Thank you brokers for your continued support of Southern Homes Title Insurance.
April was our best month yet and we hope to continue that growth with us all working together! I recently have started a new process with the title company in order to make it easier for you to get the prior policy to your closing attorney. Every morning I will be searching for new buyer transactions in our MLS system and then searching for the prior title policies. If I find this information, I will then be sending you the policy for you to send to the attorney, along with your contract and the title preference form. Not only will this save your buyer money, you will be bringing business to Southern Homes Title Services which in turn helps to keep your broker fees low with Southern Homes. If I do not send you anything, it means that the prior policy was not written with one of our three underwriters, Chicago, Stewart and First American. If this is the case, please ask the listing agent for the prior, as it is part of a listing agents job to attempt to get this information from the seller for the buyer.
Thank you, Wisdom Stikeleather
Thank you Brokers for another Great Record Month this April. Again and again we have a #1 Market Share thanks to you. Don’t forget your CE. Have you taken CE yet? All active licensees are required to take 8 hours of CE: 4-hour Update course & a 4-hour Elective course. Deadline is June 10.
Solid, Affordable Protection for First-Time Home Buyers
Home ownership is a source of tremendous pride—especially for those first-time buyers who have worked hard to pull together a down payment for their very first home. In many respects, the stakes are higher for first-time buyers, who may not have any money tucked away for unexpected repairs. That is why our Standard Coverage Plan is such a critical part of the sale—it offers comprehensive budget protection for home systems and appliances at affordable rates. By educating and empowering first-time buyers, you can instill confidence and create loyal customers, potentially forging relationships that last a lifetime. Remember to offer all your clients the security and value that comes with an Old Republic Home Warranty Plan. Visit www.ORHP.com to learn how Old Republic Home Protection can help secure your reputation and provide peace of mind for each of your clients.
Let’s get this out of the way up front – appraisers have a REALLY tough job right now, especially in markets where inventory is low Following 2009, appraisers saw both their reputations and their finances take a major hit. As politicians looked for the “source” of the housing crisis, regulations set forth upon appraisers became almost punitive. The creation of Appraisal Management Companies- AMC’s- created a middle man designed to protect consumers. We believe the creations of a third-party appraisal management system was much needed and is a net positive for our industry. By creating a layer of separation between those who appraise the value of a property and those who lend on that value – we do believe we are setting up a more ethical and sustainable ecosystem of lending. Unfortunately these AMC’s don’t work for free. On average, an AMC will take between 5% & 20% of the appraisal fee out of the pocket of the appraiser. Furthermore, the standards by which Fannie Mae & Freddie Mac are scrutinizing appraisals has also increased dramatically. Appraisers, to meet Fannie / Freddie standards, are often asked to “justify” their values by adding additional comps and more detailed write-ups used to justify their adjustments.In general, appraisers are now having to do more work for less pay. Counting on the volume of transactions available – appraisers are one of the few occupations in the housing-market who have NOT benefited from rising property values over the last five years These challenges, in addition to low inventory, has lead to some appraisals coming in below value. Here are some tips to make an appraiser’s job easier and ensure the best chance that your property will appraise at value:
Be PRESENT at the Appraisal- It’s unbelievable how many listing agents still do not show up for the appraisal. Don’t send an assistant. Don’t send the appraiser to the lock-box. PLEASE do not let the seller show the appraiser around to point out every flaw in the house (serious – this stuff happens all the time). If the listing agent cannot be present -OR- if the listing agent doesn’t care about the appraisal because that appraisal contingency has been removed up front; then the buyer’s agent should make arrangements to be present at the appraisal. A majority of the valuation problems are on deals where there was not a seasoned agent present at the appraisal to present the benefits of the property and/or the neighborhood.
Have Comps You Are Prepared to Talk About- The appraiser doesn’t know that the house next door or down the block, which just sold, was actually missing “abc” – or is inferior to your sale because of “xyz”. If there is a reason your new escrow should sell for $50K more than the most valid comp down the street; then be prepared to talk about it with the appraiser. Unfortunately, appraisers are not agents – they don’t see every property on the market – hopefully you do. When appraisers have to evaluate various comps for fit & finish, and relevant adjustments, they count on these write-ups for valuable information. Real-estate agents are great at adding a positive spin to their MLS commentaries about their own listings. If a sale down the street which is written up as a “handy man’s dream with lots of potential upside in this flowing open floor-plan that exudes natural light” – but is really a tear down – you need to be prepared to talk about this difference in condition to the appraiser.
Understand the Market We Are In, Prep Your client – A property is worth what someone is willing to pay for it. Unfortunately, as all buyers don’t have cash, there is a 2nd component to most deals. Even when we have 5 offers presented above value and have thus identified 5 people willing to pay a certain price – appraisers cannot use this information as justification of value. Each appraiser must provide 4-6 similar comps (usually within 1 mile for most metropolitan areas) that justify the sales price. I’ve talked to appraisers socially who have told me “Scott, I get it. I know five different buyers are willing to pay $700K for a house. But if the comps only show a value of $660K – that’s what an appraiser is going to use – unless I can show compensating factors”.
Don’t Risk It – With the market and inventory as tight as it is right now, I’ve been asked by some Realtors if I can “guarantee an appraisal to come in at value”, find a way to “use my guy” or “pre-flight” a particular value by an appraiser that might get assigned the deal. For me to respond to any of these requests would probably mean I would be breaking several Federal laws. Be VERY suspicious of any loan officer willing to make you “guarantees” about an appraised value. The loan officer making those guarantees are most likely misleading you and/or breaking several laws. Winning a deal today is not worth losing our ability to do business tomorrow. Thankfully, out of the few deals where I have had appraisals come in low, we were able to hold all but one of them together and close escrow.
Be Nice – Appraisers are doing a lot of work for about $350 per property. I agree that the appraised value should never be affected by the attitude of the person opening the door to the property. However, in the areas we serve, appraisals are a little bit more art than they are science. A pleasant demeanor and a positive attitude about the property you are representing can go a long way – it certainly cannot hurt. Give me a call if you have any questions about how to prep for an appraisal or how to restructure a deal if you had an appraisal come in low.
Thank you, Mark Rawls & Karen Patterson
- Use an updated photo of yourself. Thanks to the internet, home buyers will research everything they can on their own before contacting a professional. People like to have an idea for who they will be working with. Not having a picture at all can come off as unprofessional or not fully invested.
- Social media outlets (Facebook, Instagram, Linked in, Twitter, Pinterest, Google+) are free and easy accounts that can help promote your work. Post, reply, retweet, comment, anything to engage with people!
- Brag about yourself by promoting your past success and most recent achievements. People want to see this!
- Stay consistent. Choose similar color schemes and fonts for your sites, business cards & marketing materials. Be careful when picking colors that are associated with other agencies. People link colors to brands – If there is red on your real estate business card: I think of popular agencies that use red.
- Plan before you post. Popular sites such as hootsuite gives you a chance to prepare your material so you can time posts and keep up with multiple media channels.
Thank you, Juliet McCreary