One of the most frustrating things about trying to sell your house in a buyer’s market is taking a look back two or three years and seeing what your neighbor got for his house, and trying to come to grips with the fact that you’re probably going to get less even though you have a finished basement and a custom patio…two thing that he didn’t have.

While it’s true that in a seller’s market these upgrades will probably put more money in your pocket, in a buyer’s market they have value as well. It may be a little more difficult to see, but here’s how it works.

You live in a beautiful suburban neighborhood that consists of about eighty-five single homes. Two years ago when a ‘for sale’ sign went up the house was sold within two weeks, and now there are eleven houses that have been on the market for around forty-five days. More than likely they’re all priced within a few thousand dollars of each other, and someone looking to move into your community has plenty of houses to choose from priced between $400,000 and $410,000. It’s right about now that you should be feeling better about that finished basement and custom patio.

You see, with all other things being equal, buyers will look to get the most for their money, meaning, that given the choice between several properties all within the same price range…ninety nine percent of the time they’ll take the one that offers the most options for the same money. So although in this current market your upgrades might not get you more money than your neighbor, you’ll probably receive an offer before a similar home does because they do not offer those amenities.

Posted by Frank Dowd

Every time I turn around I see this offer, “Your house sold in thirty days guaranteed, or I’ll pay you $1,000 cash”. What a generous offer…how is this real estate agent able to make such a guarantee?

Well, if you guessed that they can’t guarantee that they’ll sell your house in thirty days, you guessed right. You see as with most ridiculous offers that many American consumers fall for day in and day out, the answer is in the fine print. Basically what you’re being offered here is a $1,000 rebate. The real estate agent in this case is probably charging you a commission of 6% or more, and then, if the house doesn’t sell in thirty days he/she will drop-by with your $1,000 check, right?

Wrong! If you read the fine print, you will find that this real estate agent is not obligated to pay you the $1,000 until he sells your house. At that point he will rebate $1,000 of his commission to you. If he/she never sells your house…then you never get your $1,000. How’s that ‘great deal’ sound now?

Posted by Frank Dowd

Have you either bought a new home or refinanced an existing mortgage lately? Who picked the title insurance company–your real estate agent or your lender? Were you charged the basic rate, reissue rate or the substitution rate? Do you even know what that means?

All good questions and if you don’t know the answers to the last two you may well have paid too much for your title insurance. Some of you might say “who cares”, but I’d like to speak to those of you who would rather put that $300 to $500 or more in your pocket rather than into a stranger’s.

For many people title insurance, title insurance premiums and the fees associated is this great mystery that few people seem to understand. Unfortunately, for the consumer, this often leads to paying too much for these services. CompareMyAgent.com offers Pennsylvania residents a title insurance calculator that eliminates all of the confusion. You’ll know exactly what the title insurance premium is for your purchase/refinance, and then it gets even better…our affiliates will waive the ‘miscellaneous fees’ that are being charged by your real estate agent or mortgage lender’s in-house title company.

We provide you with straight answers, exceptional service and a great deal that will save you hundreds of dollars. What could be better than that?

Posted by Frank Dowd

For many people the most difficult part of selling a house is negotiating the commission with a real estate agent. Although commissions are negotiable, often times consumers feel intimidated when a real estate agent insists that he/she will only work for 6% or more.

Next you might hear something like this: “I charge 6% commission, however, if it turns out that I find the buyer for your property as well I’ll only charge you 4-1/2%. Not bad…on a $300,000 house that would save you $4,500 in real estate commission. The problem is, the likelihood of your listing agent procuring the buyer him/herself for your property is highly unlikely. Does it happen? Yes, occasionally, but not very often.

Chances are that once your house is listed on the MLS (Multiple Listing Service) it will almost surely be another real estate agent that brings you the offer that you ultimately accept. A better suggestion might be to ask the agent to accept a reduced commission if the property were to sell within the first thirty days. Typically when a house sells quickly the agent has not had to put a lot of time and/or resources into marketing your home, so a discounted commission in this scenario might be in order. The key is to be reasonable, and if you feel that you’re the only one negotiating…move on, there are hundreds of real estate agents who would love to get your business and would do a great job as well.

Posted by Frank Dowd

Getting ready to sell your house and not really sure how the whole commission thing works? Here’s what you’ll need to know.

I’ll assume that you’ve already selected a real estate agent to list your property for sale and you’ve set the sale price. Depending on current market conditions, you’ll probably agree upon a rate of commission somewhere between 4% and 6%. For this example, let’s split the difference and say you’ve agreed to pay a 5% real estate commission.

The listing agent (your agent) will offer to pay a portion of that 5% commission (usually half 2.5%) to another real estate agent (usually referred to as the cooperating or buyer’s agent) who brings a qualified buyer with an acceptable offer. In this scenario the listing agent (your agent) and the buyer’s agent would split the 5% commission, but it doesn’t always work that way. More and more we’re seeing listing agents who will offer the cooperating agent a 2% commission and keep 3% for themselves. From a seller’s perspective, this is not in your best interest, especially in a buyers market where the buyer’s agent has plenty of other homes to show his/her client. When you negotiate the commission for the sale of your house, make sure that you’re on the same page as your real estate agent and you have a clear understanding as to how the commission is going to be paid. Your agent may try to tell you that it shouldn’t matter to you how he/she ultimately distributes the commission, but the impact of their decision might cost you time and money.

Posted by Frank Dowd

Here’s the situation: you’ve sold your house and entered into an Agreement of Sale on a new home. The buyer for your existing home has a mortgage commitment, the home inspection went well, now all you need to do is sit back and wait for the settlement date to get here. A few weeks go by and you get a call from your real estate agent who tells you that the buyer has decided not to buy your house. What now? You’re in a panic because you can’t buy your new home unless you sell your current home…will you lose your new house if you can’t get to settlement on the agreed upon date?

The scenario that I described above happens more often than you would think. Buyers sometimes get spooked when they start thinking about the monthly mortgage payment or a family member tells them that they’re making a bad decision…could be a number of different factors at play. One thing that you could do as the seller to help avoid this ‘buyers remorse’ is to require that the buyer put down a large enough deposit so that it would be more difficult for him/her to walk away and give up their deposit. Even if it’s an FHA insured loan where the buyer only needs to come up with four or five thousand dollars of their own money to buy the house, make sure that they put that money down as a ‘good faith’ deposit. I can’t tell you how many deals I’ve seen fall apart over the years where the buyer walks away with only a $500 deposit on the line. And if the buyer refuses to give you a larger deposit up front? Well, now you have a tough decision to make and in a buyer’s market it’s not always an easy one.

Posted by Frank Dowd

Mary Smith graduated college and soon after finding a job, she bought a small suburban 3 bedroom, 2 bath house on a quiet street. Two years later Mary was married to Mike Jones and the happy couple is now looking for a bigger house with a large back yard for the children that they’re planning to have.

Mary, now known as Mary Jones, is in the process of selling her house when someone at the title insurance company notifies her that her husband Mike needs to sign off on the deed even though he’s not on the title to the property. Why is this?

In the Commonwealth of Pennsylvania the non-titled spouse is required to sign off on the transfer of the deed to acknowledge that he/she is aware that the property is being sold, and therefore is surrendering any rights or claims that he/she might have to the property…even though their spouse may have purchased the property before the two ever met.

So if you find yourself in this situation, try not to get irritated with the messenger…a little cooperation from you and your spouse will help to insure a smooth transaction.

Posted by Frank Dowd

Can I see a show of hands…how many homeowners out there are a nervous ‘wreck’ because your mortgage interest rate will be adjusting in the not so distant future?

Even if you still have a year or so left with the lower rate, it’s probably a good idea to start looking for an opportunity to refinance now. Maybe your rate will be a little higher, but maybe not. For those of you who are a little adventurous, consider another 3/1, 5/1 or 7/1 adjustable rate mortgage. The rates are still very attractive and you’ll buy yourself a few more years to decide whether you’re staying in your current home or moving on to bigger and better or smaller and maintenance free one.

For those of you who try to avoid excitement, stick with the 30 year fixed rate mortgage…you’ll probably see your payment increase a little, but it’s only one time and you’ll be good for the next 30 years.

Last thing, don’t procrastinate…if you sit around waiting for the rate to hit 5 ¼%, you might wind up with your current rate adjusting to 7 ½ %.

Posted by Frank Dowd

This is a question that can be answered by asking yourself one simple question, will my family be able to stay in our home and maintain the same standard of living if either me or my spouse pass away unexpectedly?

For most young families the answer is no. Unfortunately not many of us plan for tragedy to strike in our early years, but it does happen more often than you think.

Mortgage Protection Insurance is basically a form of term life insurance known as decreasing term insurance. Frankly, it’s typically very expensive when you compare to a regular level term life insurance policy. While I would suggest that everyone who has a mortgage purchase life insurance to cover the outstanding balance on your mortgage to protect your family’s future, I would recommend a simple 10, 15 or 20 level term insurance policy (obtain it through your insurance agent) instead of the decreasing term policy offered by your lender. With the traditional level term policy both the death benefit and annual premium will remain the same for the entire term of the policy…and you’ll probably pay about half the price of the product that’s designed specifically for your mortgage.

Posted by Frank Dowd

If I were in a situation where I needed to request that my lender accept a short sale to avoid a financial disaster, I would do my best to make sure that I was able to squeeze every last dollar out of the transaction.

Remember, although the lender is accepting an amount that is less than your payoff amount in an effort to complete this transaction, you will probably still be on the hook for the remaining balance at the end of the day. Therefore, the amount of commission that you’re paying the real estate agent does matter…and the seller credit to the buyer…that matters too. The lender may approve these expenses, but it ultimately reduces the amount the lender receives and increases the amount that you still owe.

Bottom line, keep a keen eye on your expenses. Some may suggest that it’s the lender who’s getting the ‘haircut’, but in most cases the lender tacks the loss onto the seller’s outstanding balance.

Posted by Frank Dowd