Please note that some of the figures used in our examples will vary depending on the state or county a house is sold in, as well as the settlement company used and any other unique provisions that may be contained in a contract of sale. Additionally, the real estate broker commission is typically 6 percent of the sales price, but it is not a set amount.  It is a sales expense negotiated between individual sellers and brokers.   For the purposes of our example, a $250,000 sales price was used.

 Transfer taxes

As you might expect, most state and local governments make sure they profit when someone sells a house.  In most states, one-time transfer taxes will be due when a sale takes place.  It is customary for transfer taxes to be split 50/50 between the buyer and the seller, but there is no set requirement that they be divided in that manner.

Some states, like Alaska, Idaho, Indiana, Mississippi, Missouri, Montana, New Mexico, North Dakota, Oregon, Texas, Utah and Wyoming, have no transfer taxes at all. In other states, Colorado for instance, the transfer tax is nominal – the state charges only one tenth of 1 percent ($40 on a $400,000 house) in transfer taxes. The so called “Free State” of Maryland falls on the other end of the spectrum with some of the highest transfer taxes in the nation.

Commissions

As we stated earlier, real estate commissions are not a set amount. They are a point of negotiation between the seller and the broker. For illustration purposes here, we are using 6 percent, or $15,000 on a $250,000 sale.

Another seller expense you may run across in some area’s is a listing broker administrative brokerage commission.  It’s usually adds another $250-$500 expense on top of the 6 percent commission fee.  The seller will see it as a separate expense on their closing statement.  So, what is this fee for? By law, brokers must keep records of all their real estate transactions for a period of years. And they must produce those records if asked for them.  Although it’s a ridiculous added on fee, the listing broker administrative brokerage commission is an expense passed along by some brokers to help defray the cost of this requirement.

Settlement fees

The buyer is responsible for hiring the settlement or title company to perform closing, so the buyer will usually pay most of the fees associated with settlement. But, the seller does have some settlement expense.  If the seller has an outstanding loan on the property, the settlement company will take care of paying that loan off out of the sales proceeds. They’ll charge something for the service, plus the cost of overnight fees to quickly get the loan payoff to the mortgage holder. In our example here, we’ll use $250.   And, since interest in collected in arrears, the seller will be responsible for any interest charges that accrue after the last payment thru the day of closing.

The Bottom Line

If you sell your house for $250,000, you can probably expect to walk away with around $230,000 after taxes, commissions and fees.  If no real estate commissions need to be paid out, the seller could expect to walk away with approximately $245,000.  The real number will depend on exactly what it says in the sales contract and where the property is located.

Thank you for visiting Why6Percent.com.   We help do-it-yourself home sellers market their home to millions of home shoppers every day.  We can help you get the word out about your home, too!!

Why Replacing Your Windows Pays Off…

1. New windows improve the curb appeal and increase the value of any home.  
2. Buyers pay up for new windows.  Numerous studies show that home sellers recoop 90+ percent of the costs for window replacement at the time of sale.
3. Homeowners realize the energy savings immediately, while increasing comfort.
4. Energy efficient windows are a Green home selling feature. 
5. New models of windows are easy to clean and maintain. 
6. Improve your view.  New glass is so clear it’s just like looking through… nothing at all. 
7. Maybe Best of All…Uncle Sam Pays for It.   The government will pay 30 percent of the cost (up to $1500) to replace the windows in your home through December 31, 2010.  And, don’t forget to check out the additional rebates and savings on windows that are being offered in most states, cities and townships.

Tip for a Tight Budget

1. Just replace some of the windows.  Choose the ones on the front of the home, because they improve the curb appeal.  Or, replace the windows that get hammered by the most weather, be it sun, rain, snow or wind. 
2. Or, Roll the Dice…and, maximize the tax credit by replacing half of the windows in 2010.  Then, gamble on an extension of the credit into 2011 and replace the other half.
3. Uncle Sam picks up a Third of your bill and smile (:

Practical Advice About Window Replacement

1. Use a company that carries a wide range of window brands.  Make sure they use their own employee’s (not subcontractors) to do the installation.
2. Profit from the Housing Crash.  Be a hard negotiator and get at least 3 quotes.  You can save Big on labor and materials because the housing market is slow.
3. Replacing windows is a big, messy job.  Cover up anything important such as electronics and furniture.  Sawing and Ripping out windows is dirty business, no matter how good the installer.

Thank you for visiting Why6Percent.com.   We have a program for home sellers that offers the MLS, Realtor.com and advertisement on dozens of real estate listing posts for one cheap price…and the seller keeps the commission.  Call 1-800-381-9496 or visit http://www.why6percent.com today for the details.  You will be happy that you did!!!

Why?  Interest rates are rising.  Job losses have slowed to a trickle.  Factory and Industrial output is up for the first time in years.   And, we feel that the Fed is holding back information, for now, on the job creation that is happening as we speak.

So, where are the best real estate deals in the country??  We have identified 10 cities that are offering up Trump-type deals of a lifetime.   CLICK HERE to see where the action will start first.

If you haven’t placed your property listing on the MLS, Realtor.com, Zillow, Google, MSN, Military.com and all the other major real estate websites…you are missing buyers.  Go to the Why6Percent.com website and sign up NOW!!Don’t wait a minute longer.  Tax Credits, Rising Rates and Gutted Home Prices are creating a stir among buyers early this spring.  You snooze…you lose…  And, we certainly don’t want that.

Depending on where you live, you may have never experienced a winter like this one.  I know I haven’t.  Week after week, snow, rain, mudslides and/or freezing temperatures have pounded the country.  With only 1 state out of 50 snowless, it’s easy to see why no one is attending Open Houses… Fortunately,  with February nearly over,  the crocus will soon appear and we predict that homebuyers will hit the streets enmass.  

Home Sellers Get Ready.  The nasty, record setting winter certainly put a halt to home sales, but the upside is the pent up demand it created.  People who expected some typical, nice days to tour homes after the holidays, have  found themselves stuck inside with nothing to do but watch HGTV and dream about buying a home.  We predict these stir crazy buyers will hit the streets at the first opportunity. 

$8000 Reasons to Motivate this Spring.   The $8000 tax credit for homebuyers expires in 43 Days.   To cash in on the lucrative tax credit, buyers must be under contract for a home before April 1st or they forfeit $8000 grand!!  That’s a lot of motivation to get serious in a hurry.

Cheap Money.   The Fed and Mortgage Bankers all acknowledge that interest rates will increase this spring and continue moving upward through 2010.   Buyers know that if they snooze they lose the chance to lock in a cheap, fixed rate loan and risk pricing themselves out of their dream home, entirely.

Get Ready. Get Set.  Sell.  Home sellers should prepare for a surge in buying activity this spring that has not been seen in several years.   Make every second count now by deciding on your selling strategy.  Agent? FSBO? FSBO, combined with the power of the MLS?  Whichever you chose or want to pay for,  make sure you use the internet for all it’s worth.  And, get to  know your local home market like the back of your hand.   

Why6Percent.com will make sure you are ready when the buyers show up.   Place your property on InfoTube.net for FREE exposure to thousands of buyers each week.  Advertise your home listing to every buyers agent and on every real estate website with our cheap, flat fee MLS listing, and keep the commission.  Either way you chose, act now.  You can’t afford to wait until the buyers are looking.   This is what you’ve been waiting for.

Cut foreclosures by slicing real estate fees

Al Lewis

Tuesday, February 2, 2010

President Obama has often said that it would be a shame to waste this economic crisis. Nowhere is that more true than in residential real estate. Federal home-buyer tax credits up to $8,000 designed to increase home sales and reduce foreclosures are having little impact.  Sales of existing homes fell a record 17 percent in December, while foreclosure petitions are rising. Instead, let’s use this crisis to try a new approach: permanently slashing the 6 percent real estate brokerage commissions prevalent in most markets.

Unlike commissions paid for buying cars, stocks or insurance, these hidden commissions include two payouts – about 3 percent each to the seller’s broker and the buyer’s broker.  But there’s no need for two brokers in real estate transactions.  These hidden fees survive only because real estate brokerage is a cartel.  Forty years ago, you needed one broker to buy a house – today you need two.  In law and medicine, fee splitting is illegal. In real estate, it is required.

Most people would not hire commissioned brokers if they had to pay for them directly – that’s why the brokerage industry wants them hidden.  So let’s eliminate hidden fees for the buyer’s broker.   We could then drop the homeowner tax credit, since the buyer is saving three grand, and replace it with a $1,000 incentive credit.  This cash bonus would go only to home buyers whose purchase prices include a total commission of 3 percent or less (or none at all).

The selling brokers will naturally complain: “We can’t afford to split a 3 percent commission with the buyer’s broker.  That’s how much we need to make ourselves.  So buyers will have to make their own arrangements if they want assistance.”

And that is exactly the point:  Instead of allowing the 3 percent commission to be hidden in the sales price, this tax incentive would encourage home buyers to pay openly for whatever level of assistance they want, if any. Given those other options and the chance to collect $1,000, few buyers would opt to pay a 3 percent out-of-pocket commission – about $15,000 on a median-priced Bay Area home.  Faced with the prospect of paying that bill explicitly, most Internet-savvy buyers would probably opt for personal advice just a few times during the home-buying process, and pay by the hour or by the showing.

Even with only $1,000 of tax credit, these buyers will be better off financially than first-time buyers who collect a hefty home buyer credit, but who still pay hidden commissions.  And taxpayers are better off, too.  Any buyer could still opt to pay the traditional commission at closing – but would have to forgo the incentive credit.

This temporary incentive credit could permanently alter the structure of real estate brokerage, because there would be no going back once the credit expires.  As happened when stock commissions were allowed to decline, much lower transaction costs would create more transactions and hence more liquidity.  Liquid markets will allow people to sell houses more easily before they go “underwater,” thus reducing foreclosures.

Of course the real estate brokerage industry, which has strongly endorsed home buyer tax credits, will oppose this incentive credit. Fortunately, an equally powerful coalition of builders, bankers, mortgage brokers and consumer advocates will be lined up supporting it.

Much lower transaction costs would not just reduce foreclosures by facilitating transactions, but would also increase people’s net equity in their existing homes.  Homeowners would be better off and, at least in real estate, this economic crisis would not be wasted.

Al Lewis is author of “OOBonomics: 12 ‘Outside Of the box’ Ideas to Improve the Economy.”

http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/02/02/ED4C1BP3O5.DTL

This article appeared on page A – 10 of the San Francisco Chronicle

Thank you for visiting Why6Percent.com.  Our network brokers list property on the MLS and real estate websites for only $399…Why Pay 6 Percent????

Through 2010, homeowners who install energy efficient windows, insulation, roofs, doors or heating and air systems can apply for a 30 percent (up to $1500) tax credit for each product they purchase. 

Even better….homeowners can receive a 30 percent tax credit through 2016 (with no spending limits) when they purchase green, energy saving products such as solar systems, geothermal heating pumps, small wind systems, residential fuel cells or micro turbines.  For complete details, visit the Energy Stars Federal Tax Credits for Energy Efficiency website.

Thank you for visiting Why6Percent.com.   Advertise your home on the MLS, Realtor.com, Google, MSN, Zillow and most major search engines for real estate for 6 months for only $399.  Why Pay 6 Percent??????

What can you Learn from Foresight vs Hindsight this Year?

1. To make the most money in 2010…Get your house clean, cleaned out, staged and priced to sell NOW.
2. Do not wait until Spring is here to put your home on the market.  Do it NOW!
3. 90 percent of all home buyers shop on the internet, not newspapers, local or otherwise.  If you aren’t marketing your property on all major websites for real estate, buyers will not find your home.  There are simply too many homes for sale and buyer’s will not any waste time ferretting out information or for obscurely advertised property.
4. Use photographs and video’s to show and sell your home.   Add in video or snapshots of the neighborhood, nearby shopping, parks or attractions.   Pictures, and especially video, create interest and a glimpse of lifestyle that buyers crave.
5. Sell it yourself, but enlist the help of buyers agents.  Buyer’s agents use the MLS to find property for their clients.  Advertise on the MLS and offer up some commission to them, if they bring you their buyers!  Bonus: If you list your home on the MLS, it will immediately stop all annoying listing calls, too.

Why 6 Percent is in the business of helping sellers market their homes on every major real estate website, search engine and the MLS with one click of your mouse.  Visit our website or phone 1-800-381-9496 for details.  We can put your property in front of millions of home buyers within 24 hours.  Don’t delay.  Act Today!!

If you are serious about selling your home, then 2010 is the year for you. 

1. The decimated housing market is showing signs of stabilization in price and demand.  Prices have actually risen for the past 6 months, through October, and overall demand has increased.
2. Interest rates are at historical lows, but they have risen a half percent in the last month.  Higher interest rates are a big motivator to buy now, as no one expects rates to stay this low going forward.
3. The Fed extended the $8000 first-time buyer tax credit and expanded $6500 credit which includes non-first timers.   This program certainly helps lure ready-buyers into the marketplace.  To qualify all sales must close by June 2010.
4. Homes are affordable.  In markets like Phoenix, you can buy a home for $800 a month, which makes owning cheaper than renting.

While the news on real estate in 2010 is mixed, and no one is predicting a rebound in housing until 2013, the bear market is definitely in its last innings. 

If you have a home to sell, there hasn’t been a better time in years.  To succeed, contact Why6Percent.com to advertise your property on the MLS and real estate websites where 90 percent of the buyers are looking.   It’s really that simple. 

It’s beginning to look like 2010 is the year to buy a home. 

1. Cheap Prices:  After a decade of steep home price appreciation, the recent crash pummeled home prices back to levels last seen in 2003.
2. Low Interest Rates:   5 percent or less for a 30 year fixed rate loan mean rates are at historical lows, at least for now.  Rates are expected to rise the next 4 quarters…so if you snooze, you may loose the chance to lock in at once in a lifetime rates.
3. Foreclosures:  Although losing a home is a life changing, tramatic experience…large numbers of foreclosures have created wonderful opportunities for buyers and investors.
4. Uncle Sam:  Uncle Sam is sweetening great deals on homes by handing out thousands of dollars to first time and existing homeowners who close on a home before June.

Thank you for visiting Why6Percent.com.  If you have a home to sell, we can put your listing in front of millions of serious home buyers with the click of your mouse.  Why Pay 6 Percent???  Visit the website for details and free marketing services.

The percentage of investors shopping for property also jumps higher when it comes to foreclosed property.   42 percent of foreclosure buyers are purchasing for an investment.   57.6 percent of foreclosure shoppers plan to live in the home they buy.

The survey also shows that 23.6 percent of investors and buyers believe that home prices are already as low as they will go.  Nearly 20 percent feel a sense of urgency when searching for a bargain. 

Another factor motivating home buyer’s off the sidelines is the real threat of rising interest rates.  Wall Street guru’s, who agree on very little, warn that lending rates will rise in the near future.   With real estate prices at their lowest levels, buyers risk much more in waiting to purchase, than they do by locking in record low rates on their loan.

Why6Percent Prediction:  We believe the leading indicator of an interest rate hike will be  falling unemployment claims.  When unemployment claim filings fall below 500,000 per month, a rate hike is likely!

Realtors Prediction:  Home sales will jump by over 13 percent in the next 6 months.

Thank you for visiting Why6Percent.com, your home selling resource center.   If you are selling, buyer’s are buying.  So, don’t miss the Boat.  If they can’t find your property, they can’t buy it.  Call us at 1-800-381-9496 today.  Our MLS and Realtor.com marketing package reaches 10 million home buyers each and every month!!!