“What will a Buyer’s Agent do for ME?

buyers agentProfessional help in the buying process?

Overview

Sometimes new home buyer’s, or experienced buyer’s have the idea that working on their own is a better alternative than working with a buyer’s agent. With the advent of online listings, buyer’s ability to access homes for sale has risen dramatically within the past decade and many may ask the question, “why do we need a buyer’s agent, anyway?”

They may even see an buyer’s agent as an unnecessary expense that can be cut out of the equation, resulting in a better deal on a home.

People often resort to past experiences, or trusted friends to advise them through the process, which often times has to be discussed with a professional.    Since real estate is fluid, practices change from week to week, month to month, year to year, and place to place.   Customs and laws are constantly changing, so what someone else does often times has little bearing on what needs to happen in a given situation.

Most of our lessons about why buyer’s need representation comes from when we’re ready to help someone sell their home.   We evaluate what comparable homes are selling for now, and we also look at what they paid, and what comparable homes were selling for when they purchased.  When we find they ended up paying 20% above market price, then we wish they had representation.

One of the most common problems we hear about from clients is how they attempted a by owner transaction, and after hundreds of dollars in expenses for inspections and appraisals, the deal couldn’t move forward due to what should have been a correctable or avoidable situation.   Not fun!!

Step 1 to Home Buying:   Finding & Starting a Realtor Relationship

Our process starts with the Buyer Consultation where the agent listen’s to the buyer’s goals, ideals, thoughts,  and fears, then describes the process, our legal obligations to the buyer and to the home owners who’s homes we show.   We typically obtain written authorization to assist from the buyer at this meeting and establish an open dialog.

Step 2 to Home Buying:  The Search

Then, the job of buyer’s agent shifts into the home search mode.  Listening carefully to what the buyer’s want is crucial.   Taking time to consider ways to expand or narrow the scope of the search based upon the availability of potential properties is huge.   Evaluating all possible sources of homes, starting with the multiple listing service (MLS) and any other source of off market or by owner sales.

Being readily accessible for showings, often times after business hours or on weekends is a must.  Also, being able to help the buyer examine the property with a critical eye,  keeping mental notes about the pro’s and con’s of the home with respect to the buyer’s needs and wants.   “We recall helping buyer’s early in our careers and they were shocked that we didn’t walk in and sell them a house, but quite the opposite.  We began to pick apart and point out concerns for each home,” explained Chris Grus.

Step 3 to Home Buying:  Negotiations, Making Offers, Executing Agreements

“The experienced buyer’s agent isn’t just a door opener,” said Jennifer Florida, buyer’s agent at Premier Realty Exclusive.  Surveys suggest that the general public believes the number one duty of a buyer’s agent is to find the home, in actuality, making sure the buyer’s needs are represented through the process of negotiating, preparing, and executing a purchase agreement,   There are many facets to the transaction, such as ensuring that the buyer has proper support from vendors, contractors, title companies;  making sure the seller is performing their contractual obligations, and making sure everything is being explained to the buyer as the process moves forward.   While all st louis building inspectorsthese things may seem like a ‘no brainer’, it actually takes years of experience in real estate to really know how to be properly supportive.   “Keeping an up-to-date rolodex is important, but furthermore, making sure that all vendors & contractors are meeting our high standards of customer service is a challenge we insist on meeting,” added Jennifer.  Helping the buyer to arrange and understand what inspections are needed, whether or not to order an appraisal, and understanding all the contingencies in the contract make up the most important roles of an agent.

Step 4 to Home Buying:  Closing the Saleclosing packet

After everything for buyer and seller have been completed, and the scheduled date arrives, the buyer’s agent works to ensure items have been finalized.   The buyer’s emotional state varies throughout the contract process, and often times at closing they’re just ready for things to be done so they can enjoy their new home.   Having a buyer’s agent to review any receipts and lien waivers provided by the seller, make sure utilities are able to be turned over and there are no outstanding issues is of paramount importance.  Reviewing the closing disclosure statements from the lender and / or title company is a must.   Performing a final walk through with the buyer, making sure they know where to arrive to sign closing documents, that they bring their photo identification and an appropriate payment amount and method of payment all seems self-explanatory, but in some cases it is not.   In the event of a ‘remote closing’ where the buyer may not even be available in town, arranging for everything to be handled via the mail is an added responsibility for the agent to supervise.

 

Step 5 to Home Buying:  Post Closing

According to National Association of Realtor surveys of home buyers, over 80% of the Realtors being surveyed consider step 5 optional.   Providing buyer’s with after the sale support and communication is a huge priority for Premier Realty Exclusive.   As real estate experts, professional Realtors can really be a huge asset for home owners in many areas.   If, when, and how to refinance, what to do about problems that come up pertaining to their home, which update will improve re-sale value more, etc.     “Just the fact that we have been through such a personally meaningful experience with a home buyer establishes a connection for us,” said Florida.  Without a buyer’s agent that’s in the field and active, there’s always plenty of information out there, but is it accurate and timely, or is it yesterday’s news.   What’s in style varies so much, that getting input from a personal connection like your buyer’s agent is one added bonus of building a relationship with a buyer’s agent.

Finally….VIP Realtors for VIP Buyers

Over the years, we’ve heard our share of agents griping about helping buyers.

It sounded strange at first, but after a whileI understood.   Once an agent lists a home, their job can be more administrative in nature.   There’s no driving around with clients, and during a seller’s market, the listing agent holds the upper hand and can push around the buyer’s agents all they want.

VIP home buyerDespite what we heard, we always enjoyed helping buyers too.   You see more homes, it keeps you busy, and in the end, there’s a special feeling you can get seeing a home buyer LOVING their new home.   Because of that, we started our VIP BUYER PROGRAM.   We feel that we do more for buyer’s because we truly value their experience and want the absolute best for them.  When we hear stories of agents that are unreachable, can’t show homes for days, or always making excuses, we just CRINGE!

For anyone that has met with us, they’ve heard all about the VIP home buyer program.   For the first time, we’ve placed our program online to show prospective St. Louis home buyer’s how we cater to them by building a unique strategy for home buyers and how we scour all possible property resources to bring as many options to the table as we can!

Check out the link above and see how St. Louis home buyer’s are still

Loan (pre) Approval vs. Loan Commitment

lending confusionRealtors work with lots of buyer’s that think the same way about getting a loan.

It comes up too often for me when I’m driving around with buyer’s.  We’ll be talking about a non-warrantable condo, or a property with title issues, or a building that’s not livable or even burning down.

The conversation goes like this:

Realtor  “…you wouldn’t be able to get a loan on that”

Buyer  “Oh,  well…. I’m already approved”

Buyer “My loan officer told me that I’m good, just to tell them when I find the right place and we’ll be done”

This may have more to do with ‘lender spin’, or it could be buyer not reading the documents in their entirety, but that buyer, in most cases, intentional or not, has been misled.

Pre-Approval

Getting Pre-Approved for a loan is the first step in getting the lending process going.  It’s usually a 10 minute phone call to a lender, in which basic information is discussed, like your name, social security number, date of birth, annual income, and length of employment.   While a lender can generally hand out a Pre-Approval Letter after  that discussion, you’re still a long way from banks parting with large sums of money.

What comes next?

Loan Application

The preliminary actions taken to get pre-approval are usually followed up with a commitment to one specific lender by completing a Mortgage Loan Application and providing funds for the homes APPRAISAL.  Some lenders credit the cost of the appraisal back to the buyer at closing, but before ordering the home appraisal, a deposit is typically required.  This is to prevent the home buyer from completing applications from multiple lenders then backing out.

Good lenders take care of preliminary details of processing the application and wait to order the appraisal until after the home buyer is satisfied with building inspections.

Underwriting

Once the appraisal is ordered and recieved by the lender, it is included, along with the application, W2/Income Verification, and any other letters required by the bank and sent to “underwriting”.  The underwriter is the person that looks at everything processed up to that point and will approve, reject, or conditionally approve the loan.  Most loans get some “conditions”, which is ultimately a list of things needed prior to fully approving the loan.  Examples of conditions might be letters of explanation from the appraiser, the borrower’s employer or the borrower themselves.  The underwriters want evidence that they are making the right decision, and often times they want additional documentation.

Loan Commitment

After all the conditions have been met and the application has been approved, lenders in the St Louis area provide a LOAN COMMITMENT to the Realtors.  This is simply a letter  showing that the bank is ready to move forward and make the loan.  The RESIDENTIAL SALE CONTRACT from the St Louis Association of Realtors has a “built in” contingency as part of the contract for loan commitment that gives the buyer the ability to terminate the contract if they are not able to get an approval letter from their bank by the ‘loan commitment date.’

Is St. Louis on your Rank Order List?

 

If You’re graduating Med School this year and are trying to get into the residency program at  SLU, WASH U, St. Lukes, MERCYresidency relocation to St. Louis and St. Mary’s , we’ve prepared a special page on our site specifically to help you – the medical resident, find a home.   As specialist in assisting medical residents find great homes, we’ve learned that recent M.D. grad’s have relatively unique needs for purchasing a great home:

  • quickly
  • move in ready
  • close to the hospital
  • additional services during contract negotiations, inspections and move in

Contact us for a customized search with special driving proximity (or walking proximity) to your residency progam.

We started a section on our website especially for medical residents to help them avoid the pitfalls of home buying that can take place due to their difficult and fast paced process of relocation.  Visit it or pass it on to a medical resident!

St Louis real estate is our specialty! If you’re looking for real estate anywhere in the St Louis, MO area, including St Louis City, Tower Grove, Shaw,  St Louis County, St Charles, Ballwin, Chesterfield, Sunset Hills, Kirkwood, Webster Groves, or one of the other areas we serve, simply click the “Search St Louis Real Estate” link at the top or bottom of this page to begin your home search now.

 

New Year Message to 2018 Home Buyers

New Year home buying

New Years Day has always been an interesting holiday, inherently spent reflecting on my plans, goals and aspirations for the coming year.   This years freeze outside has us inside watching “Texas Flip and Move” on the DIY network.   Watching various groups of low budget, virtually no profit developers go about planning rennovation projects of homes that have to be moved with virtually no professional assistance makes me cringe inside.  After weeks of work, profits are small.   It got me thinking about the home buying process for our normal, non-televised buyers, and what we as Realtors bring to the table.

Surveys from the National Association of Realtors tell us that the buyer perspective is that the number 1 thing buyer’s agents do is find the house.   Obviously finding the right house is important, and Realtors have tremendous resources and opportunities to find homes, but the truth is that finding the house is almost always a team effort.   The role the agent has in the process does vary depending upon how involved the buyer’s want to be, and how much they want their agent involved.   Some buyer’s, despite having help from their buyer’s agent, don’t even look at searches from the agent, but rely on mobile apps or advertising sites like Realtor.com, Zillow and even other agents websites.  The problem with buyer’s doing more leg-work, is that, more often than not, they find homes that are already sold, aren’t for sale, or don’t even meet their own criteria.  On many occasions, a passionate, and even ANGRY client emails me asking, “WHY HASN’T THIS HOME COME UP ON MY SEARCH ?” (from the MLS).   It takes a minute, but with one exception, it is always because the home was excluded because of the limitations the buyer’s have given me, or the home is no longer available.   One time the home was sold 5 years earlier!   After hundreds of experiences and many years in the business, there’s no shortage of stories.  With home buying and selling being such an emotional process, its alway serious business, but in retrospect can be funny too.

No transaction is ever the same, and some buyer’s need support in areas that don’t even exist with other transactions.  From my experience, I say the number 1 thing that we do to help buyer’s is ESTABLISHING A STRATEGY.   To me, this outranks several other super important things we do, like NEGOTIATIONS, house finding, etc. because meeting with a buyer’s agent before the home search process begins and establishing a well thought out BUYING STRATEGY helps the licensed professional to factor in the importance of every facet of the home buying process.   Often times, in establishing a strategy, the agent discovers some of the ideas the buyer may have that are absolutely unrealistic.  Achieving a buyer’s ideals sounds super duper important.   It is, but if they want a condominium in a city where condominiums don’t exist, or they want to build new construction, but don’t have a down-payment, they could be setting themselves up for misery down the road.

So STRATEGIZE.  That’s the deal.  What better time to talk STRATEGY than New Years Day.   

If you know a person interested in starting the buying process, most likely their idea may be to wait until spring time.    Their ideal could be to wait to contact an agent (or not contact an agent at all) until they see the PERFECT HOME at an open house.   To me, this is like showing up at a gun fight -thinking that you’ll have time to shop for a gun.   We experience this all the time.   In today’s market, that’s usually a non-starter.   When we list a property, we first let all our buyers know about it, then post it on agent only “coming soon” sites, then calling or texting our colleagues to let them know what it is and when its coming.  This is the new normal.  During the spring and summer months, we sometimes have multiple buyers lined up before the ink is dry, so at the first open house, we have buyers and agents circling like hungry sharks.   When the unrepresented buyer shows up at the end of the day starting to sheepishly ask questions, it may already be sold.

The point is that if you’re like me, and you’re sitting unprepared home buyer around reflecting on what 2018 brings, and you HAPPEN TO BE considering a home purchase, MAKE THE CALL THIS WEEK!   It doesn’t hurt anyone to plan ahead.  Share you’re ideas with an agent 3-6 months before the search to take advantage of the experience of your soon to be agent and work out a strategy that works in the world that you are buying in.  Sign an exclusive buyer’s agency agreement, so that you’re on the ‘radar’ of a real estate professional when they start hearing about homes that match your ‘perfect home’.    Interestingly, since we’ve been in the business, buyers strategies have changed many times. The market your friend, pastor, personal trainer, psychic, or parents bought in may be TOTALLY DIFFERENT than today’s market, so the strategy they give you might suck.   Don’t make the last one to find out your game plan be your Realtor!

Greetings Holiday Shoppers!

holiday home buyer

Growing up, I watched the story about gifting real estate for Christmas several times per season.  Suprisingly, my first year in real estate, I was concerned that I’d only be able to help home buyer’s during the springtime.   The “seasonality myth” as it’s known in the industry, seems to be propagated by those that start to place focus on holiday parties, family, and worship.  I call that realtors hibernating.    While making this choice isn’t a bad thing for a person,  for a personal decision to affect such an important decision of others, like prospective home buyers, is unfortunate.  Ask any home buyer trying to buy in the springtime and being consistently out bid by $20,000+.   Ask the FHA home buyer that makes offer after offer, but is outbid not by price, but by folks putting more money down and using conventional financing.  Buyer’s need to know that lots of agents are eager to get out in December and January.

One home buyer couple I used to work for seemingly called me every time the weather was snowy and cold.   We’d look at house after house and be grateful we weren’t shopping when prices were higher and people were fighting us for the home, creating bidding wars.

The year 2017 has been a tremendous SELLER’s MARKET, but even in an overall market, there are mini shifts that buyer’s can take advantage of to get better pricing and availability.  So bottom line, if you want to buy…. get out there now and take advantage of the holiday home buying season!

 

St Louis real estate is our specialty! If you’re looking for real estate anywhere in the St Louis, MO area, including St Louis CitySt Louis CountySt CharlesBallwinChesterfield, Sunset HillsKirkwoodWebster Groves, or one of the other areas we serve, simply click the “Search St Louis Real Estate” link at the top or bottom of this page to begin your home search now.