Since the real estate shake out, the world of lending has changed tremendously. Previously, everyone was a mortgage broker or “mortgage banker” if you were high-falutin.
Storefronts for independent mortgage brokers opened faster than Budweiser stand at a NASCAR race - appeared faster than ice cream trucks on a sunny day.
Since that time, there has been a contraction in the number of lenders (Countrywide being purchased by Bank Of America, for example), increased regulation of individual brokers and a drop in the number of mortgage applications. This has had the combined effect of forcing many people from this industry.
As a group, lenders suffer from a lack of transparency; unlike real estate agents, they have a less of a public presence (no pictures on billboards) and tend to work behind the scenes.
Many lenders and mortgage brokers get referrals from real estate agents, rather than directly from potential clients. Working with a lender/mortgage broker recommended by your real estate agent is not necessarily a bad thing. Real estate agents have an obvious interest in seeing a transaction close and increase their odds by working with mortgage brokers who have a track record of getting deals funded.
Before, the economic reset, having transaction close successfully this was less of an issue, however, with tighter underwriting and appraisal standards, working with someone who can get a transaction financed is now more important than ever.
Wednesday 19 June 2013
Tuesday 11 June 2013
Your real estate broker is not your investment strategist
Be clear about what your real estate agent is supposed to be doing for you. Many real estate agents freely offer advice (maybe too freely). They can be a great source of information about local market data (time on market, closed transactions, sold price vs. asking price, etc.) However, once you get out of these topics, you are swimming in the deep end of the pool.
Asking “how’s the market”, “is this a good time to buy” or other open ended questions of this type is non-productive. Real estate agents simply don’t have the skill set to address these issues.
Remember - your real estate broker is not your investment strategist.
Asking “how’s the market”, “is this a good time to buy” or other open ended questions of this type is non-productive. Real estate agents simply don’t have the skill set to address these issues.
Remember - your real estate broker is not your investment strategist.
Tuesday 4 June 2013
This is not a dress rehearsal - how to ask the tough questions
When it comes time to hire your team of BuildSmart professionals, remember: This is not a dress rehearsal - you need to ask some tough questions.
Don’t hire someone just because they showed up. Instead, engage them with detailed questions to verify that their background matches your needs and expectations. The following, are a set of questions to ask when interviewing prospective service providers. This is not intended to be a script, rather a way to methodically find out if these people have the appropriate knowledge and skill set to add value, etc.
Real Estate Agents
How long have you been an agent?
From an absolute sense, more experience is better. Most people don’t realize that it takes determination to keep a real estate transaction together. For instance, aggressive offers from a buyer are often rejected out of hand by unrealistic or uncooperative sellers. An experienced agent can present an offer in such a way that this doesn't happen. In a competitive, multiple-offer situation, a newbie agent might not have the expertise to get your bid accepted.
That said, experience can be a double edged sword, many of the experienced “war horses” in real estate can be frustrating to deal in a different way. Often these agents have an “I know better that you” attitude or never give you their full attention, since they are already focused on their next client and next transaction.
BuildSmart tip: Select a real estate agent based their experience, plus your assessment of their attitude.
How many transactions have you closed this year?
The industry standard for closed transactions is probably 8-12 a year for full time agents and 4-6 for part-time agents. The importance of the number of transactions, is that it shows how engaged they are in the market. More engagement means their understanding of the local market conditions will be fresher and more relevant. Make sure they have closed the industry standard amount of transactions decision based on the amount of closed transaction they
BuildSmart tip: Select your real estate agent based on number of transactions they have completed in a measurable period.
Do you usually represent buyers or sellers?
Over the course of a year, most agents will represent both buyers and sellers. Who you choose to work with depends somewhat on whether you are buying or selling. For the purposes of this post, we're assuming that you're a buyer.
In general agents that represent buyers (buyer’s agents) tend to hustle a little more. It takes more efforts to help your buyer identify and evaluate the home than just listing it. That said, this is a less critical than other factors.
What is your knowledge and experience in the distressed home market?
It’s important that whoever you work with has direct knowledge of the distressed properties discussed in this blog. Many of these homes, and programs will be unfamiliar to many agents, so choose an agent who has direct knowledge and experience with these transactions
These are just a few questions you want to be ready to have answered when its time to work with a real estate agent. BuildSmart can help you every step of the way. Contact us today to learn more.
Don’t hire someone just because they showed up. Instead, engage them with detailed questions to verify that their background matches your needs and expectations. The following, are a set of questions to ask when interviewing prospective service providers. This is not intended to be a script, rather a way to methodically find out if these people have the appropriate knowledge and skill set to add value, etc.
Real Estate Agents
How long have you been an agent?
From an absolute sense, more experience is better. Most people don’t realize that it takes determination to keep a real estate transaction together. For instance, aggressive offers from a buyer are often rejected out of hand by unrealistic or uncooperative sellers. An experienced agent can present an offer in such a way that this doesn't happen. In a competitive, multiple-offer situation, a newbie agent might not have the expertise to get your bid accepted.
That said, experience can be a double edged sword, many of the experienced “war horses” in real estate can be frustrating to deal in a different way. Often these agents have an “I know better that you” attitude or never give you their full attention, since they are already focused on their next client and next transaction.
BuildSmart tip: Select a real estate agent based their experience, plus your assessment of their attitude.
How many transactions have you closed this year?
The industry standard for closed transactions is probably 8-12 a year for full time agents and 4-6 for part-time agents. The importance of the number of transactions, is that it shows how engaged they are in the market. More engagement means their understanding of the local market conditions will be fresher and more relevant. Make sure they have closed the industry standard amount of transactions decision based on the amount of closed transaction they
BuildSmart tip: Select your real estate agent based on number of transactions they have completed in a measurable period.
Do you usually represent buyers or sellers?
Over the course of a year, most agents will represent both buyers and sellers. Who you choose to work with depends somewhat on whether you are buying or selling. For the purposes of this post, we're assuming that you're a buyer.
In general agents that represent buyers (buyer’s agents) tend to hustle a little more. It takes more efforts to help your buyer identify and evaluate the home than just listing it. That said, this is a less critical than other factors.
What is your knowledge and experience in the distressed home market?
It’s important that whoever you work with has direct knowledge of the distressed properties discussed in this blog. Many of these homes, and programs will be unfamiliar to many agents, so choose an agent who has direct knowledge and experience with these transactions
These are just a few questions you want to be ready to have answered when its time to work with a real estate agent. BuildSmart can help you every step of the way. Contact us today to learn more.
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