Buying a home is about making choices. That is why it is important for any homebuyer to hire a real estate professional to help navigate the choices. Some choices make more sense than others. Letâ€™s quickly recap some of the choices.
Financing â€“ Different lenders offer different mortgage options. There is a local lender that offers 100 percent financing to certain buyers for any home regardless of location. Other lenders donâ€™t have that program. Some lenders participate in the Mississippi Home Corporationâ€™s Home Buyer Assistance Program. This program helps a borrower make the down payment. Other lenders donâ€™t participate in that program. Some lenders offer an FHA 203K rehabilitation mortgage. This allows a borrower to obtain a loan up to $35,000 to modify, modernize or make livable a house requiring extensive repairs. Others do not offer that loan. A REALTORÂ® has a list of lenders and the mortgage services they provide.Â
Housing â€“ Some people buying a house do not completely think through the purchase process entirely. Itâ€™s more than finding a house within a certain price point. It is more than the number of bedrooms and bathrooms. Itâ€™s more than a neighborhood or school district. Buyers must consider the short and long range impact of their purchase decision.Â
They need advice on whether it is better to purchase a conventional housing versus manufactured housing. Should they build a house? Is it feasible to purchase a foreclosed house? Should they keep their present living arrangement? A REALTORÂ® does more than sells houses. They offer advice based on a wide breadth of experience and education.
Pricing â€“ The agent representing the buyer has the same job as the agent representing the seller. It is to always act in the clientâ€™s best interest.Â
When representing a buyer, the REALTORÂ® analyzes the market by using a data base that is more detailed than found anywhere else on the internet. The Multiple Listing Service contains information regarding days on the market and the amount of seller concessions for sold properties. What is a concession?
A concession is an allowance from the seller to get the buyer to the closing table. Here is an example. The buyer only has enough money to make a down payment. He might ask the seller to pay a portion of the closing costs. That is a concession. Letâ€™s put some numbers to this for ease of explanation.
A seller might want $125,000 for his house. The buyer writes a purchase offer for $120,000 but includes a $3,000 for closing costs. A comparative market analysis supports that pricing strategy. The sale price is not $117,000. It is $120,000, with a $3,000 concession.
Factual information about the market makes hiring a REALTORÂ® worth every cent of the tax deductible real estate fees. Suppose a buyer has no market knowledge. He saw the exact same house. Without a market analysis, the buyer offered the seller $125,000 and did not ask for a concession. Did the REALTORÂ® just earn his fee? Did the buyer save money?
Fair Treatment â€“ Anyone notice a phrase in the previous section. The job of a REALTORÂ® is representing the clientâ€™s best interest. Letâ€™s take the previous example a step further to illustrate. The house listed for $125,000. The fair market value is $120,000 plus a $3,000 concession. The buyer states heâ€™s willing to pay only $100,000 for the house.
It is the job of the buyerâ€™s agent to explain market conditions. It is the job of the buyerâ€™s agent to remind the buyer that the seller is a real person who also has a bottom line. Itâ€™s the job of the buyerâ€™s agent to remind his client of all the features in this particular house versus alternative properties. It is the job of the buyerâ€™s agent to point out obscure facts that could create negotiating leverage. After that discussion, the buyerâ€™s agent has one job. Represent the best interest of the buyer to the sellerâ€™s agent.
Hire The Best â€“ Find a REALTORÂ® with the Accredited Buyerâ€™s RepresentativeÂ® (ABRÂ®) certification. A REALTORÂ® must complete a series of courses, pass a written examination and have a prescribed amount of experience representing buyers. The Real Estate Buyerâ€™s Agent Council (REBAC) has no higher certification for an agent representing a buyer than ABRÂ®.
Andy Kalinowski is a REALTORÂ® and an ABRÂ® with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. Contact him by cell (or text) phone â€“ 662.549.3421 or by e-mail â€“ email@example.com.Â He is also available for web video chat.