Bryan Sereny, Pa

PMI is known as the acronym for private mortgage insurance. Private Mortgage Insurance is used when a borrower has less than 20% for a down payment. Private mortgage insurance protects mortgage lenders against potential losses in the event of borrower default.

If a borrower defaults on his conventional mortgage (goes 90 days late on a payment), the lender files the state-specific foreclosure notice and sends in a claim to the insurance company to recover as much as 20% of the mortgage balance. This, in turn, gives the lender a smaller risk when the lender sells the property to recover their losses.

So it is routine for the bank to first contact the PMI company before approving your offer. Sit tight and your patience will be rewarded. - Tue Jun 23 2009, 12:41

Steve,

As everyone has illustrated, renting will not be difficult provided you price is in-line with the market. More importantly, I would like to point out that if you are financing the majority of this purchase, the rental income is not likely to cover your mortgage, maintenance, and taxes.

Best of luck! - Sat Oct 4 2008, 22:44

Unless you have plans to convert the property into condos or something else, a 1-2% CAP rate makes zero sense. - Sat Oct 4 2008, 22:37

This number could vary greatly from 5% to 40%. It really depends on the current trends in your market. I would look at the spread between list and closed sale prices to get a sense of how much other people are negotiating off of the list prices. You can see these numbers by contacting a local Realtor and asking to see the past three months of closed sale data in the neighborhood you are interested in. - Sun Jul 6 2008, 11:52

Deborah, I agree wholeheartedly with your analogy/comparison and your thought that, “it is certainly respectable for advocates of various business models to present their perceived benefits to the consumer”.

Cindi, I also would have to agree with your comment that successful, seasoned Realtors do not necessarily do this.

Billy, I have to agree with Sylvia, a tiered compensation system sounds good but likely would be difficult to implement.


Laurie, I respectfully disagree with much of what you have to say on this subject. As a general rule, the most skilled people in ANY industry tend to seek employment where they receive the greatest benefits. On that same token, the most skilled agents will gravitate towards a brokerage with a full service model and away from those with a discount model. At least that is the way it works in Southeast FL. Maybe things are different in Long Island. Not being smug, just pointing out the obvious.

In Southeast Florida (my market), there is a group called “Master Brokers Form” which is comprised of the top 250 real estate professionals in each county. None of these elite agents work for a limited service company or discount broker. Enough said? - Sun Jul 6 2008, 11:46

I can’t resist: The old adage “you get what you pay for” rings true in every industry. Would you go to the best cardiologist and ask for a discount? How about the best attorney? Not all professionals are equal. A seasoned buyer’s agent adds value and ultimately will save the consumer more than the 1% credited back from a less qualified Realtor.

Sean: a) a buyer’s agent is supposed to “negotiate” on your behalf b) if you feel as though your buyer’s agent’s interest is to maximize the sale price, you are working with the wrong Realtor. As a buyer’s agent I ALLWAYS work towards negotiating the absolute lowest price with the most concessions possible. When selecting an agent to represent you, ask them to show you their recent closed sale history and pay close attention to the spread between the list prices and the closed sale prices. The Realtor with the highest average spread clearly is worth their full commission.

A friend of mine in Boston used a Realtor that gave a 1% rebate. By my estimate, he ended up overpaying 4% to 7%. - Sun Jul 6 2008, 07:42