Even though foreclosures have been flooding the market since 2007 (and thankfully starting to decline significantly theses days), people have a misconception that these “half-price home deals” are rampant. Clients ask me all the time – “Just send me a list of all the foreclosures”. Why? If a foreclosure is in your price range, or a home that is not a foreclosure is in your price range; then why would you only want to see only the foreclosure? Here are a couple of things to remember when considering buying a foreclosure.

1. Foreclosures are priced at Fair Market Value. Banks will list them with a local REALTOR® and in many instances get an appraisal done before they put it on the market, so they know they are listing it at the right price.

2. A Foreclosure has likely been vacant for several months or even years. I have one around the corner from my house that has been empty since 2010. It is just now in the process of being listed by an agent. When a home has been empty that long, all kinds of problems can show up after you start living there.

3. Banks WILL NOT take an offer at 50% of the list price. If a home is listed for $100,000 and you offer $50,000 – they will just reject your offer. They won’t even take that offer seriously and make a counter offer.

So if your goal is to get in to a home, at a fair price with little or no repairs needed. Don’t look at only foreclosures. Home prices are great right now, and on the rise. So get in while interest rates and home prices are low. Of course, consult with a local REALTOR® that can advise you on the best course of action to meet your needs.

– Jeffrey Rising – REALTOR®

You’ve all heard the jokes, the office chatter, the anecdotal stories….

“Don’t work with your friends or family”.

“Don’t mix business and family…”

“I did a deal for an old friend and it was the most difficult transaction I ever did…”

I recently had one of those deals. I’ll call it “Pity Business”. The guy was clearly using me because we went to high school together and we were Facebook friends. No other reason, he knew me…I knew him…that was it. He never asked how many homes I sell every year, how long I’ve been in the business, etc. He didn’t care about qualifications in the least. It was “Hey, I might as well use someone I know so you can get paid” kind of relationship. He made an offer pretty quickly on a house, completely opposite of what he was looking for by the way. I even tried to talk him out of it when he came in to make the offer.

“You said you wanted a house in the country with no neighbors, and a garage or barn. This is in a small village on a tiny lot and no garage…are you SURE you want this house.”.

“Yes” he said. “The price is cheap so I can deal with it for 4-5 years then sell it later to buy a house I really want.”. Ok fine.

So we make an offer, his offer gets accepted, we move forward. Then the appraisal comes in about $1,500 low. I guess the appraiser couldn’t squeeze out another $1,500, but I’ll save that for a different blog post….

He of course backs out of the deal. We could have easily got the seller to come down in price. BUT…”My friend told me I shouldn’t buy out there. It’s a hard market and I’ll have a hard time selling it later.”

“Oh…who’s your friends? Are they an appraiser or real estate agent?” I said.

“No…they just know about the real estate business.”

“Ok..in what capacity?”

“They just do, I trust them.” he said.

“I see…well I need you to trust me since I’m the one that actually sells real estate here.”

If given the opportunity I would have explained to him that homes DO sell in that Village, in fact, he was buying one! I could have said people buy homes in that area because the prices are cheap, the same reason he was. But none of that mattered at that point. The friend who knows all about real estate had already swayed his opinion. If it would have been an actual client who was working with me for my expertise, he would have listened to me. But, since that was not the case – I was nothing more than the guy who would get the lock box code to let him in to see homes.

So there you have it. When you get the “Pity Business” they aren’t using you for your expertise. They are using you because they feel obligated to do so. Now don’t get me wrong. I’ve done business with family, friends and casual acquaintances that turned out great. But, now I know to lay those ground rules. Heck…even come out and say it. “I want you to use me as your Realtor because I’m qualified, if you are using me because you feel obligated to do so I’ll gladly refer you to one of my colleagues and just take a referral fee from them.”

It’s as simple as that. Lay the ground rules up front and everyone will be happy.

– Jeff Rising

Well that’s exactly what “buyer agency” is. If you are searching for a home, you can work with one agent exclusively and they will work hard to find you a home, negotiate the best deal for YOU, refer you to other quality professionals (loan officer, home inspector, etc) and ultimately make sure your home buying experience is enjoyable and smooth….all for no cost to you. The listing broker shares the commission that the seller pays them with the buyers broker.

The waters of the current real estate market can be difficult to navigate at times. So make sure your best interests are represented and get a high-quality real estate professional on your side!

– Jeff Rising

So enough of the rambling. Here is a link to the slideshare.net profile where I have the presentation posted. Let me know what you think!

So I started thinking. I feel truly fortunate to be able to do what I do for a living. I mean really. I set my own schedule (although I’m probably harder on myself than a 9-5’ers boss), I don’t have to sit in an office, or any building at all for that matter, for the entire work day. And the best part? I get to help people buy and sell homes. It’s my “one thing”.

You know – a lot of people are sitting on the sidelines just waiting for that “one thing” to happen TO them, instead of them MAKING it happen. “Maybe my boss will see my hard work and give me a promotion”, “Maybe I’ll get that $300,000 real estate listing and get it sold quickly changing my financial future”. Oh…and my favorite “All I need to do is win the lottery!” I know that some people say the lottery thing half-joking, but some people are absolutely serious. Their only hope is to drudge through their work life hoping that they’ll hit it big so they don’t have to live on social security when they can’t work any longer.

So get out there and make it happen! How do you find your “one thing”? If you can think of the thing you would do, even if you didn’t get paid for it – then that’s it. The thing you love so much you would do it for free (if you won the lottery). So go ahead and finish this statement:

If I won the lottery I would __________

Get past the “pay off debt”, “buy a new house”, “go on vacation”. Once the initial shock has worn off and you realize you dont’ HAVE to work anymore…what would you do with your time?

Then you’ve found it.

-Jeff Rising

Many consumers still think that we as Realtors just wait for the phone to ring and show homes. Just hoping to be the lucky one to catch a buyer when they are really ready to buy. Being on straight commission, you all know that this will not keep food on the table. So it’s very important that if you want to be in this business 5, 10 or 20 years from now that you give most of your attention to serious home buyers and sellers. I do of course keep in contact with the casual buyers who aren’t quite ready. I want them to remember me when they are ready, so I keep them on an email list. Call them every month or two. They will be ready one day, just not at the moment.

Here’s a few questions you can ask a potential buyer to determine how serious they really are:

• “How soon are you hoping to be moved into your new house?”

If their answer is “we’re in no hurry” or “not sure, we’re just kind of looking around” then set them free. If it was meant to be, they will come back to you when they are serious about buying a home.

• “Have you been pre-approved for a home loan, or would you like me to recommend a qualified loan officer to you?”

This is usually where you’ll get the “we just want to find a house first and then we’ll go to the bank”. This is your opportunity to encourage them to get their financing in order first, so they can find out what price range they are comfortable with. You may or may not show homes to buyers without a pre-approval letter, but whatever your policy is on that, stay consistent. If you show homes to one buyer who is not pre-approved and then demand a pre-approval letter for another buyer; it could be construed as discrimination in some way. So just stay consistent.

• “Do you own a home now that you need to sell first, or are you renting?”

This is a great opportunity to get a potential listing. If they do have a home they need to sell, try to get in to do a market analysis for them. If they are underwater or unrealistic about their price, then it serves no purpose showing them homes if they are unable to sell their current home. If it works out, you get a listing and a sale.

Real estate is a great career. If you take charge of who you work with and how you run your business – you will have great success for years to come.

– Jeff Rising

For homeowners who are in danger of losing their home to foreclosure, it is common to feel like they are alone and that no one can help. This simply isn’t true. There are real people who have been in the same situation who have found solutions. Take Lian S. of Lakewood Ohio, for example.

For Lian, her financial troubles began with a miscommunication.

Lian and her husband had just had triplets who were born extremely premature. “I was on bed rest months before they were born and they had to remain in the hospital for four months afterwards.

Despite the difficulties, they were still making their payments. “We had never been late on our mortgage since purchasing the house. Then I called my lender to push back our payment date a week or two to better align with our earning schedule,” she said.

The bank went even further, offering them a trial loan modification to help lessen their payments. “We were placed in the trial program while they processed our application for the program,” said Lian.

Unfortunately, a mixup with the paperwork at the bank caused some issues. Even though the loan modification department was processing their application, all the collections department knew was that they were making payments for less than they owed. “We were getting collections calls, but our bank told us to ignore them.”

Then, the worst-case scenario happened. After months of processing, the bank told them that they didn’t qualify for the loan modification and that they would have to come up with the $12,000 they missed on their original payments.

“We couldn’t come up with the money,” she said. “At that point, we realized that even though we loved this house, we’ll unfortunately need to move out.”

They had done their research and knew that a short sale was probably their best option. They sought out an agent who was knowledgeable about short sales. The agent, a CDPE®, got the foreclosure proceedings halted immediately. “She was an expert in the field of short sales and knew all the ins and outs,” said Lian.

The agent sold the house and Lian and her husband feel grateful. “We try and look at the positives,” she said. “We got out of the shadow of the bank and foreclosure, and we have three healthy children. Beyond this, we just let the negative roll off of our backs.”

Lian’s story is just one of many. I have a report entitled “From Foreclosure to Freedom” which tells other stories of real homeowners who faced foreclosure and found relief. Download the report, read the stories, and then contact me for a free, confidential consultation.

Don’t use a desperate person to do anything when money is involved. Think about it – the guy who gives you a quote to roof your house that is $2,000 over the other 2 quotes, the housekeeper that quotes you $500 to clean your house when someone else said $250…I could go on and on. You don’t want someone who is desperate for money to do work for you. They will overcharge and under-deliver. The same goes for hiring a real estate agent. I’ll go ahead and say it out loud, the agent who hasn’t had a closing for 2 months is likely to cut corners, overlook errors on the contract or a whole host of other potential “wrongs” just to get the deal done and a check in hand.

Do yourself a favor and use an experienced builder, housekeeper, roofer, plumber, carpenter, real estate agent, etc. Someone who has a steady stream of business so that your one deal not coming together won’t break them. If you’re a home buyer, you need someone who will go to bat for you in the negotiations and who will tell you when it’s time to walk away if the inspection report is bad. If you’re selling a home, you need someone who will tell you when it’s a low-ball offer, that they are confident you can get more money and that it’s okay to pass this offer up. Choose someone who has your best interest in mind.

While many people think social media is “ruining” personal connections, I think social media enhances them. Think about it. What if you could learn something to improve your personal or business life from someone you met online that lives half-way across the country? You would’ve had absolutely no chance of meeting that person if it wasn’t for Facebook or Google +. You may have learned a tip that could earn you an extra $25,000 a year. Or you may have learned about some fun project or activity you could do with your kids. Whatever it was, your life is better because of that person. I am in no way suggesting we abandon face-to-face interactions, that would be ridiculous. But you can grow professionally and personally through the people you meet online.

Keep an open mind – you never know who you’ll connect with!

Not true.

The truth is, rent-to-own and/or land contract sales are few and far between. In my real estate market, out of approximately 1,000 homes sold annually, I can recall maybe seeing 2-3 land contract listings every year. I see a couple of “rent-to-own” signs here and there just driving around town. So in a county of 100,000 residents we are talking 10-20 land contracts or rent-to-own deals per year. Not good odds in your favor. Really not good odds considering my real estate office alone gets at least one phone call daily of someone asking for land contract listings. Multiply that by the # of real estate offices and you’re talking dozens of inquiries weekly of people who think they cannot get a home loan, so are asking for a seller financed deal.

So what can you do to buy a house? That’s a great question! Most of the local lenders will work with you on credit repair so you can buy in a year…maybe two years. I know it seems like a long time, but how long have you been renting? Is one to two more years really that much in the grand scheme of things? If you are waiting and hoping you’ll find someone willing to offer a land contract or rent-to-own option, you may be waiting longer than two years. Better to get working on it now in my opinion.

If you need a referral to a qualified home loan specialist in the area, I’ll be more than glad to help you out with that.