchaser**

This type of caller is the ONLY type that you or any real estate salesperson should allow in your property for any viewings. This person states to you, "I have seen a picture, video, or a real estate sign on your property and am _interested_ in taking a look at it to see if it meets my needs, _and_ I have a pre-approval letter from my financial institution validating that I can purchase your property... yes, my credit was pulled and verified by my financial institution."

If you get this kind of call, you may have just met your future buyer. You will want to respond by saying, "I appreciate your interest in my property and have no problem working with you. I will need a copy of that pre-approval letter before scheduling a showing, but once I have that letter, what time and day is good for you?"

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### 8A

Statements/Questions from Purchasers about Your Property

When you deal with all types of purchasers, you will get all types of questions and statements from those purchasers. There will be some questions and statements you will like, and others that you will not like. Being prepared for almost everything will make you a more confident, better refined seller. Let's take a look at some of the common questions a purchaser will ask.

PURCHASER: "I see you are asking $200,000. How much do you _really_ want?" (The purchaser clearly knows this is not an "asking" price at all but will still often question it.)

SELLER: "I would really like to get $250,000, but I can settle for $200,000." (This will make it clear to the purchaser that the $200,000 you are advertising is an offered-at price and not an asking price.)

PURCHASER: "How many days has your property been on the market?"

SELLER: "One day too long." (This answer will earn you a smile from the purchaser, who will most likely ask the question again. If they do ask again, offer them the same answer in a very meaningful way.)

PURCHASER: "What is wrong with this place?"

SELLER: "I have disclosed all relevant information that I am aware of in my property disclosure that I provided to you. Besides that, the property is in wonderful condition. You are welcome to have a licensed inspector over to alleviate any concerns and make this real estate transaction a comfortable one for both of us as we enter into an agreement."

PURCHASER: "What is included with the purchase of this property? Are the living room furniture and any other items like the lawnmower included? Are the refrigerator and stove and any other appliances included?"

SELLER: "Everything is negotiable. The appliances can be included if the price is negotiated."

There are some considerations to think about when it comes to "included property" within the deal. For one thing, even if you are planning on throwing the appliances in anyway, there is nothing wrong with using them as a dangling carrot to gain a few extra dollars in the deal.

Also, if the purchaser is going to get a mortgage on your property, personal items besides household appliances cannot be included within the purchase contract. These might include lawnmowers, snow blowers, swing sets, and other similar items. These items are considered _chattel_ (personal property such as household goods or fixtures), and banks and many other financial institutions will not include chattel within a property mortgage.

If a purchaser is paying for your property by cash or check, you can include almost any items you want to sell to the purchaser within the purchase contract for the sale of the property. You can also include personal items within the sale of your property if a separate contract is drawn up to include the items for sale, the agreed upon sale price, and a contingency that the deal is rendered null and void if the purchase agreement for the property fails to transfer title to the purchaser. What this means is that if the property sale does not go through, neither does the sale of the personal items listed on the separate contract.

Summary

  * Only spend your time offering showings and details to the purchasers that are Ready, Willing and Able.

  * If your purchaser is not Ready **,** Willing and Able, remember that you are wasting your time and your resources by speaking with them. Get rid of them calmly, coolly, and politely.

****

### 8B

Determine What Type of Deed you are Selling

A deed is a written instrument that, when executed and delivered, conveys title to or an interest in real property. This is very important for all sellers and buyers. In simple terms, it is like a title of an automobile with certain warranties (if they exist).

In many areas, the common practice within the legal and real estate community is to allow the attorneys to inform the seller what is "common and appropriate" on the purchase contract as to the type of deed to transfer to the purchaser. In my experience, however, this is an area that most real estate salespeople do not know a lot about and attorneys dictate to the seller what type of deed to transfer. Many attorneys have sent me disturbing letters as to the type of deed we negotiated for the purchaser and wanted the type of deed changed to meet the common practice among the area and legal profession.

There are many common types of deeds, and before you sell your property, it would be helpful to be familiar with them.

**Warranty Deed.** This is a deed in which the grantor (seller) fully warrants good, clear title, as long as the same purchaser owns the property. This would be almost equivalent to selling an automobile and offering a lifetime warranty on any problems.

**Bargain and Sale Deed with Covenant.** A deed in which the grantor (seller) warrants or guarantees the title against defects arising during the period of his or her tenure and ownership of the property, but not against defects existing before that time.

**Bargain and Sale Deed without Covenant**. A bargain and sale deed with-out covenant contains no warranties. It does, however, _imply_ that the grantor holds title to the property

I do not care what area or what legal community you reside in, there are still best-case scenarios for every seller. When I represented sellers, we almost _always_ installed the Bargain and Sale without Covenant Deed as the deed that was going to be transferred to the new purchaser. Real estate salespersons and others thought this type of deed came from an auction "only" property, but this is false. Almost any real estate attorney will tell you that if it were their property, they would preferably negotiate a Bargain and Sale without Covenant Deed to the purchaser.

**Quitclaim Deed.** A conveyance by which the grantor transfers whatever interest he or she has in the real estate, _if any,_ without warranties or obligations. In this case, the analogy would almost be like selling an automobile cheap, only for the buyer to discover later that they did not buy it from the actual owner and there is a lien filed against it, thus rendering them out the money they paid in addition to incurring additional fees and headaches. Most attorneys may tell their clients to stay away from properties that only offer this type of deed.

**Executor's/Referee's Deed.** This is a deed delivered when property is conveyed pursuant to a court order. This deed is very common among bank foreclosures and may come with a warranty.

**Sheriff's Deed.** A sale conducted by a sheriff to pay off a judgment. All sales are as-is with no warranties implied or expressed with this type of deed.

As you can see from the types of deeds listed here, in my opinion, the best form of deed to transfer if you are a seller is the Bargain and Sale without Covenant Deed. It is a very common and recognized deed to transfer to the purchaser.

Summary

  * Every seller must negotiate the best deed to sell that is best for them.

DON'T allow your attorney to dictate to you which deed is the better custom deed for you in lieu of which deed is better for you in the long term.

****

Chapter 9

**Showing your Property to a** RWA **Purchaser**

Phone calls are coming in, and there is a lot of interest on your property. You have been screening the purchasers to see who is serious and who is not. So, what's next?

When you have an appointment scheduled to show your property to a pre-approved purchaser who is providing you the pre-approval form before the showing, make sure you reaffirm the appointment with a phone call to that same purchaser and don't just leave a message on the purchaser's phone confirming the scheduled appointment. Inform the purchaser that it is up to them to contact you twenty-four hours prior to the scheduled showing appointment and have them confirm the same appointment.

It takes a lot of effort and time to make sure the property is in showing shape. If you have children, be sure to find a babysitter. While you're at it, look for a pet sitter as well. Make sure the showing appointment has been confirmed twenty-four hours ahead of time by the purchaser. If the purchaser does not confirm the appointment after you have asked them to do so, DO NOT call them twenty times to see what is happening. DO NOT hunt them down. If they are truly serious about purchasing your property, they will be there.

Another emotional action you do not want to do when the appointment has been verified is to wait around forever (more than fifteen minutes) after the scheduled timeframe. When someone is late, we tend to contrive a million excuses as to the other person's tardiness. The only time you should accept a reason (an excuse, really) for tardiness in relation to the showing appointment, is when that same purchaser contacts you via phone around the time of the scheduled appointment and explains. In other words, if the purchaser can call you to tell you they are going to be a little late, this is understandable; but if a person contacts you the next day or next week to provide you with a story about why they did not show up, or if they don't contact you at all, you can assume they were not RWA – or at least not willing. You really shouldn't spend your time or emotions on this type of person when selling your property. Common courtesy is good, and your potential purchasers should practice it, just as you should.

Summary

  * Be efficient, courteous, and punctual.

  * DON'T accept or overlook tardiness without a valid reason.

****

### 9A

Get the Pre-Approval

The purchaser has arrived and is getting out of their vehicle. Everyone is smiling and shaking hands. After the normal, "How do you do?" and "Nice to meet you," your next question as the seller should be, "Can I get a copy of your pre-approval letter before we begin?"

Many sellers get caught up with the smiles and emotions of wanting to sell their property as quickly as possible, and sometimes they are not as prepared as they should be or allow some statements or questions to slide. This is a no-no. If a purchaser answers, "Uh, we forgot it on the table in our hurry to get here and see your wonderful property," then the seller needs to tell the purchaser in no uncertain terms that absolutely no showings can happen without the pre-approval. I have heard all the excuses of why a purchaser forgot the pre-approval, and none of them should be accepted. As a seller, you can reschedule the showing when the purchaser can retrieve the pre-approval. Stick to your game plan as a seller: no pre-approval equals no showings... period.

When a copy of the purchaser's pre-approval letter has been provided to you as a seller, let the showing begin.

Summary

  * Start the property showing when the pre-approval is in your hands – and not until then.

  * DON'T accept any excuses for why the pre-approval letter was forgotten and/or lost before the showing, and don't do the showing without it.

****

### 9B

This is MY Property

"Wow! What a nice property," the purchaser states as they get out of their vehicle. Since everyone is on the outside of the property, start with showing the outside. Believe it or not, most purchasers are aware of every little detail they see when viewing your property. Remember that purchasers are considering making a huge investment, so when showing a house, there is no need to state the obvious. Purchasers have probably already noticed many of the things you would want to tell them. In addition to this, there are several other things you can do to make your house showing a success.

**Let the purchaser walk in front of you.** By doing this, you will allow the purchaser to guide you to what interests them as they walk around the outside of your property. When a purchaser finds distinct traits that they like about a property, they will naturally gravitate right to them and have plenty of good things to say about something that appeals to them. This will enable you to elaborate on the things most important to that specific purchaser.

**Let the purchaser walk into the rooms (inside or outside)** _without_ **you.** We've already discussed this before, but remember that when you are showing the rooms of your property, you do not need to accompany the purchaser into each room. After all, you have been inside the room before, and you already know everything about it. There is no need for you to be in the same room as the purchaser. If you go into the room with the purchaser, you are not only making the room seem smaller and confined but also putting undue pressure on the purchaser. The purchaser should feel relaxed, comfortable, and able to make their way through a room without bumping into the seller. This is a major mistake that real estate salespeople make every day. Instead of following or leading them into a room, stand in the hallway or doorway. If they have questions, you are close enough to answer them, and if there is something you would like to point out, you can do so from your nearby position.

**Explain outside improvements.** If you have had outside improvements made to the property, feel free to explain why they were made, but do not complain about or discuss any of the headaches or costs involved with making the upgrades, repairs, or improvements. You might have had the worst contractors in the world, but your potential purchasers do not need to know about it. You do not want them associating any negativity with you or your property.

**Don't rush your potential buyers.** If the purchasers come upon an item they are trying to absorb to their liking or disliking, let them sort it out for themselves. Do not rush them past it or try to change their mind. Purchasers may like a lot of variables about your property, but that doesn't mean they will like _every_ variable, and rushing them will just annoy and irritate them further or make them think you have something to hide.

**Stop the showing if you know the show is over.** If the purchaser starts nitpicking and clearly dislikes most of the features of your property, feel free to stop the showing immediately. There is no need to spend more time showing a property if the purchaser clearly has no interest in it, and neither the seller nor the purchaser should feel obligated to continue the showing just because "the show must go on." Believe it or not, your property may not fit every purchaser's needs and wants. Show your appreciativeness for their initial interest, thank them for coming, and wish them the best of luck finding the property that is to their liking. Be classy and save everyone's time.

**Don't talk too much.** This has been mentioned before, but it deserves to be mentioned again because it is very important. Purchasers are at your property to view all aspects of your property. They are not there to hear about your daily life or your personal struggles. During a real estate showing, you should work hard to make sure there is an all-around positive atmosphere. If you disclose your financial problems to the purchaser at the showing, those same purchasers will remember this and utilize your financial problems against you if negotiating occurs. Talking too much can cost you big bucks in the long run.

**Be a good listener.** While it doesn't behoove you to talk too much about yourself, always show interest in your purchaser's stories, even if you do not really care. You want to make them feel comfortable and as if they _belong_ in the property. Quite like a businessperson trying to impress a potential client at dinner, you want to make them feel at ease and convince them that they simply must take what you are offering because it will somehow enrich their life.

**Ask questions after the showing.** When the showing has concluded, do not be afraid to ask some of the important questions. These might include "What do you think?" or "Are there any other questions or concerns that you may have?" And don't be afraid to get right to the point by asking, "Does this property feel like a good fit for your family's needs? When can we call that moving truck for you?"

**Reconnect after the showing for feedback.** Should you contact the purchaser after the initial showing? Sure! Why not? Even if they did not like the property, it is good to get unbiased feedback to make your next showing a better one.

Summary

  * Be sure you are showing your property in your best frame of mind. You are a salesperson selling a great product you believe in.

DON'T try to sell ice to Eskimos, _per se_. Give everyone credit for being very knowledgeable until proven otherwise **.**

****

Chapter 10

I Would Like to Purchase Your Property

Sometimes before and sometimes after a person is ready to put an offer in on your property, the potential purchaser will contact you to ask, "Do you mind if my parents or friend or contractor sees the property again?" In my experience, it is best in most cases to let the additional person associated with the purchaser in to see your property. This secondary person will serve as the final nail in the wood – either coercing the purchaser to go for it or run from it. Even still, a purchaser who is at the point of asking to let their acquaintances see the property cannot usually be swayed easily, regardless of the secondary person the purchaser is bringing in. The purchaser becomes emotional at this point, and the odds are still in the seller's favor. Once the purchaser brings in the secondary person to validate their intentions, the seller is in good shape for negotiations, and the buyer is still RWA - Ready, Willing and Able. If the secondary person finds an item or two that may be of minor concern, negotiate. Simply remind them that "no property is perfect," and most of the purchaser's dismay will be alleviated.

If the potential purchaser falls off the earth after this secondary person views the property, the sale was not going to happen anyway. Consider this action an emotional time saver for you and the purchaser and move on, even if the purchaser does not take the time to call up and say, "Thanks, but no thanks."

Summary

  * Be courteous and appreciative of all RWA purchasers who are interested in your property, as any one of them could be your actual buyer.

  * DON'T be mean or disruptive when a RWA purchaser does not like your property. Take the high road and handle it with class when a purchaser does not like your property as much as you do.

****

### 10A

Offers are coming in

The statement you have been dreaming of from an RWA purchaser has just been spoken: "I would like to put an offer in for you to seriously think about." The purchaser says, "I would like to offer you $200,000, and I want the appliances included."

When this happens, you must be careful not to jump the gun in your excitement. Regardless of whether the offer is a good one or a bad one, you should respond, "Thank you for your interest in the property. Let me sleep on it and think it over. I will get back to you." If the offer is a good one, you might be tempted to turn to your better half and tell them "We're almost there," but remember that it's not over till it's over, Mr. or Mrs. Seller.

In some areas of your real estate community, you may be comfortable with "Binders" or " _Real Estate Purchase Contract_ s." In my experience, ALL offers, stipulations, and terms associated with your property should always be installed on an actual purchase contract. Binders are potential terms agreed to, while Purchase Contracts are a binding terms agreed to by all parties. I will take the legal binding terms in lieu of potential terms associated with a Binder. A Purchase Contract is a legal contract with terms agreed upon and authorized by the seller and purchaser to move forward with the sale of a property with a contingency or two to go. If you utilize Binders in your real estate community, move forward into the times with _Real Estate Purchase Contract_ s.

Within the legal terms of most _Real Estate Purchase Contract_ s are sales terms agreed to by both parties. These might include:

  * Sale price

  * Names and addresses of legal seller and purchaser

  * Purchaser's financing terms

  * Home inspection options

  * Other testing of the property options (if applicable)

  * Tentative timeframes of financing, testing, and closing dates

  * Where the deposit on your property will be held in escrow

  * What is legally included and accepted by the mortgage companies in relation to financing the property

  * Legal and other pertinent addendums (disclosures required by law)

  * Attorney approval timeframes for acceptance, modifications, and rejections of the Purchase Contract terms

Do you know how much money is required as a down payment in your area in order to make the real estate deal legal with the use of a Purchase Contract? There are many answers to this question, and it is important to know the right one.

**No money down is needed since we have a legal contract that is signed and authorized.** This answer is absolutely incorrect. As unbelievable as it may seem, something beyond that contract IS required.

**$1,000.** If you do not have at least this much to put down, you cannot really afford the property, right? Some mortgage plans do not require this amount to be put down since there are 100 percent financing program. Such is the case with VA loans.

**The real estate salesperson always demands 7 percent of the sales price.** The reason for this is not a legal requirement but because, ironically, this is the amount of commission he/she will receive as compensation when the real estate deal goes through. Real estate salespeople are trained to get their fee in their own escrow account right up front when a Purchase Contract is being drawn up.

**A tiny, insignificant $1.** Believe it or not, this is the correct answer! By law, a purchaser has to show actual intent. To show intent, you must put down at least $1 with your signed Purchase Contract to solidify your actual intent on purchasing a property. Authorized Purchase Contract terms are not enough within the legal community alone.

As the seller, should you get more money down beyond the $1 intent? In my experience, I would know how much I could get down as an initial payment when I got the initial pre-approval. If a person could afford $100,000 as a down payment with the contract, then I would get the deposit when the Purchase Contract was signed and agreed to. On the other hand, if a person could only afford $1 and that same person had the appropriate and valid pre-approval, I took the $1 as the deposit and made it work (just not as comfortably). As the seller, you should ask the purchaser, "Besides your financing terms, how much can you put down if we come to an agreement of terms to purchase my property?" Their answer might pleasantly or unpleasantly surprise you.

Every purchaser is different, and there is not set dollar amount required by law other than the $1 to show intent. Each property sales price is different, and there is no mathematical formula to determine the set dollar amount for a down payment with a _Real Estate Purchase Contract_.

However, with most _Real Estate Purchase Contract_ s, there are terms set forth to all parties to clarify:

  * Where the deposit will be held and who will hold it

  * If the deposit is to be inclusive of the sales price and when will it be forwarded to the proper party

  * If the purchaser backs out of the deal without meeting the legal terms within the _Real Estate Purchase Contract_ , where the deposit will be forwarded to and to whom, if at all

Summary

  * Be receptive to all offers and terms.

  * Install all offers on a Real Estate Purchase Contract.

  * Realize you must start somewhere.

  * Recognize that every purchaser wants your property for almost nothing.

  * Install all terms on a _Real Estate Purchase Contract_.

  * DON'T be offended when a purchaser low-balls you.

  * DON'T be offended when an initial offer is completely different in terms than what you have both previously talked about.

  * DON'T be disruptive or emotional if the purchaser's initial offer is not full price.

  * DON'T bank on a verbal offer and expect it to become legally binding.

****

### 10B

Don't Be So Emotional

As I stated in many of the previous chapters, if you are too emotional, you really should not be selling your property without professional representation. It is okay to become a little emotional, but becoming too emotional will almost always jeopardize you business deal and cost you a lot of money in negotiations. Even though you are selling your personal property, this still is a business deal, and that is the attitude you must maintain throughout.

The purchaser's goal is to obtain the property for a steal of a price. The seller's goal is to obtain a full purchase price to their terms. Most initial offers from purchasers are not at full price with satisfactory terms to the seller. This is the normal nature of business, and you should not be upset or angry that the first offer on your property is not at full price. Remember that everyone needs to start somewhere with an offer.

Should you meet face to face with the purchaser to hash out and agreement of terms, or can you verbally communicate over the phone? Both types of dialogue work, depending on what characteristics both parties have. Your dialogue can even be email messages to each other. Continued dialogue is good for all parties when negotiations have started. When I wanted a deal done quickly, I brought my sellers and purchasers together with myself present. I then acted as a go-between or mediator and still represented my client, coaching them as to what to say or not to say before the meeting began. Coaching and preparing my clients before the meeting with the purchasers almost always made my sellers more appreciative of me as their representative. My sellers knew what to expect. When an agreement of terms was reached at the face-to-face meeting, I would install all the terms on a real estate contract, have all parties authorize a signature, and then fax over the documents to the attorneys that represented the seller and purchaser.

When a purchaser asks, "What will you take?" don't be afraid to state, "Full price." If you giggle and say, "I don't know" or "Within $10,000 of the offered at price" or "I really knew I wouldn't get full price, so I decided to ask high and knew later on that I would accept lower," you will inevitably be costing yourself a lot of money. Be firm and command respect from the price that is offered on your property.

If a purchaser offers you a lower price with terms that currently do not meet your requirements, you can accept the offer, reject the offer, or modify the offer with a counter-offer. On most offers, I highly recommend that you counter-offer. As a seller receiving an initial offer, take your time to review the terms from the purchaser. Definitely sleep on the offer if your situation allows it.

Now that you have slept on the purchaser's offer, counter the offer with your own terms. In real estate, it is common to fax over the _Real Estate Purchase Contract_ with the terms (either from the purchaser or seller) and also to date the offer with an expiration date of terms. This means that the terms from either the seller or purchaser do have an expiration date. If there is no expiration date with your offer terms, the terms can legally be good for a long period of time. With all terms you fax or personally deliver to the other party, install an expiration date as to when your terms have to be accepted. This serves as pressure on the other side to put up or shut up.

The purchaser has just received your counter-offer and also has the same choices as you did: accept, reject, or counter-offer yet again. Is there a limit to the amount of times both parties can counter an offer? No. As long as the offer is still moving along, this is good news. It means that both parties are still interested in working with one another.

Does your offer have to be written on a real estate contract? The seller and purchaser can negotiate offers verbally or face to face. Either way, whatever terms have been agreed to should always be put in writing in a _Real Estate Purchase Contract_. This will typically become legally binding when both parties authorize the terms and the attorneys review and accept all of the language. Once this is done, you are almost there... just not quite.

Summary

  * Control your emotions.

  * Continue dialogue, even when the offer still does not meet your terms.

  * Install agreed-upon terms on a _Real Estate Purchase Contract_.

  * Have an attorney review the real estate contract you authorized.

  * DON'T let your emotions cost you the real estate deal and cost you money.

  * DON'T stop the dialogue just because you feel offended or insulted.

  * DON'T get angry at purchasers for trying to get your property at a lower price; they're only human!

  * DON'T think you're there yet just because you have a signed _Real Estate Purchase Contract_.

****

### 10C

No... You Can't Have My Dog, but I Will Throw in My Mother-in-Law

You and the purchaser have agreed to the financial terms that are satisfactory to both of you. Is the refrigerator staying or going with you? Is the beautiful light fixture staying or going with you? Is the brand new dishwasher staying or going with you? What type of deed have you negotiated to install in the contract? Can the purchaser have the riding lawnmower?

The above questions must be answered when negotiating terms and accepting offers from purchasers. Almost every deal in a real estate property transfer must be clarified.

Remember that if the item you are negotiating is hardwired or connected to the property, the item is staying and moving into the purchaser's possession unless specifically written in the _Real Estate Purchase Contract_. Some examples of items that usually stay (unless otherwise negotiated) include:

  * All hardwired appliances (dishwashers, exhaust fans, built-in stoves and/or microwaves, etc.)

  * Water softener systems

  * Drapes and custom curtains

  * Trees and plants

  * Alarm systems

  * Smoke detectors

  * Storm windows/screens

  * Wall-to-wall carpeting

  * Propane tanks

  * Heating and lighting fixtures

  * Storm and screen doors

  * Built-in bathroom and kitchen cabinets

  * Fireplace insert doors and/or screen

  * All buildings and improvements

  * Television aerials

  * Plumbing fixtures

  * Pumps

  * Fencing and/or attached awnings

  * In-ground pool

  * Even the light bulbs must stay

Some items that may stay or be removed, depending on negotiations may include:

  * Refrigerator, microwave, stove, etc.

  * Any appliance that is not hardwired

  * Outdoor sheds that are not attached to the ground

The following items are typically not to be included in a _Real Estate Purchase Contract_ when the purchaser is taking out a mortgage to finance the property:

  * Above-ground pool

  * Riding lawnmower and snow blower

  * Personal items (jewelry, electronics, clothes, etc.)

  * Personal toys (boats, motorcycles, tractors, etc.)

Once the price and the items included and excluded with the property sale have been agreed to, make sure you have negotiated the type of deed you will be transferring at the closing process. Even the type of deed (see Chapter 8) can be negotiated for a price. If a purchaser is adamant on a different type of deed other than the best one for you as a seller, inform the purchaser, "For a fee of $__________, I will sell you a _________ type of deed that meets both of our preferences." When asked, I would always state, "Almost everything is negotiable," and "You can make my client an offer that they cannot refuse if you really want it." (Besides, I liked sounding like the real estate Godfather now and then!)

Do you have to install the financing terms within the _Real Estate Purchase Contract_? Yes. This is protection that every attorney representing a purchaser will demand. If a purchaser cannot get the financing for your property, they will not be liable for emotional, time, and monetary losses incurred. The purchaser will get their deposit back if they met the financing contingency that was present. As a seller, you should be pretty confident with their financing terms because you have received their pre-approval letter for the financing institution that pulled their credit.

Different types of mortgages have different criteria. Most mortgage loans have a timeframe from beginning to the closing process of six to eight weeks. This is a tentative timeframe, so don't call the movers with an exact date just yet.

You may even come across a loan from the purchaser whereas the purchaser comes back to you and states, "My bank says I need 3 percent seller concessions in the real estate contract. Can we modify the contract to where you will give me 3 percent seller concessions toward prepaid closing costs?" If this happens, you might be inclined to tell them, "There is not a chance in h#%@, and the deal is off," but don't rush to that conclusion just yet.

Seller concessions are basically a way in which the seller allows the purchaser to _borrow_ an additional 3 to 6 percent on top of the agreed sales price. As the seller, you are allowing the additional borrowing. Then, at the time of transfer of title (the closing process) the dollar amount of the 3 to 6 percent that the seller is conceding and/or allowing the purchaser to borrow gets moved toward the purchaser's prepaid closing costs and fees. As the seller, you are not pulling money out of your pocket in a physical way and handing it over to the purchaser. Instead, you are just allowing the purchaser to borrow additional money to pay their own closing costs. This action by the seller to allow this seller concession is common and a good thing to make sure your own real estate property actually does close. It's just creative financing, and in the long run, it costs you little to nothing.

Summary

  * Clarify everything on a _Real Estate Purchase Contract_ that will be excluded or included with the transfer of property.

  * Work with purchaser in their ability to get financing. Your attorney will assist you in clarifying financing components.

  * Remember almost everything is negotiable. "Make me an offer I cannot refuse" works just as well in real life as it does in the movies.

  * DON'T leave any sentimental personal belongings or items in the initial showing if they are not going to be part of the property transfer.

  * DON'T close your eyes to creative financing that the purchaser has been pre-approved for. Contact your attorney for clarifications at any time.

  * DON'T accept verbal offers without written backup.

DON'T allow the type of deed the purchaser wants get in the way of the sale of your property. Contact your attorney for advice.

****

Chapter 11

Real Estate Laws do not pertain to you. Wrong!

This is a very simple chapter that you need to comprehend to the fullest **.** Laws DO pertain to you as a For Sale By Owner when selling your real estate property. Be fully aware of the following summary of real estate laws.

Civil Rights Act of 1866

The law, an outgrowth of the Civil War, prohibits any type of discrimination based on race or color.

Federal Fair Housing Act of 1968

It is unlawful to discriminate on the basis of race, religion, or national origin when selling or leasing a residential property. In 1974, an amendment added sex (gender) as a protected class, and in 1988, two new classes were added: handicaps and familial status.

Americans with Disabilities Act

Prohibits discrimination based on disabilities.

Disclosure of Lead-Based Paint and Lead-Based Paint Hazard Addendum

Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such property may present exposure to lead from lead-based paint that may place young children at risk of developing lead poisoning. Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The seller of any interest in residential real property is required to provide the buyer with any information on lead-based paint hazards from risk assessments or inspections in the seller's possession and notify the buyer of any known lead-based paint hazards. A risk assessment or inspection for possible lead-based paint hazards is recommended prior to purchase.

**Property Condition Disclosure Forms (applicable in many states** **, if not all)** Today, property condition disclosure forms for all residential real estate sales are required in many states, if not all of them. This mandates that For Sale by Owners and real estate salespeople (on behalf of their seller clients) have to provide this completed form to the purchaser BEFORE the _real estate purchase contract_ has been signed. In some states, if this form is not provided to the potential purchaser, the purchaser is then allowed a credit toward the price of the property on behalf of the seller. This means the seller has to pay the purchaser if the property disclosure form is not provided to the purchaser. If you are unsure if you should or should not provide the property disclosure form to the purchaser, you may want to consult your attorney for legal advice.

In New York State, the _Property Condition Disclosure Act_ requires the seller of residential real estate property to cause this disclosure statement or a copy thereof to be delivered to the buyer or buyer's agent prior to the signing by the buyer of a binding contract.

Most of these property disclosure forms are not very difficult to complete properly. Most property disclosure forms include simple questions pertaining to:

  * Who is your electric provider?

  * How long have you owned the property?

  * How long have your resided at the premise?

  * Do you know of any buried oil tanks on the premise?

Advertising and Promoting Your Property Accordingly

**Zoning Concerns.** Knowing the zoning and local classification of your property is a must when marketing your property for sale. _Zoning ordinances_ may give a potential purchaser the right to build another building on the same property, start a business on the property, and to expand on the property in some way. The zoning of your property may also restrict a future owner from plans they may have after they purchase the property. If you are promoting your property as a commercial property when it is a residentially-zoned, you can get in trouble. Know your zoning ordinances. Contact the building inspector or the County Clerk in the county of the property being sold. That office can answer most of the pertinent questions you may have concerning the zoning ordinances in your area.

_Zoning ordinances_ _– An exercise of police power by a municipality to regulate and control the character and use of the property._

**Homeowner's Associations.** If the property you are selling is located within a _homeowner's association,_ disclose this information in writing within your property condition disclosure statement. Providing a copy of all homeowner association rules and regulations to a potential purchaser is a good thing. Disclose, disclose, disclose.

_Homeowner's association_ _– A nonprofit group of homeowners in a condominium, cooperative, or PUD that administers common elements and enforces covenants, conditions, and restrictions associated with the property._

**Private and Public Roads**. Is the property you are selling on a private or a public road? Usually, if your property is located on a private road, certain restrictions apply to the property owners. The property owners may only have a right to ingress (go in) and egress (go out) of the property, along with a responsibility for potential maintenance costs of the road. If your property is located on a public road, know the road frontage associated with your property. Know how many feet of property you actually own alongside the public road. In most cases, the more road frontage you own with your property, the more valuable your property will be in a potential sale. Disclose the right information on your property disclosure form.

**Classification**. When promoting your property for sale, make sure you know the _classification._ Your local assessor should have classified your property in the correct real estate classification. Check your tax bill to view the classification of the property. If the property consists of a two-bedroom ranch home on a full basement, then the property is a two-bedroom ranch home on a full basement; your property is NOT to be advertised as a two-bedroom ranch home with one bedroom downstairs. Your property is not classified as such, and you should not advertise the property as such. If you do advertise your property incorrectly, this may be fraudulent, and you may need an attorney down the road should the new purchaser pursue legal action against you.

_Classification_ _– A systematic classification of groups and categories according to established criteria of your property._

If your property is really a 10 x 14 foot wood shed with a floor located in the woods about two miles from any water, it is NOT considered waterfront property; do not advertise it in a misleading way. Do not mislead the potential purchasers in any way when selling a property. Potential purchasers who come to see your property (quite possibly from a long trip) will be very justifiably angry if they feel they have been misled in the property advertisements. Purchasers usually only get meaner if they actually stay for the showing knowing that you just wasted their time. Do not waste anyone's time, including your own.

In general, there are many laws in every state that regulate all real estate property and sales of your real estate property. The above laws are some of the many you should abide by. If you are unsure of the real estate laws that apply to you, consult a real estate attorney and your state's website relating to real estate laws within your area.

Summary

  * If the law applies to you, follow it and fill out the proper legal forms pertaining to your real estate transaction.

  * Disclose all information you know on the property condition disclosure form.

  * If you think you may get away from disclosing important facts now, it may come back to bite you in the a$$ later in legal fees.

  * DO NOT think you are above the law in real estate. You may pay a heavier price later if you do not follow the real estate laws that pertain to you.

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**Chapter** **12**

Legal Documents

In real estate, there are many legal documents to protect everyone. Contracts, addenda, disclosures, and more may encompass your real estate transaction. This is where a competent real estate attorney may be able to represent your best interests. Inside many real estate contracts are contingencies (hoops, hurdles, and test procedures) that your property may have to go through. There may be some form of disclosure document(s) that you may have to provide to the other party. Usually, depending on the property, the Purchase Contract may contain a smaller contract within the main contract; this is called an addenda. Even though you have agreed to terms on your real estate property transaction, you're still not there. Below are some sample types of additional hoops, hurdles, and test procedures that your property may go through

**Mortgage Contingency** – This type of contingency usually states the type, amount, and duration of a loan the purchaser is financing to obtain your property. If the purchaser does not obtain the loan within the stated guidelines, the purchaser may legally back out of the purchase contract or renegotiate the contract.

**Attorney Approval Clause** – This clause within the real estate contract usually states that both parties' attorneys have the right to; accept the terms within the contract in entirety, refuse the terms of the contract in entirety and demand the deposit to be refunded immediately, and/or modify the contract to be acceptable for their party or both parties.

**Appraisal Contingency –** This usually only pertains to a property that some sort of mortgage financing is being applied to. This clause usually states that the property within the _Real Estate Purchase Contract_ must appraise at or above the value of the agreed purchase price of the property. If the property does not appraise for this amount, the purchaser has the legal right to opt out of the contract or renegotiate the contract price of the property. This appraisal is at the purchaser's expense.

**Title/Lien Search** – This expense can be negotiated as to who shall pay the fee. In most areas, the expense of the search is burdened upon the customary party (the party who the legal community usually determines is responsible). This title search is done to verify that title has been passed properly to each new owner throughout the past and the new owners have the right to the entire _bundle of rights_ in real property ownership. This search is done to find out the title history and ensure that it was passed along with no errors or omissions, along with the proper filings. The lien search is also standard to make sure there are no hidden liens that the parties are unaware of besides the usual mortgage company lien.

_Bundle of rights_ _– The concept of land ownership that includes ownership of all legal rights to the land (for example, possession, control within the law, and enjoyment.)_

**Mortgage Payoff** – This is a standard payoff letter from the financial institution or mortgage company which the seller has to pay off. Sellers should know the payoff amount and have the letter of the note before the seller accepts or authorizes a _Real Estate Purchase Contract_. If you accept a _Real Estate Purchase Contract_ before you know your note payoff, you may be in financial trouble and have to cough up some of your own money to pay off the note.

Disclosures are another common part of the legal paperwork involved in the sale of a property. Below are some of the most common:

**Lead-Based Paint Disclosure** – Again, this is a test performed at the expense of the purchaser to determine if there is any lead-based paint present. If you know there is lead-based paint present, you are required to disclose this to the purchaser. If you had lead-based paint at one time but no longer, you should also disclose this information, along with your remediation receipts, to the purchaser. For more details, review Chapter 11.

**Property Condition Disclosure** – This form of disclosure usually informs the purchaser about certain facts pertaining to your property such as:

  * Do you have any buried oil tanks?

  * Do your oil tanks leak?

  * Has any hazardous waste ever been buried on your property?

  * Who is your electric provider?

  * How long have you owned and/or resided in the property you are selling?

  * Additional pertinent information.

In some states, if this property condition disclosure form is not presented to the purchaser (completely filled out) within the proper timeframe, the purchaser may be entitled to receive a credit on the purchase price. Please check into your state laws to verify the timeframe required to provide this disclosure form to the purchaser. If you are unsure of when to provide this form to the purchaser, consult your real estate attorney for legal advice.

In addition to disclosures, addenda (smaller contracts within the large real estate contract) can be included for tests and miscellaneous items approved by both parties. Some common addendas are:

**Condition of Premise Testing/Home Inspection** – This type of contingency usually states that a certified or licensed home inspector can test all aspects of your property that they can visually see to verify the positive and negative components of a property. In most _Real Estate Purchase Contract_ s, if the same home inspector determines that one item of the same property has a defect that may cost above $1,500 to repair (this amount can and will vary in select areas and property sales amounts), the purchaser may legally opt out of the real estate deal or renegotiate the terms of the real estate contract

**Septic System Testing** – This type of testing usually tests the ability of the property septic system and leach field (properties with a public sewer system will not have this test performed) to absorb a certain amount of fluid within a specific timeframe. A septic professional will install a dye into your kitchen sink, which then goes into your septic tank, along with a determined amount of water. The purchaser hires a septic company (at the purchaser's expense) to excavate the top of the septic tank (to verify there is a septic tank on the premises) and visually examine the inside of the septic tank and inspect the tank components. This is a common practice.

**Well/Water Flow and Quality Test(s)** – These tests are performed at the expense of the purchaser to determine the g **a** llons per minute (GPM) and the ability of the private well (properties with public water supply will not have these test performed) to recuperate enough water to supply the property. They will also review the quality of water and its contents to make sure it meets the locality's requirements for safe drinking water.

**Radon and Other Gas Testing** – These tests are most likely at the expense of the purchaser. Most of these test are done by a professional to determine if the property within the _Real Estate Purchase Contract_ has only safe amounts (if there ever is a so-called safe amount) of gas levels within the property confines. If a hazardous level of gas is found by this test, there usually are safe remedies with a cost to divert the gas and/or radon levels outside the property and safely away.

It is pretty standard to install timeframes on all of the above hoops, testing, contingencies, and any addenda that may be included within the same _Real Estate Purchase Contract_. Installing dates within the above documents prevents buyers from dragging their feet and tying up your real estate property for a long time. Keeping the dates within normal reason moves the real estate transaction along in a timely manor to protect all parties involved.

Some sample timeframes to consider when making a real estate transaction might include the following:

Tentative mortgage approval times:

Conventional Loan – 4-6 weeks

VA loan - 6 – 8 weeks

Most other loans – 6 weeks

**Tentative attorney approval of a** _Real Estate Purchase Contract_ **:** 5 _business_ days (not calendar days)

**Tentative home inspection deadlines for inspection and reports to all parties (if there is a serious defect):** 10 days from the agreed authorized _Real Estate Purchase Contract_ date. If all the terms of the purchase contract were signed on the first of the month, home inspection should be completed by the eleventh.

**Tentative transfer of title/possession:** This date is usually installed 2 weeks after the mortgage date. If the mortgage approval date is March 14, install your tentative closing date as March 28.

ATTENTION SELLERS... DO NOT MOVE YOUR FURNITURE AND CALL THE MOVERS UNTIL you contact your attorney approximately two weeks BEFORE the tentative transfer of title and you have received the financial commitment from the mortgage company.

Please understand the word "tentative" in real estate. Once attorneys and other professionals get involved in your real estate deal, their schedules may not coincide with your _Real Estate Purchase Contract_. If you need more time on any of the above dates, talk to your attorney about modifying the dates on your behalf.

Summary

  * It may be normal for title updates and full searches to take one to four days to fully complete for your attorney's review.

  * Allow purchasers to take as many tests as they want on the property at their expense. The more comfortable a purchaser is, the easier the deal will be.

  * Install the actual date (Example: January 1, 2022) for all inspections, contingencies, and other important dates that need to be included in the contract.

  * Have patience with purchasers who are working with financial institutions to get their mortgage approval. It really isn't their fault most of the time; it is the banks.

  * DO NOT expect the closing date in your contract to be a 100 percent solid date to call the movers.

  * DO NOT install statements like "ten days," "six weeks," or "one month" on a _Real Estate Purchase Contract_. Use actual, specific dates where required.

DO NOT be surprised that delays occur when other professionals get involved.

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Chapter 13

My Property is in Perfect Shape... Trust Me

Before I got into real estate, there was no regulation or licensing needed to be a home inspector in my home state of New York. I came across home inspectors on a regular basis who knew very little about a property and its components. When I was a home inspector, it was not customary for purchasers to have a home inspection. Most of the purchasers had their handyman friend or a relative who was into construction do the survey on their property and its components.

Times have changed. In New York today, as well as in other areas, most (if not all) home inspectors have to be licensed or certified, as well as insured (in some capacity), in order to provide the home inspection service to the public. This is good for everyone. The real estate industry needs and wants home inspectors to be regulated. This allows you to verify their credentials, check for registered complaints, and find a professional who should be unbiased in the real estate transaction.

There are two types of home inspectors in my book: the superhero home inspector and the professional home inspector. The superhero home inspector comes to the property on behalf of the purchaser who is compensating them, hell bent on finding at least one problem with the property and magnifying it to be the most catastrophic it can be. The superhero home inspector yearns to hear "Thank goodness we hired you! You're the best," and promptly thereafter, the seller is notified that the buyer wants out of the deal.

The professional home inspector actually comes to the property with professionalism and is proactive in the positive aspects of a property and in explaining all defects a property has – even the really bad ones. For almost every defect, there is a financial solution to repair the same defect. This means it is up to the purchaser and seller to renegotiate a harmful, deal killer defect or it is up to the purchaser to determine if they want to proceed or get out of the real estate deal themselves. It is not the job of the home inspector to be a deal killer or emotionally involved at all. They are hired to do a job, not to relay their unwarranted emotions when a defect is found. Unless they are a licensed or certified contractor in their area of work, the home inspector cannot and should not provide written estimates. Either the defect found is above the one item of $1,500 or it is not.

If a home inspector finds one defect that may cost above $1,500 to fix, the property owner may have the option to immediately have it fixed or can _concede_ the repair cost amount to the purchaser at the time of closing. As a seller, your main goal is to close the deal and move on. Depending on the market and defect, it makes common sense (most of the time) to have the item fixed when discovered if you have the money to do so or to concede the amount to the purchaser at closing if you do not have the monetary amount readily available before the closing.

_Concede_ _\- To give back to the other party in a real estate transaction. This is just a numbers moving game on paper (most of the time). In lieu of the seller_ _netting this much, the seller nets less after the concession to the purchaser._

I have come across many sellers who have said to me, "I have lived with that same problem for ten to twenty years, and I am comfortable with it. I am not spending one dime to fix it. They can get lost!" As a representative of the seller, I would let my clients blow off some steam to me (that is part of what I am getting paid for), but then provide some simple solutions as to fixing the defect found by the home inspector. First, there aren't too many perfect properties out there. If there were, they wouldn't be for sale. There are bound to be various minor defects in most properties and major defects in some properties. The solution is usually pretty standard:

  * If you have the money and want the deal to go through, FIX IT.

  * If you don't have the money and still want the deal to go through, concede the money at closing to the purchaser.

  * If you are crazy and have other purchasers who do not mind the same defect that was found, let the deal fall apart and move onto the next purchaser and get them into a _Real Estate Purchase Contract_.

Most of the time when I listed a property with some imperfections, the offered-at price was reflective of the property with the imperfections. Therefore, it was not uncommon for my sellers to wonder if they had to warranty the property after they sold it. My answer to them was no, because almost all properties sell _as-is_ , and this is often reflected in the purchase contract.

_As-is_ _\- Contract words indicating that the seller makes no guarantees or warranties about the property they are transferring to the purchaser._

Usually, providing the purchaser with inspections and proper disclosure opportunities within your agreed purchase contract is a positive move. One important thing to note is that you should never knowingly avoid informing a purchaser about a major defect of your property. You should not try to hide major defects in any way. Provide inspection opportunities and the proper real estate disclosures to all purchasers who enter into a _Real Estate Purchase Contract_ with you. If a purchaser refuses an inspection opportunity in a _Real Estate Purchase Contract_ , then in most cases, you are legally covered. See an attorney for further legal advice should you have questions about the topic above.

Summary

  * Leave your emotions behind if you receive a low-ball offer.

  * Provide inspection opportunities within your _Real Estate Purchase Contract_.

  * Realize your property may not be perfect as you think.

  * Your goal was to sell the property, so continue over any hurdle you face to meet that goal.

  * If your purchaser hired a superhero home inspector that killed your real estate deal just because he could, inform the purchaser that you will get a second opinion from a professional home inspector at your own expense in order to keep the deal moving forward.

  * DON'T kill your own real estate deal by being too offended by an initial low-ball offer. Offers have to start somewhere, and hopefully will move up to your agreed terms.

DON'T go into selling your property with an "I am not fixing anything or conceding anything" attitude. Try to make the deal work for all parties.

****

Chapter 14

What is holding up my Closing?

The contract terms have been agreed to, and the property has passed the home inspection phase. The appraisal has been completed, and the attorneys are trying to schedule the closing but are saying the mortgage company is holding it up. What is going on?

As a seller, you're ready to call the movers, and you have envisioned yourself in your new place of residence, even though your existing place of residence has not closed as of yet. You contact your attorney to find out what is going on and when the scheduled closing date is. Sellers have to realize that in most attorneys' offices, the secretary or paralegal does most of the real estate work and actually knows the transaction details of your real estate better than the attorney does.

To get quicker responses and better answers concerning your real estate transaction, always ask to speak to the secretary or paralegal who is handling your real estate case. They should be able to provide you with the answers you are seeking because they do the brunt of the paperwork. If the secretary or paralegal cannot answer the question, they will ask the attorney to either contact you or relay the appropriate answer to them and then to you. Being polite to and appreciative of the secretary or paralegal handling your real estate transaction will get you the answers you are seeking in a more efficient way.

When you do contact your attorney's office concerning your real estate transaction, the secretary or paralegal may respond to you in a number of ways if you ask about the date of your closing or why it is being held up. Some of the more common answers include:

  * "We are waiting on the purchaser's attorney to review the title."

  * "We have tried to contact the purchaser's attorney, but they will not call us back."

  * "We are waiting on the _commitment letter_ and package from the mortgage company."

  * "I don't know, but I will call the parties involved and find out."

  * "The mortgage company is still waiting for the appraisal report."

_Commitment letter_ _– This is a letter sent by the purchaser's financial institution to the seller's attorney stating that the purchaser's financial institution will advance the funds committed to the property to complete the purchase of the property._

Remember, the attorney you are compensating has an obligation to represent your interest at all times. If you are not satisfied at any time, feel free to express your dissatisfaction to the attorney directly. If you have expressed your dissatisfaction to your attorney and your attorney does not change his/her actions, you have a right to terminate your contract with them immediately. Most people are intimidated to terminate their attorney for a variety of reasons, but the truth is, there are at plenty of attorneys out there out there ready to pick up your case in a timely fashion and represent you to the fullest. Attorneys do not walk on water and therefore should be held accountable for all their actions or lack of actions.

Can you contact the purchaser's attorney, mortgage institution, or appraiser to find out the status of your real estate transaction? I would advise you to contact the purchaser first and put a little pressure on them to contact the companies involved for an updated status. They can then update you. If this action does not work and the purchaser is dragging their feet and is too slow in moving forward, go ahead and make the phone calls to the appropriate parties involved. If you can keep the ball moving, go for it. There is no law against you acting accordingly if everyone else is not.

If the property you are selling has been purchased by a buyer who is paying by certified check (cash), your closing date should be set about ten days after your home inspection. If you are not selling a property with a residential building on it and it is composed of just vacant land, your closing should take place within ten to fourteen days or earlier. This process really depends on how quickly your attorney acts or does not act. The last hurdle for most cash purchase deals is the _title_ _search_ that has to be completed and reviewed by both parties' attorneys.

_Title search_ _\- An examination of public records to determine the ownership and encumbrances affecting real property._

Once the attorneys for both parties (purchaser and seller) have reviewed and approved the current title for the property in contract, the closing process should take place relatively quickly.

As stated in the beginning of this book, the whole real estate industry moves at a turtle's pace. Quite frankly, most of the professionals involved in this industry accept this and do nothing to propel it faster and further ahead (Again, can you spell L-A-Z-Y?) This is why I am writing this book.

Summary

  * Be kind and courteous to your attorney's secretary or paralegal.

  * Try to keep a communication line open with the purchaser or their representatives.

  * DON'T accept, "I do not know" for an answer. Almost everyone involved is being compensated for a service. Make sure every person is actually doing their job.

DON'T make threats to any of the parties unless you are prepared to follow through with them.

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Chapter 15

I Will Meet you at My Attorney's or Closing Agent's Office for the Closing

FINALLY! You just received the phone call from your attorney giving you the date of the closing and telling you to go ahead and call the movers. This is a very good call to get from your attorney. Most attorneys can provide you with a five-day notice of the closing date. It is not recommended to contact the mover or move your belongings out of the sold premises on the day of the closing transaction. Emotionally and physically, it is a long and tiring day for most people, if you should attempt this feat.

In most _Real Estate Purchase Contract_ s, the language of "broom clean" is present for the sellers to adhere to. The buyer has the right to walk into your property within twenty-four to forty-eight hours of the closing process to make sure the property is in "broom clean" condition and the mechanical and cosmetic aspects of the property have not been changed since the last showing to the buyers. Do not remove mechanical or household items that were negotiated within the _Real Estate Purchase Contract_. "Broom clean" condition does not mean the sellers can leave minor debris on the floor so the purchasers can clean the debris with a broom. It also does not mean for the seller to remove all of the light bulbs, door handles, etc. Be a class act and clean your property as if you were the buyer walking into your new property for the first time. Do not worry about the "white glove" test for cleanliness, even though this would be a nice touch. "Broom clean" means you should have the property in a clean condition so that the only matter remaining is the usual dust and dirt left on the floor from regularly walking around.

Once the walkthrough has been completed by the buyer, the next step for both parties is to meet at the attorney's office for the closing. In most cases in a real estate transaction, the closing usually happens at the bank attorney's office or at the purchaser's legal representative.

As a seller, it is pretty much mandated in most closings for you to bring some sort of photo ID (usually a driver's license). This is to validate who you actually are and that you are the person who is authorized to sell or transfer the title of the property to the buyer. The buyer will also be asked to provide their ID as well. The attorneys will make copies of the IDs for their files.

In most closing transactions, the seller has the lesser of the legal paperwork to authorize. Your attorney will provide you a fifteen-second idea of what is in most of the paperwork and the legalities that each document contains. Your attorney will probably state, "These are common documents, and I have read all of them. Go ahead and sign here, there, here," and so on. The purchaser who takes out a mortgage to pay for the note on the property usually has to authorize anywhere from fifty to a hundred pages or more. The seller definitely has the lesser of two evils concerning the real estate paperwork.

The seller usually does get back a prorated portion of taxes and other applicable fees paid in advance concerning the property sale, along with all heating fuel left on the premises. It is very important to measure the amount of heating fuel (oil, liquid propane, or kerosene) you have left on the property and provide this information to your attorney BEFORE your closing so that you can get the fuel back.

Most attorneys will provide both of the parties a detailed copy of the real estate transaction form. This form dictates the expenses and net profit the seller is walking away from the table with, along with the expenses paid out by the purchaser concerning this real estate transaction. Some of the seller's expenses may be documented as; attorneys' fees, title abstract fee, local filing fee, mortgage payoff, net profit, etc. Most (if not all) of these expenses or income received are normal documentations with a real estate transaction.

It is important for all sellers to realize who is working for you. The attorney you hired to handle your real estate transaction represents you (the seller) in entirety, and you are compensating the attorney for this service. This means that at _any time_ when you are confused and would like an explanation concerning documents in front of you, you are free to pause your signing and ask your attorney to clarify any concerns you may have before you sign your name on the dotted line. The real estate closing should be a joyful process for most sellers, and you should walk away with a clear understanding of what just took place within your own real estate transaction. The closing process should not be a confused, distracted, and disturbed process in any way. Feel free to ask your attorney as many questions as you need to make the closing process a smooth one.

If you have a concern or question that may be private in nature, feel free to ask your attorney to speak with you in private. Your attorney will be more than obliged to go out of the room with you to explain almost anything in its entirety.

Once both parties have authorized all of the necessary documents related to their real estate transaction, it is time for the attorney in charge of distributing the checks to the appropriate parties to cut the checks, along with providing a copy of all checks disbursed to all of the parties' representatives to install in a file and hold for future reading when you are bored.

Upon receiving your check from the attorney, review it accordingly to make sure the final (net) number to you is the correct one. Most attorneys will tell you that it is much harder to fix a closing problem after the closing has happened. Now is the time to ask or clarify your concerns should you have any. If your check reflects the correct amount due to you, slide your keys, remotes, and any combination codes that may apply to the property over to the new owners (the buyers). Before you leave the closing, spend a minute or two with the new owners to clarify which key and remote goes to what door and so on.

Make sure you thank all parties of the closing, which may include the secretaries and attorney paralegals. Trust me, they do a lot of the major work involved, and most do not get enough credit or recognition for their service. Leaving on a good note now may pay off if you have questions or concerns later on.

Summary

  * If you have any questions or concerns at any time during the closing, feel free to speak up and ask.

  * It took a lot to make it to the closing process, so be a class act to the end.

  * DON'T be mad at the buyer if they got your property at a reduced rate that you reluctantly agreed to.

DON'T express any negative emotions toward your attorney or anyone else at the closing transaction. Be an adult.

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Chapter 16

Let's Sell another Property

Wow! You have been through many physical and emotional hurdles of selling your property, and it all worked out. You have cashed your check. You're closing out a chapter in your life, and it's time to move on. Congratulations! You may want to document your real estate transactions in a diary throughout the process. This will help you learn from your real estate actions so you may become even better if you sell another real estate property again.

Let's sell another property "For Sale by Owner"

Yours truly,

For Sale by Owner Guy

****

References & Resources:

  * National Association of Realtors®, <http://www.realtor.org/library/library/fg006>

  * _Modern Real Estate Practice in New York For Salespersons and Brokers_ , (Seventh Edition) by Edith Lank, ISBN 0-7931-4363-2, Real Estate Education Copyright 2001, Published by Dearborn™ Real Estate Education, 155 North Wacker Drive, Chicago, IL 60606 – 1719

