Archive for the ‘scams’ Category
New Appraisal Rule Hurts Sellers and Buyer’s, Alike
We have been warning Why 6 Percent readers about the danger of appraisal problems, after the new “Home Valuation Code of Conduct” went into effect on May 1st.
After being in effect for less than 90 days, 90 percent of real estate professionals have reported that they have had at least one sale fall apart, due to the new rule.
One thing is certain. Something is Wrong and the Timing Couldn’t Be Worse. To Read More about Appraisal Problems and Learn What Others Have Done to Correct Them, Click Here.
Thank you for visiting Why 6 Percent. We have saved thousands of home sellers and buyers a lot of money. We can Help You, too, by providing you with the power of the MLS and protecting your by owner status.
Faulty Appraisals Hurt Home Sales
Home sellers and real estate agents have a new worst enemy: inaccurate home value appraisals.
Even as prices begin to stabilize and buyers re-enter the market, the appraisals many banks rely on to approve financing are causing some deals to fall apart at the last minute or forcing sellers to agree to lower prices.
Lawrence Yun, chief economist for the National Association of Realtors, said the appraisal problem is serious.
“Lenders are using appraisers who might not be familiar with a neighborhood or who compare traditional homes with distressed and discounted sales,” he said. “In the past month, stories of appraisal problems have been snowballing from across the country, with many contracts falling through at the last moment.”
Washington real estate agent Jeffrey Tanck agreed. Tanck, with the Czuba Group at McEnearney Associates, said bad appraisals have affected two of his deals in the past three months.
“In one case, a $364,000 condo came in $80,000 less than asking,” Tanck said. “That buyer was using an out-of-town lender who had no concept of this market. Another appraisal on a $317,000 coop came in $27,000 under, forcing the buyer and seller to meet halfway.”
The potential problem inaccurate valuations pose to sales can be seen in numbers that measure pending sales of existing homes. Those represent contracts that are signed but sales that haven’t closed, and are usually considered a more forward-looking gauge of housing sales.
Earlier this month, the NAR reported that pending home sales in April rose for the third-straight month, advancing 6.7 percent from March, with pending sales up more than 3 percent from a year ago. By contrast, closed sales of existing homes in May rose 2.4 percent and remained nearly 4 percent below year-ago levels.
The NAR’s Yun said he sees a danger of a delayed housing market recovery and a further rise in foreclosures “if appraisal problems are not quickly corrected.”
Tanck said part of the problem is too much work and too few appraisers, who he said are in demand right now.
“People are buying, and lenders and appraisers are both busy,” Tanck said. “But lenders should make sure they’re using appraisers with the correct market knowledge.”
Still, many indicators continue to point to stabilization in housing. The nationwide May increase in existing home sales was the first month-to-month increase since September 2005.
A separate report Tuesday from the Federal Housing Finance Agency showed declines in prices moderating, with the average U.S. home price down 0.1 percent in April from March. (All contents of this site © American City Business Journals Inc. All rights reserved.)
Click Here to Read What to Do if you Get a Low Appraisal
Thank you for visiting Why 6 Percent.com. List your home on the MLS, Realtor.com, Google, MSN, Yahoo, Zillow, Trulia, InfoTube.net and other major search engines for $399. Why Pay 6 Percent?? Buyer’s are waiting!!
Lease Options are an Effective to Way to Sell Houses
Few buyer’s, low appraisals and tight fisted lenders are encouraging some seller’s to consider “rent-to-own” options in order to sell their property.
Lease with the option to purchase agreements are effective tools for selling a home. They are ideally suited for “would be” buyers who have financing issues or don’t have a down payment saved. But, before you jump in, educate yourself about the pro’s, con’s and the proper way to draft the agreement.
How Does Lease with an Option to Purchase Work?
-
Generally the buyer pays an up-front fee, usually from $1000 to 5 percent of the sales price. If the buyer completes the purchase, the upfront fee is credited to them at closing. If they do not purchase the home, the seller keeps the fee.
-
Generally, the buyer agree’s to pay extra rent each month. The normal rent is used by the seller to pay the mortgage, maintainence costs, etc. The extra rent is credited to the buyer and lowers the purchase price at closing.
The Pro’s of Lease Options
-
Because the typical contract term is typically from one year to 36 months, it gives the buyer ample time to establish job history, correct credit problems or save for the down payment needed to obtain financing for the home.
-
During the option period, the buyer can lock in today’s reduced price, yet, continue to look at other neighborhood’s, area’s and properties without fully committing.
-
The seller receives cash upfront, the normal rent for the property and extra rent that they can use to offset the costs of ownership. The seller does not have to refund any money, if the buyer doesn’t exercise the purchase option.
-
The homeowner will likely get a tenant that cares more about the property condition than an average renter. Because the buyer has committed their own money and plans to own the home at a future date, it is likely that they will care more about maintenance, upkeep and paying the rent on time.
The Con’s of Lease Options
-
Buyer and Seller need a well written agreement, drafted by a knowledgeable attorney.
-
The Buyer can lose their investment. If they can’t obtain financing by the end of the rental period, they forfeit the cash paid into the deal. If the buyer falls behind on the monthly payments, they lose the extra rent and money paid upfront.
-
The Seller may get the home back, if house prices fall below the agreed upon sales price. The seller can opt to renegotiate the price, but net profits may be lower than if the property was sold now, versus at a future date.
-
Some renter’s have been burned by seller’s who hide the fact they are going through a foreclosure proceeding on the property. After a period of paying inflated “rent” and upfront fee’s, the seller may lose the home to the lender, in which case the tenant will be evicted and lose all the money paid into the deal.
-
Some Seller’s are Foreclosure Scammers. Some seller’s take the upfront money and run, never to be seen or heard from again.
-
If home prices increase, the seller would lose money, if the agreed upon purchase price is lower than the market price. In the case of home price inflation, the seller may benefit from renting the property now and forgetting the option to purchase in the future.
Thank you for visiting Why 6 Percent. We have helped thousands of sellers market their property and keep more of their money. Ask us about our low cost MLS and Realtor.com marketing package for sellers. We can help you reach thousands of buyers every month for $399.
Why Foreclosures and REO’s Don’t Sell
The nation is sitting on over 19 million vacant, abandoned pieces of residential real estate. And, that number is growing. As these homes languish on the market, and prices are further slashed to the deteriment of all property owners, many people are asking, “Why aren’t these properties moving?” We have one answer, but it isn’t very pretty. The answer is Filth.
The ridiculous truth of the matter is that Bank Owned (REO) property is often left in a disgusting condition. And, we aren’t talking about worn carpet or peeling paint. Some of the homes owned by the banks are in such a vile state that no one could ever envision themselves living in them, after taking one step inside. 
Buyers and real estate agents, alike, report that banks place homes on the market for sale with feces smeared on the walls, rotting food everywhere, animal waste covering the floors, and with odors so strong, that they actually stick to people and their clothing hours after the encounter.
As the taxpayers continue to bailout the financial sector, maybe we should demand to know why the banks are allowed to own homes that are in this type of condition? In addition to the fact that no one will buy them at any price, and they continue to drag down the values in otherwise good neighborhoods, they present real health risks for the entire community.
Sellers, do you feel better about your “for sale” competition now?
Thank for you visiting Why 6 Percent. We are the MLS and Realtor.com connection for thousands of owners, builders and investors. Call us at 1-800-381-9496 to reach millions of real home buyers each month!!
DOJ forces Columbia, SC MLS to Stops Unlaw Practices that Hurt Homeowners
The Department of Justice (DOJ) and the Columbia, SC Multiple Listing Service (MLS) have agreed to settle an antitrust lawsuit filed one year ago.
The DOJ filed the law suit on behalf of consumers, accusing the Columbia, SC area MLS of illegally stiffling competition to keep sales commissions and fee’s high.
Some of the charges against the Columbia MLS are:
- The Columbia MLS required all brokers to offer identical services to consumers (ie: full service listings). The intent was to eliminate flat fee MLS and ala carte brokers, whose business model allowed home seller’s to chose services they were willing to pay for.
- The Columbia MLS charged $5000 member initiation fee’s, far exceeding the costs charged by other MLS’s. By raising the initiation dues, the Columbia MLS hoped to make the dues prohibitively expensive for new brokers or for those with alternative business models that charge less for their services.
- The MLS board forced members to use one form for services. This form prohibited home sellers from doing some of the sales work themselves in an attempt to save money.
- The Columbia board required brokers to have a stand alone office, apart from their homes. The ban on home based business kept overhead costs high for brokers operating on a low cost sales model, making it difficult for them to compete with traditional 6 percent brokers.
DOJ Agreement Forces Major Rule Changes in SC:
- The Columbia, SC area MLS agreement “will remove unlawful impediments to competition for real estate brokerage services in the Columbia area and will lead to more choices and lower brokerage fees for South Carolina consumers,” said Christine Varney, assistant attorney general in charge of antitrust at the DOJ.
- The Columbia MLS has agreed to allow membership to any broker in charge, regardless of their business model (ie: flat fee MLS and ala carte services).
- The board must allow home owners the right to choose the services that they want, in order to save money in selling commissions and fee’s.
- The MLS must repeal rules that require a single contract form for service.
- The standalone office requirement has been removed. Broker members can work from home to keep their overhead low.
- The Columbia MLS will allow members from other area’s to use their service and access the MLS data.
Why 6 Percent applauds the DOJ on its win to protect South Carolina sellers and buyers alike. It is a Realtor’s fiduciary obligation to expose a home seller’s property to as many sources as possible, even if they want to do some of the work themselves. It is also the right of every broker to work with consumers in any legal way that they chose. The DOJ settlement should go a long way toward lessening the costs or buying and selling property in South Carolina.
Why 6 Percent has flat fee MLS and ala carte brokers ready to serve home sellers in South Carolina. Call us today at 1-800-381-9496 to learn how to expose your home to thousands of buyer agents and millions of home shoppers each month.
The Truth About Short Sales
A short sale may be the best way for some homeowner’s to avoid foreclosure, but what is a short sale? How does an owner negotiate or work with their lender to avoid foreclosure?
According to Wikipedia: A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.
How should a homeowner negotiate terms for a short sale with their lender? What should they watch out for??
- Seller’s need to know that they will be liable for the difference between the sales price and the loan balance unless they can prove they can not pay it.
- Seller’s should provide documents of financial hardship to their lenders such as layoff notice, medical bills or investment statements.
- Seller’s should check all closing documents for the home for signs of fraud. In cases where questionable loan practices have occurred, lenders will be more negotiable.
- If seller’s have more than one mortgage, talk to the lender in the last position first. They have the most to lose if the house goes into foreclosure.
- Make sure short-sale agreements don’t allow the lender to go after the buyer or seller for the difference at a later date.
- Be motivated to Sell. Provide a Comparative Market Analysis (CMA) or appraisal to the lender. Reassure them that you will take every necessary step to sell the property, if they agree to work with you.
- Always refer legal questions to a lawyer and financial questions to an accountant.
Article of Interest: Beware of Real Estate, Foreclosure and Loan Modification Scams
Thank you for visiting Why 6 Percent. If you are selling by owner, but want to expose your property on the MLS and all major real estate websites such as Realtor.com, we are here to help.
Protect Your Home from Lock Picking and Bumping
A news report revealed some very disturbing information about home safety and security. Or, should we say the lack of it. A new technique called “Lock Bumping” allows criminals entry into 90 percent of American homes in less than 10 seconds.
Watch the short news video to learn what Lock Bumping is, and which locks are “Pick” Proof. The news will surprise you, but it is important that you protect your home and your family today.
CLICK HERE TO VIEW NEWS REPORT
Thank you for visiting Why 6 Percent. Search for thousands of great deals on homes for sale and rent. Or, call us to learn about our real estate marketing program and instantly places your home for sale in front of millions of home shoppers each month, with the simple click of your mouse.
FSBO’s – Stop Annoying Calls from Real Estate Agents
The housing crash is tough on everyone, but it is causing a huge problem for real estate agents. They are making no money and have no business. To make up part of their cash shortfall, they have turned their attention on for sale by owner’s , driving them crazy with cold calls.
Real estate media writers are part of this problem. Widely followed real estate commentators, such as Bernie Ross (good writer) of Inman News, are advising Realtors and agents to cold call for sale by owners in hopes of generating leads in a down market. Her recent article for Inman entitled “Cashing in on FSBO’s”, illustrates why, annoying or not, many agents are dialing your home searching for their next commission check.
Ms Ross advise to Agents :
“In today’s market, expired listings and distressed properties seem to dominate the scene. Nevertheless, there’s another source of right-now business that you can’t afford to miss: for-sale-by-owners (FSBOs).”
If you are selling by owner and find that daily sales calls from real estate agents are disruptive and infuriating, you can take action to make them stop.
-
List your property on the MLS. Agents are automatically prohibited from calling seller’s whose property is listed on the MLS. In addition to eliminating sales calls, the MLS also provides fsbo’s the best exposure and reach needed to sell their home.
-
Add your home and cell phone numbers to the “Do Not Call List“. If you are on the Do Not Call list, real estate agents and telephone marketer’s should not call you, and they can be fined if they do.
Thank you for visiting Why6Percent.com. We specialize in FSBO’s real estate marketing and assist homeseller’s with an MLS and Realtor.com home listings. Call us today at 1-800-381-9496.
Stall, Halt or Stop Foreclosure to Buy More Time
Homeowner’s facing foreclosure have found discovered a very valuable secret that can stall, halt or stop foreclosure proceedings.
How? It seems that many of our banks and lenders are unable to locate the original loan documents which give them the right to foreclose on a property.
If you are a homeowner who is facing a foreclosure action, ask your attorney to demand a copy of all your original loan documents from the bank or lender. If the lender can not produce your paperwork, they can NOT foreclose on your loan.
Thank you for visiting Why6Percent.com. We are here to help you sell your home, as we have helped thousands of others. Call 1-800-381-9496 for all your home selling needs, questions or concerns.
4 Lies and Truths about Real Estate Listing Pitches
Real estate agents often use some pretty scary sales tactics when solicitating a listing. Relax, none of these lies or half truths are as scary as the 6 percent you are guaranteed to lose, if you buy the lie.
The Lies and Truths about Listing Pitches:
Lie #1: If you list with a discounter you will be blackballed and no real agent will show your property.
Truth #1: If your home is listed on the MLS, agent’s can’t determine any difference between your house and everyone else’s. Assuming that they could somehow tell the difference, it wouldn’t matter anyway. The only thing agents care about is their commission. If they refuse to show your home, they run a high risk that the buyer will look without them and they earn nothing. In truth, the only agents who spin the blackball story are listing agents, who are having a hard time scoring a 6 percent fee and those don’t normally work with buyer’s anyway.
Lie #2: Our office has a lot of buyers referred from relocation, so your odds of finding a buyer are better if we list your house.
Truth #2: This is crazy for a number of reasons. First, agents make the same commission no matter which home someone buys. Relo buyer or otherwise, agents have absolutely no higher incentive to sell a home they have listed, than any other listings in the MLS. A great way to turn the tables is to ask, “My home is on the MLS and we are offering a commission on the sale. If you have so many buyer’s, why haven’t you shown our home?”
Lie #3: I constantly network with other Realtors, so I will pitch your house to all of them.
Truth #3: This is a joke, right?? Get real. The only agent’s who “network” are agents with no customer’s. They have nothing but free time on their hands, so they hit all the coffee clatches and free martini lunches in an effort to look busy. Agents with real buyers use the MLS to find suitable houses, they do not find homes for sale by word of mouth.
Lie #4: I will host an Open House for you and send mailers to all your neighbors.
Truth #4: Yawn!! The real truth is that agents should thank seller’s who allow them to hold an Open House because it is one of the only means they have to meet buyers and potential clients (ie: your neighbors). Agents could care less whether someone they meet at your open house, buy’s your home or not. Their concern is about impressing potential business clients, hoping to generate a commission somewhere down the road. (Holding an Open House is also a great way for agent’s to look busy in an attempt to justify that 6 percent commission.) The real truth is that anyone who is excited enough to buy a home during an Open House would have scheduled a showing after seeing a yard sign or InfoTube brochure, anyway. Don’t buy into this one, sitting at an Open House isn’t rocket science and does little for home seller’s.
Smart seller’s should remember that scare tactics aren’t real and paying 6 percent of your sales price to an agent is not what sells homes. Selling a home takes patience, proper pricing and a lot of internet exposure, which is something we can all do with the click of a mouse.
If you are serious about selling your home and making the most money possible, put a sign with an InfoTube in your front yard and get a listing on the MLS and Realtor.com today. These are the only tools that really sell property.
Phone us at 1-800-381-9496 or email to haline@why6percent.com and start showing and selling today.