Gary White~ Grand Rapids Real Estate, FlexIt Realty, a call or click away!

We had a major headline this week that put appraisers on the defensive. Well some of them...because they felt a bit exposed. Michigan hit another dubious milestone as the 5th worst state for appraiser fraud.

Let me see....if you have mortgage fraud do you think someone else in the food chain has to help make it work on paper?

One of the interviews went like this....we are under tremendous pressure to hit a number to make the loans work. What? I was stunned to hear that statement....anyone listening?

What the appraiser was saying is the lenders are pressuring him to hit the loan number so they can issue a loan. Then a loan officer says....Realtors are putting pressure on loan officer to make loans so they can get a sale for their clients.

OK....where is the checks and balances here? I don't call an appraiser and say can't your do better with the numbers? Heck, I rarely know who the lender has chosen to do the appraisal unless they call me for help with comparisons.

Do I ask the lender if they have alternatives if the property doesn't appraise? If my client wants the property and they ask me to see if I can find a solution...I talk with their lender. I rarely get involved at all with the lending process or the approval process other that offering some recommendations for the buyer to pick from.

I do know that some Realtors are very aggressively involved with the loan process. That is up to them...I am not going to venture into the RESPA territory. I do not offer interest rates or loans. I do not do appraisals either.

So if someone else decides to bend the rules and I do know about it and I am certainly not a party to it...I have a clean conscience and so does my buyer. I don't like that they did it. I don't like that they implecated me and my buyer by default by just having us involved with the loan and closing.

Bending the rules to get more income isn't going to make it better for the buyer. If the appraisal comes in lower than the purchase price offered we need to look at lowering the sell price! That's the number...I didn't come up with it, my buyer didn't come up with it. The alternative is if the seller won't adjust the price is...the buyer can put more down out of his pocket to make up for the difference for the appraisal price and the purchase price.

Nothing illegal for a buyer to pay more than the appraisal. Also nothing illegal about the seller lowering the sell price to meet the appraisal or to negotiate a split in the difference.

I should also mention that I know some very ethical appraisers that would rather have less business than bend the rules to hit a lenders number when they were asked. That has hurt their lender business but has also gained them a very professional reputation within the financial community.

The industry has been plagued with these issues for years...someone just wrote about them. It is kind of like finding out where the cold comes from...everybody gets them...and nobody likes it.

Has anyone ever gone out of their way to hit a number for you? Change your purchase price or sell price to meet a number?

Dower Rights, would you like to give up your claim to Dower Rights?

This week I had an agent make a unique request. The agent wanted a release form for Dower Rights. I said are you sure you want that form? Why would a woman give up her legal claim as in half (50%) ownership in anything?

The situation is based, in this case, on emotional issues. The home that is to be listed is was the ex-wife's along with her new husband. The current wife wants nothing to do with anything the ex-wife was remotely involved with or tied too in any way shape or form.

My agent did a very good job explaining Dower Rights but it fell on deaf ears....the spouse wants off the contract and to have nothing to do with the property. Now that creates two little problems. Easy for me to say, little problems.

1. There isn't a form for releasing your Dower Rights....well there wasn't, there is now.
2. The legal issues of releasing your Dower Rights has to be weighted and the form has to protect the company, agent and the spouse that is releasing her rights.

Here is some of the issues that may not seem important at the time when emotions are taking over. So it is up to the broker to make sure the form meets and exceeds the best interests of clients, agents and his/her company.

• If you release your legal interest in the property and something happens to the husband you have no legal standing to the property. You have released your rights.
• Making the form situational so it only covers this specific transaction and reverts back to the releasing spouse should something happen. (Which this spouse demanded be removed)
• Making sure the releasing spouse knows she can consult an attorney before signing and having an area on the form which the spouse can waive this right.
• Making sure the form is witnessed by someone other than the spouse for whom the release is made.
• Making sure the form is signed and notarized in front of a notary.
• Make sure to provide a space for the notary to imprint the notary seal.

Since this was an emotional request, I wanted to cover all the bases including offering to meet to explain the rest of the issues of this decision.

what do to and how to handle unusual issues comes with the task of running a brokerage. The other side of this is making sure you offer as many options to clients so they make an informed decision.

Have you had any unusual requests?

The Internet has given may buyers and sellers the thought that they can buy and sell without a Realtor. Well the truth is they can....the other truth is they also take on all the liability for the paperwork, proper disclosures, negotiating the sale and purchase price and any errors and omissions accidental or not.

If Realtors get sued and they know the rules, regulations, laws and employ professionals to help them close the sale how do you think you will do without training?

It looks simple. Put a sign in the yard and wait for a buyer to find you. Well that used to be the way it was. The Internet changed all that. So now you find the lowest priced Internet listing company and put up a few photos and a sell price and wait for buyers to find you?

Well if it were that simple every Realtor with a website would be selling homes everyday. So that is one part of the puzzle, the Internet. But to be sure marketing of homes is a moving target and even the best of marketing specialists are sometimes puzzled by which method to use to sell and attract buyers.

It only takes one law suit or missed statement on a form to wipe out all the perceived profits that could have been gained by selling on your own. It could cost you your home and jail time if you do something wrong intentionally. The other little issue never mentioned is you probably will end up selling for 6-8% less than if you used a Realtor. The reason buyers think you have room to play you are not paying a Realtor.

I truthfully don't mind sellers selling on their own. In fact one of my companies promotes sellers to do just that, sell without a Realtor. Of course I have another company that is a full service real estate company. Do I find these two companies in conflict? Not at all, my goal is for sellers to sell and buyers to buy. So I take my job very seriously....and I provide all the options possible for sellers and buyers to meet their goals.

I have workshops to help them understand, I offer printed guides to explain key topics. I provide tools to help sellers and buyers meet their goals. Do I think it replaces a Realtor representing buyers and sellers? NO. Do I think that some buyers and sellers can do this without a Realtor? Of course.

Some people have sold properties and purchased properties and have become very proficient at it. They also hire key professionals to help them. Some of the professional investors have learned the hard way that their is no substitute for a professional.

I replace my doctor when I remove my own stitches...which I started doing in a war zone years ago and feel like it is my badge of courage to keep the effort up. If I would ever get an infection...guess what, I would be off to the doctor and tell him I took my own stitches out and look what happened. Will he be happy...NO...will he still treat me...YES and he will charge me too!

So when a seller or buyer makes a mistake or gets himself into a mess guess what...they call a Realtor for advice. Will most still help them? Yes...some won't but that is because of the liability. You see when a Realtor is handling your representation they know what to do in each case and if they don't they have a backup knowledge base...the broker who helps them. When you make a mistake you pay an attorney or you call a professional and you pay them...and sometimes it costs more to correct your mistake.

So if you can imagine a world without a plumber, electrician or carpeting installer...then you probably can imagine a world without Realtors. Consider how many transactions would end in law suits, how many transactions would be lost because of misunderstanding, how many transactions would not close on time?

Without our system of exposing property for sale how would you know which homes are really for sale? I manage my businesses so you will be exposed enough to have some working knowledge to meet your goals.

Now consider this...the Internet has 60 million new pages added to it every day! The pages that were added 3 years ago in most cases are still floating around on the Internet...that does not mean they are accurate. But you might think they are if you never looked at the date they were entered on the Internet.

So just like newspapers you cannot believe everything you read on the Internet. Just like your world would not be the same without a professional or career Realtor that can help process, interrupt, assembly and present information in a manner that helps you meet your goals.

That's may take what is yours?

Choosing the right Realtor®

Does experience matter when choosing a Realtor?

National statistics tell us a different consumer story. Consumers look at very few things about the Realtor® they choose to represent them when going through the selection process.

They, sellers and buyers, look at physical presence and usually do not consider company image...what your body language says to them when you meet for the first time is a key factor. In fact studies show that we as humans make up our minds in the first 15 seconds if we like others or not. So does that smile or gesture make a difference? Does a warm firm handshake or a clammy palm tell you anything about the other person? Does dress express how they will treat you or your listing if you ask them to sell your property? The evaluation process is usually circumvented because the consumer has gotten the Realtor® name as a result of a referral from a friend, relative or co-worker. The process does become more involved if the Realtor is selected based on advertising or phone book.

Well those are personal issues they have nothing to do with selling your home. Yet it is usually the first Realtor a seller meets, over 60% percent of the time, that they chose to represent them in selling their largest asset.

Here is a few thoughts that may give you a reason to do a better job interviewing....I did say interviewing your next Real Estate agent before you hire them. Many sellers do not think they are hiring an agent when they sign a relationship contract or a listing contract. The reason they don't think to much of it is simple....they are not paying anything out of their pocket at the time of the signing of the contract in most cases.

Do you think the process would be different if you as a seller paid for services upfront? I know I would have to do a bit more homework before I handed anyone a bunch of cash. Well in essence that is exactly what you are doing. You are handing over your largest asset to a person you have just met.

What would you normally like to know before you purchase a service?

•1. How long have they been in business?

•2. What type of marketing programs will be used to promote your property?

•3. What type of communications can you expect?

•4. Have they sold any properties like yours?

•5. Have they taken the time to gain additional real estate education? If so
what areas? Why use a residential Realtor® to sell your commercial
property or vice verse.

•6. Do you feel comfortable with them...to represent your largest asset?

So before you list with the first Realtor you meet even though you may not be handing them cash right then...you're entrusting them with your largest single asset. Not to mention your future hopes and dreams.

FlexIt Realty, "only a call or click away"!© 2006 If you would like to sell your home and it is not under contract with another agent or brokerage or your listing has expired and you still want to sell Call Toll Free: 877-667-4699 or Email: garywhite@grar.com go to our web site www.FlexItRealty.com to find over 30 Free Reports that could save you thousands of dollars in your next real estate transaction.

The number one mistake made by sellers is pricing their homes to high for the market. This is the number one mistake by FSBO sellers too.

Everyone including me thinks our home is worth what we paid for the home and then look at all the things we have added. The truth is in Michigan in our market we have seen declining values in the marketplace.

The state equalized value to protect us from rising taxes has also stopped or slowed our Michigan home values from dropping further, on paper, than what sales dictate. The reason I say on paper....how many of you have heard the phase, "it isn't worth the paper it is written on"? Well in this case your taxable value and the real value of your home can be much different and to believe your tax bill as to true value of your home is just a feel good document. It really has nothing to do with your value other than to give you some guidance toward value.

So when you set the sell price of your home how do you do it? We have several ways to work together to get your home sold but the price is by far the number one issue. So focusing on price alone is all we are going to do.

1. Price, is the number one motivator to get buyers to act. I did not say you have to be the lowest priced home. If you were you would sell first! Other factors below impact price as well. But price dictates showings. Price dictates offers. Price dictates time on market, how long it will take to sell your home. Pricing your home correct is the primary element to selling faster for more money!
2. Location, this can be a plus, minus or neutral factor. If your location is in the "hot zone" great schools, close to shopping at the newest or best mall, expressway system or "the place to live" according to the most recent sales statistics it could mean more selling dollars. So Location is part of the sell price equation.
3. Condition, if you homes maintenance has been kept up to date and there is nothing to do your value is going to be higher than the same home that has to be painted, or needs landscaping, a roof, furnace or hot water heater. So condition is part of the sell price equation too.
4. Marketing, letting buyers know your property is for sale is listed last on the list because without evaluating the first three items and setting the sell price right all the marketing in the world will not sell your property.

So what can you do if your home or property is not selling? Look at the market and the competitive homes or properties that you are selling against. Look at the market as though it was your first day of selling. Your first time setting your sell price. Be objective like you are the buyer. Look at what has sold. Look at what is pending and look at your property and the others comparable to yours and see how they stack up with Price, Location, Condition and Marketing.

Make sure you really want to sell. If your attitude is this is my price and if someone offers me "my" price I'll sell. You could be in for a long listing and selling time frame! Most Realtors will not want to spend advertising dollars on a property that is priced to high and/or waiting for "Your" price. Why should they? Would you if you were in business? Remember real estate is a business. How real estate businesses prosper is by selling property. The reason you call them or use a selling service is because you think they can help you sell your property. So restricting the possibility of selling by pricing to high is going to limit your marketing to only those less experience who are hoping you will change your mind. The more experience Realtors will tell you straight away your price is to high. The other thing we do is tell you the truth!

Don't look at your sale from a seller perspective. Look at it from a buyer perspective. Review your competition even tour the competitive properties if you have questions or doubts. Then set your sell price competitively within your market. Competitively priced homes and properties sell faster and for more money. How do they sell for more money? Simple they don't have to go through price reductions to get to the right price to attract buyers. The other higher priced properties have dropped too which mean you have to go lower than you would have if you priced correctly in the beginning.

Hope this helps you understand the pricing concepts.

If you live in Michigan and are not listed or your listing has expired and you still want to sell give us a call. We will help you sell. We have 5 locations around Michigan to serve you.

Call Toll Free: 877-667-4699
Email: GaryWhite@grar.com

Visit our web site www.FlexItRealty.com to review over 30 "Free Reports" that could save you thousands of dollars in your next real estate transaction.