We Don’t Need an Agent!—First Time Buyers Find Their Way Home

The phone rang late one Saturday afternoon. He said they had just driven by a listing of mine and could I show them the inside. “Are you working with an agent?” “No”, he said. The meeting was set for the next evening.

The young man and his fiancée arrived with an entourage of parents and assorted other relatives. Being first time buyers, they wanted assistance and approval on their first home. Looking over the home from top to bottom, they liked what they saw but needed time to think. I asked the question I always ask, “When you are shopping for a home, are you shopping for a Realtor?” The dad answered. They don’t need an agent because they could get a better deal working directly with the listing agent. I explained why this wasn’t true but could tell from the look on his face, he wasn’t sold.

I explained agency and asked the young couple to sign the disclosure on agency as required by the State of Minnesota. Buyers need to understand that at any listing for my broker, I am under contract to work for the seller and protect their interests. If the couple decides to sign a buyers’ representation agreement, they would be in a DUAL agency when looking at Keller Williams Premier homes. They had seen many homes with other real estate agents, but I was the only agent who explained agency to them or asked them to sign the required disclosure.

Days later, a decision was made; the young couple wanted to make an offer. A contract was signed for buyers’ representation for the specific home only. Dual agency now applies. As an agent working for both parties, I could not do anything that would hurt either the buyer or seller. Because it was only for the specific home, I could not discuss other property options. An offer was presented, but terms could not be agreed upon. The buyers went away.

A few weeks the price was reduced on my listing. I called this young couple to see if the lower price would be enough to renew their interest. It would. But there was also another new construction house in a different area that was being considered.

Another showing. They were sure that they had it down to between the two homes. I could see the indecision and confusion on their faces. I asked about the other home they were considering to help them contrast it to my listing to help my selling clients and put their home in a better light. As with most homes, neither home was a perfect fit. I am a firm believer that after weighing all of the pluses and minuses, homes will sell themselves if they are the right home. A week passed. No offer came forth.

Finally a phone call from the young man. We have made a decision. We are not going to offer again on your listing. It is not the right home for us. In fact, neither home is right. We are starting over. "Would you help us find a home?"

Now as their buyers’ representative, I got to work. For the next few weeks, we visited a dozen or so homes from the hundreds currently on the MLS that met their criteria. Traveling from Stillwater to White Bear Lake and Hugo to Forest Lake we narrowed down the field of potential homes to two or three. Finally, one sparked enough interest for a second showing with the parents, but this home also had a few quirks that raised concerns. That same evening, since we were out, I set up another showing for a home in a development that hadn't considered. Funny thing was, the home was perfect!

With the perfect home, there were no delay or hesitation in signing the offer. Things fell into place. With every visit to the home for the inspection and walk-throughs, the young couple became more excited.

At the final walk-through, with minutes to go before they were to receive the keys to their first home, I asked them, “So, are you glad that you decided to sign with a Realtor?”

They answered together, “Yes!! You made it so much easier to find the right home! Especially for first time buyers.” I don’t make this stuff up…Those were their exact words.

After the closing, I received a hug and sincere, “thank you for everything”, from my young clients. As they set off to begin life in their dream home a thought struck me, what a great job I have!

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Do you need an expert Buyer's Representative to help you find your Dream Home? If you are buying, selling or relocating to Minnesota and need help from a professional Realtor, give me a call or visit my website for a FREE Relocation Packet. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2008 Teri Eckholm http://www.terieckholm.com/

Sleigh Bells Ring are You Listening?—Winter is a Great Time to BUY a Home!

A fresh blanket of snow covers the landscape across the Twin Cities from North St. Paul to East Bethel and Ham Lake to Scandia. Winter is not a time to hide from the elements and wait until spring to make a home buying decision! Although making a move in a Minnesota winter’s snow and ice is not ideal, the timing could not be more perfect to buy a home and get a GREAT DEAL!

Here are the Top Ten Reasons to Buy a Home THIS Winter!
Reason 10—Holiday Décor. Visiting homes this time of year will really put you in the holiday spirit. Many homeowners use this opportunity to deck the halls with hopes that there will be a purchase agreement in their Christmas stocking!

Reason 9—Check Window Efficiency. No that frost on the window is not a holiday decoration! Subzero temperatures really put windows to the test. Some windows will fog between the glass panes, others will ice up on the interior and then there are those that stay crystal clear in the cold. This energy efficiency test can only be done when the temperature is extreme outside.

Reason 8—Low Traffic/Less Competition. While most Minnesotans are shopping at the Mall of America for gifts or attending “A Christmas Carol” at the Guthrie Theater, savvy home buyers are visiting homes with their Realtor!

Reason 7—Realtors have Tons of Time. Most Realtors are not juggling several clients and will be able to spend more time scouring the MLS to find the perfect home for their buyers!

Reason 6—Tightened 2008 Mortgage Guidelines. In the first quarter of 2008, most borrowers who have good credit, but have FICO scores below 680, will be required to pay more points at closing or incur a higher interest rate. The amount that a borrower could be forced to pay, even if they've never been late on a payment, could be as much as 2.00% in points or an interest rate that's 1.00% higher than the going rate.

Reason 5—Check the Heating System. Whether the home is heated with a forced air furnace or a hot water boiler, checking out the heating system in the summer is hard to do. On a cold Minnesota evening, a furnace problem is very obvious!

Reason 4—Builders Discounts. New Construction developments hoping to clear inventory before the end of the year will often slash prices. Buyers ready to buy non-contingent are in the best position for a deal…Especially when they are accompanied by their agent to assist with the negotiations!

Reason 3—Low Interest Rates. Just after Thanksgiving, interest rates dropped to the lowest point in 25 months! If you don’t buy now, you could miss a great opportunity to cash in on the lowest rates since October 2005.

Reason 2—Amazing Inventory. Whether you are looking for a starter town home, a single family home, a private country estate, a McMansion or a lakeshore paradise, there are probably a slew of properties for you to select from. A search of lakeshore in Anoka, Chisago and Washington Counties alone, yields nearly 100 available homes. Now that is a great selection!

And, drumroll please, The Number 1 Reason for Buying in the Winter—Motivated Sellers. Homes that stay on the market in December and January in the Twin Cities are homes that need to be SOLD! If they are motivated enough to suffer through a Christmas Eve showing, they probably are willing to negotiate on the price as well!

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If you are buying, selling or relocating to Minnesota and need help from a professional Realtor, give me a call or visit my website for a FREE Relocation Packet. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2007 www.terieckholm.com

Contract Cancelled—Understanding Risk of Loss

Picture the following scenario: After months of searching for the perfect place to call home, you wrote an offer that was accepted and will be closing in 60 days.

Three weeks prior to the closing, straight-line winds blow through town. Concerned, you drive up to your dream home and see that the picturesque oak trees that gave the home character have been uprooted. Worse yet, one of the huge trees fell onto the house severely damaging the roof. You are devastated as this was no longer the home you pictured in your dreams. What happens now?

Risk of Loss is one of those “boiler plate” clauses on page four of the purchase agreement used most often in the State of Minnesota. Being preprinted, some agents and/or their clients will gloss over this clause but it is very important to understand, as is every other line in the document you sign to buy a home.

Line 147 clearly states that the risk of loss due to any reason whether an act of God or the acts of vandals will be the responsibility of the seller from the time the purchase agreement is signed until the date of closing. That means if there is a fire or accident the seller is required to bring the home into the condition that it was in at the time the contract was written and signed.

So if that temperamental decade old dishwasher goes out, the seller would replace it. If a neighbor backs over the mailbox at the end of your driveway, it is the seller who must repair the post and replace with a new one. Final walkthroughs are essential to ascertain the condition of the home prior to signing the closing documents. But what happens to those irreplaceable picturesque trees that have fallen on the roof?

Three weeks prior to a closing, there could be plenty of time for the seller to call their insurance company and have the home repaired. But is it the same house? And more importantly does the buyer still have to buy the home? In a word, no.

The clause goes on to say that in the case where there is substantial damage to the home or property, it is the buyer’s option to cancel or continue with the purchase agreement. In the situation outlined above, which was a real situation that occurred this past summer, the landscaping was changed and could not be replaced. The damage to the home caused an insurance claim that would now be reflected in a CLUE insurance report that could affect the ability to insure the home. The buyers opted to cancel the contract as was their option in the clause with all earnest money refunded.

Risk of loss comes into play quite often when buying and selling a home. In most cases the repairs are made quickly to both the buyer’s and seller’s satisfaction and the contract will close on time. But when the property sustains significant damage, the buyer has the option of continuing to closing or walking away from the deal. Boilerplate or not, Risk of Loss is an important clause to understand when buying or selling a home.

If you are relocating to Minnesota, are looking for Homes for Sale in the north and east Twin Cities metro area and need help from a professional Realtor, give me a call or visit my website for a FREE Relocation Packet. I specialize in acreage properties! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2007 www.terieckholm.com

Home Buying 101: How Much Earnest Money Do I Need?

Every home buyer loves the process of visiting homes and finding that perfect place to call home. Sitting down and writing the offer is not always as much fun! For many people, the process of buying a home is something they go through only once or twice in a lifetime. New terms and questions come are the norm as the purchase agreement is prepared. As a Realtor in the northeast Twin Cities metro, whether I am working with first time buyers, move-up buyers or empty-nesters, one question always stops the process for a moment of discussion. How much earnest money are you prepared to offer?

The amount of the earnest money varies with each purchase agreement. A buyer must first understand the purpose of the earnest money to determine the right amount to include with the offer.

Earnest money is the funds that a buyer puts down to demonstrate to the seller their seriousness about buying a home. It should be an amount sufficient enough to indicate to the seller that the buyer will not walk away from the deal without good reason. In Minnesota this is traditionally 1% of the purchase price but it can be up more. A lower amount can also be acceptable with some offers. However it is important to be realistic.

A few years back, a potential buyer wanted to put down $100 earnest money on a $300,000 home I had listed. The seller was not impressed and felt it was an unreasonable amount as the buyer could easily walk away from the deal with only $100 at risk.

Generally the earnest money funds are in the form of a check. That money is deposited into the listing broker’s trust fund or escrow account. In Minnesota, the funds must be deposited within 3 days of an offer having been accepted in writing. Yes, this does mean that the check will be cashed in 3 days or less!
If the offer is accepted, the earnest money will be applied to the down payment and/or the closing fees when the closing takes place. If your offer is not accepted the check is not cashed and the money will come back to you.


However, if the offer is accepted and the check cashed and then for some reason all contingencies are not met or other situation arises where the sale does not proceed, the buyer does not automatically receive a refund of the earnest money. Nor, does the seller automatically keep the down payment. Buyer and seller must reach an agreement for the cancellation of the agreement and disbursement of the funds.


If you are relocating to Minnesota, are looking for Homes for Sale in the north and east Twin Cities metro area and need help from a professional Realtor, give me a call or visit my website for a FREE Relocation Packet. Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.


Copyright 2007 terieckholm.com

The Realtors’ Code of Ethics--The Rules I Live By

From the time we are children we learn right from wrong. As a child, our parents guide us and help us to establish an internal compass that directs us throughout our lives. I have always abided by the Golden Rule; Do unto others as you would have done to you.
The Realtor’s Code of Ethics is based on this same principle. It is an outline as to how we as Realtors conduct our real estate business. It defines how we are to treat our clients. It specifies how we are to treat the public. And it further directs how we as Realtors should treat other real estate professionals.

Not all real estate practitioners are Realtors. In order to use the Realtor name you must join the National Association of Realtors and abide by their code.

In my Minnesota real estate practice, I take these rules very seriously. It is considered the standard of practice that I work under as I truly believe it is the right way to do business.

Although there are many details to the complete code of ethics, here are a few points I would like to highlight:

• Realtors pledge to protect and promote the interests of their client.


• Realtors do not mislead on property value.


• Realtors preserve the confidential information of their clients.


• Realtors must disclose material defects and facts on properties.


• Realtors must not discriminate.


• Realtors must disclose dual agency.


• Realtors are required to be accountable for funds.


• Realtors must disclose accepted offers.


• Realtors are required to provide competent service.


• Realtors are not lawyers and cannot offer legal advice.

As a Minnesota real estate professional, I am proud to be a Realtor. And this is a sampling of the rules that I live by.
If you are relocating to Minnesota, are looking for Homes for Sale in the north and east Twin Cities metro area and need help from a professional Realtor, give me a call. Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2007 terieckholm.com

Home Buyers Guide: Important Checklist for a Final Walk-Through

What an exciting day; the day you close on your new home! A few days before, your Realtor had called to schedule the date and time of the final walk-through. You thought, “This is great! I needed to check the paint color in the bedroom and measure the windows for blinds.” But that is not what the final walk-through is for. This is the last opportunity for you to see the home prior to closing. It is an appointment not to be missed or glossed over. It is a time to stay focused on your investment and examine the condition of the property one last time.

The purchase agreement that you sign in the state of Minnesota requires the seller to warrant that the central air conditioning, heating, plumbing and wiring systems on the property are in working order on the date of closing. It also insures you the rights to a “walk-through” review of the property prior to closing. This is not something to forego.

Last year there was a news report of first-time buyers who headed with all of their belongings directly to their new home after closing. They intended to move right in and enjoy their dream home, but arrived to find a nightmare. Sometime since seeing the home and writing a purchase agreement, a pipe had burst and flooded the entire home. These buyers had considered the final walk-through unnecessary since they had just seen the home a couple of weeks ago. Now they were the proud but frustrated owners of a huge mess. Although they do have legal remedies for having the home repaired, these buyers would have been in a much better position if they negotiated with the seller prior to closing. Or in the case of this extreme damage, the buyers could have not signed the final documents to purchase the home.

Every buyer should do a final walk-through on the home as close to the closing as possible. I suggest to my clients that we schedule the walk-through immediately prior to the closing. We meet one hour before at the home to review the condition of the property and then go directly to the closing. Any problems are noted and I immediately contact the seller’s agent so they have time to discuss the situation with their seller before our arrival.

The walk-through just prior to closing doesn’t eliminate every surprise that a new buyer might face. But it significantly reduces the chance of closing on an unknown disaster. Here is a checklist you can use as a guide to remind you of the things to check during your final inspection of the home.



Final Walk-Through Checklist
Double Check the Paperwork**Do you have a copy of the sellers’ disclosure?
**Do you have all required/requested inspection reports?
**Have you checked with the city to verify that all permits were issued for repairs and other information on the home’s history?
**Are all work orders complete? Are you satisfied with the results?

Exterior Review
**Check steps, sidewalks, driveways and patios for any noticeable change.
**Review drains, downspouts and gutters for change.
**Look at all doors and windows to verify they are in the same condition.
**Check the roof for changes…do any shingles appear loose or missing?
**Check the garage door? Do the openers work? Is the auto-reverse functional?
**Check for any noticeable leaking in garage.
**Double check garage and exterior lights.
Plumbing Review**Flush all toilets.
**Check all faucets both hot and cold for water pressure and temperature.
**Watch all traps and drains for proper drainage.
**Check operation of all appliances:

• Washer/Dryer
• Stove
• Dishwasher
• Water Heater
• Water Softener
• Refrigerator
• Garbage Disposal
• Trash Compactor

**If there is a in-ground sprinkling system or swimming pool, verify that it is in proper working order.
Interior Rooms Review
**Check that all doors, windows and screens are operational.
**Check ceilings, walls and floors for stains or other signs of damage.
**Check all handrails.

Electrical Review
**Check all lights, outlets, bathroom fans and kitchen fans.
**Verify that all smoke detectors, carbon monoxide detectors, security systems and door bells are functioning.
Furnace and Air Conditioning Review**Increase home thermostat on furnace to verify proper operation.
**Test air conditioning by lowering thermostat if outdoor temperature is above 65 degrees to verify air conditioning is operating.
**Check that gas fireplaces are operating properly.
Attic and Basement Review**Check for changes in any stained, damp or wet areas.
**Verify that there are no new wall or floor cracks.
**Is the sump pump operational?

A quick review of the home inside and out with a checklist will get you back to exciting part of that final walk-through…Will the couch look better here or there?


If you are relocating to Minnesota, are looking for Homes for Sale in the north and east Twin Cities metro area and need help from a professional Realtor, give me a call. Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota.

Copyright 2007 terieckholm.com

Mortgage Fraud—Important Reminders For Buyers, Sellers and Agents

Last summer while driving home from an appointment, I received a call on my cell from an agent who had just shown one of my listings. The listing was a little town home in the north metro of the Twin Cities. Since there were several other properties listed in the development, my seller had just reduced the price by nearly 10% to generate activity. This particular buyer’s agent was very excited. Her client loved the property and they were going to sit down that afternoon to write an offer. Before the did, the agent had a question: “Since buyer had some financing issues, could the seller do a contract for the down payment?”

My seller was not in a position to do that and I said so. She then asked if the property would appraise for $10,000 over the amount. If it could, then we could write the offer for $10,000 more than the asking price if the seller could agree to write up a contract for deed that would be immediately forgiven at the closing. As I maneuvered down the road to a stoplight, I paused a second. After taking a breath I asked the other agent, “Do you realize that what you just suggested is Fraud?!”

The buyer’s agent said that the loan officer had suggested this method and it was perfectly legal. The agent didn’t sound very experienced so I suggested that she check with her broker regarding the situation and call back. When the phone rang again, a few minutes later, there was a nervous, distraught agent on the other end of the line. She would not be writing an offer after all. She was distraught because she was a brand new agent and had just closed on a similar deal a month ago. She was at risk of losing her license.

This is not an isolated case. Mortgage fraud is not common but it is out there.

According to the FBI webpage on mortgage fraud, there are two specific types: Fraud for Property and Fraud for Profit

The scenario outlined above was Fraud for Property or Fraud for Housing. This is where a specific borrower misrepresents information on the loan application, appraisal, property or other document for the purchase of a specific property. Often buyer’s really want to be home owners but are not able to qualify through the correct channels. This type of fraud accounts for an estimated 20% of all mortgage fraud.

Fraud for Profit is more newsworthy. It is when industry professionals, real estate, title and mortgage agents, generate multiple loans for multiple properties. There are many different scenarios where unsuspecting individuals have signed documents and given social security numbers for a variety of reasons. Then realize months down the road that their information was used to fraudulently purchase properties.

To learn more about the different types of mortgage fraud schemes visit the FBI mortgage fraud webpage .

So how do you protect yourself?

Know your Realtor—Check out all credentials with local board of Realtors. Check with the state and local licensing board. Ask and check references.

Know your Loan Officer—Just as with your real estate agent. Check credentials, licensing and references. Deal directly with the loan officer and don’t arrange loans through third party services.
Don’t Sign ANY Blank Documents—Or any documents with omitted, incorrect or blank information Make certain you understand everything you sign. If you are unsure of any document, check with your attorney or legal representative before you put your name on the bottom of the page.

Do not agree to refund any money to the Buyer after closing—This is a common mistake. Often at the final walk through, a buyer will notice something they would like repaired, but the closing is in an hour. In order to facilitate the closing, the seller will agree to an amount to pay the buyer to have the repair made. If the mortgage company is not informed, it could be considered fraud. How should the situation be handled? The seller could agree to pay the service person directly. If a repair needs to be made, make it. If something needs replacing, replace it. If the funds can be escrowed for the repair, escrow the funds. All documents and agreements must be approved by the lender.

Get Copies of Everything you Sign—Protect yourself. Make certain when you leave the office you are given a complete set of documents including everything you have signed.

Copyright 2007—Teri Eckholm

Dangerous Decorating--Home Improvements that Lower the Value of your Home!

Reality television home improvement shows are no doubt fun to watch. It is amazing to see a small room or entire home transformed into a show place. Some of the most unbelievable transformations are on children’s rooms. They will take a theme like the racecars or princesses and make a child’s dream come true.

As a Realtor, my favorite part of the show Trading Places: Boys vs. Girls, is at the very end when the parents arrive to see the redecorated room for the first time. Whether there are ropes hanging from the ceiling, a psychedelic paint job or artificial grass on the floor, the reactions are priceless. Sure they are saying “awesome” for the television cameras, but are they really happy with the new rooms? As a parent, I know how quickly kids grow out of favorite toys, colors and activities. A theme-based room could be hard to transform back to a normal room when the fad passes or child grows. And what if you have to sell your home? How will potential buyers view that boat on the ceiling or the chalkboard walls?

This isn’t just something that happens on television. People really do crazy things to their homes and it’s not always for their children. Whether it is a unique wall treatment or an indoor hot tub, some people’s individualism hurts the value of their homes.

Here are some of my favorite, unbelievable things I have seen in people’s homes and how the remodel deteriorated the estimated value.

Playground Swings in the bedroom. This family removed a wall from two adjoining bedrooms to create one large room and bolted two playground swings to the ceiling. This home was 1700 ft.., split level home with 3 bedrooms prior to removing the wall. It is now an odd two bedroom. Combined with the possible extreme damage to the structure of the home depending on the weight of the persons using the swings this home would have lost thousands of dollars of market value.

Crinkled grocery bags glued to the wall instead of wallpaper. It is a nice unique look but since it will be difficult, if not impossible to remove, you will need to find a buyer who likes the look as much as you did.

Multi-colored hand painted murals and stenciling painted on walls throughout the home. This can be beautiful to the owner but because it is uneven, it is difficult to repaint. Often sanding and several layers of special primer are required to remove.

Indoor hot tubs. Unless you are installing in a four-season porch, think twice about this, especially if you live in a cold weather state. It just doesn’t make any sense. I have seen them installed in bedrooms and family rooms. Many were professionally installed. Most buyers still didn’t like them because they took away living space. Often buyers were concern about the installation. What if it leaks? Will it wreck the foundation? Does the steam cause mold? Even if the sellers offer to remove the hot tub prior to the closing, buyers have so many concerns that they will walk away from the home. Again your improvement reduced the value of your home buy tens of thousands of dollars.

So does this mean a person shouldn’t personalize their home at all? Of course not! It is your home after all.

What I am suggesting is that when you are considering a home improvement or trying the next decorating trend, remember that your home is your biggest investment and asset. Put the hot tub on the patio, deck or four-season porch. Swings belong in the backyard. And wall treatments need to be removable and easy to repaint. Make your decisions with this in mind and your home will be beautiful and pocketbook will be protected.

Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part Two of Two)

The Twin Cities Fox News affiliate’s investigative team recently ran a new segment on mortgage and real estate fraud. A man was allegedly bilked out of nearly half a million dollars by a loan officer and real estate agent he met in a bar! The story is not a new one but what struck me was the “in a bar” statement. How many people are selecting their advisor on real estate over a beer in the local tavern? Let’s think about this a minute. One of the biggest, most important investments in a person’s life and they rely on an acquaintance in a bar? I hope they at least ordered some appetizers before they signed the contracts!

The average American will buy or sell a home only 2-3 times during their lifetime. It is imperative to have a logical process to select a real estate agent. Purchasing and selling a dwelling for your family is a very emotional situation. If you chose an agent wisely, you will be confident that your Realtor is on your side through the entire purchase and/or sale even when emotions are running high.

As a Realtor in Minnesota, I love assisting people to find the perfect home. My clients come from the referrals of past clients as well as open houses and other marketing avenues. When I meet a potential client, I expect questions about myself and my business. I answer additional questions about the Twin Cities metro real estate market and specifics about homes available. Not all of these potential clients ask relevant questions. They can already be caught up in the emotional buying process or a major life change. There is an easy step-by-step approach that can be used to find the best real estate agent for your family. In part one, I discussed how to prepare yourself mentally for meeting with potential real estate agents. (View part one of the article at http://www.mnrealestateupdate.blogspot.com/ ). Here is final step in my step-by-step approach to selecting the perfect Realtor for you.

Six questions to ask a potential agent

Do you have an introductory flyer or personal resume that you could send me prior to our meeting?The way an agent promotes him/herself will give you a good idea of their professionalism. If you receive high quality, well thought out marketing materials in the mail within the next day or two, the agent is on the ball. A well written, professional personal brochure should be part of a Realtor’s marketing materials. If you receive something of less quality or nothing at all, the agent might not be able to pay attention to detail throughout the transaction.

Do you work independently or as part of a team?

If you are part of a team, who will I be working with most often? If you prefer to have someone who can immediately answer the phone and track down an answer, you might like working with an agent that is part of a team. But it is important to understand how the team operates. Some teams will operate with the agents being interchangeable where you will have one agent showing you homes to buy, one agent handling listing your home, and another holding the open houses. Often teams will have unlicensed assistance handling the incoming phone calls.

If you want to work with the same person throughout the transaction, you may prefer an agent that works independently. Often when you call their office, the agent will pick up the phone. They handle all the details throughout the transaction and can answer your questions directly without waiting to contact another source.

Can you give me the names of past clients?

An experienced Realtor will have worked with any number of clients and will be able to provide you with a list of previous clients that you can contact as references. When talking with the references, it would be a good idea to ask if they had any problems during the transaction. If they did, ask how quickly and professionally they were resolved. Also ask how they met their agent. If the agent gives you only a list family members and best friends from high school as references, it may be concerning.

(For Buyers) Can You Help Me Understand My Financing Options?

If you are pre-approved for a mortgage but do not understand the financing paperwork after meeting with your loan officer, a good real estate agent should be able to peruse the documents to note any fees that do not seem correct. Sometimes a phone call by a Realtor to the loan officer on your behalf can resolve the issue. If not, most real estate agents have several good mortgage professionals that they have developed professional relationships with they can call upon. It could be in your best interest to visit with another loan officer to verify that all fees charged are necessary and that you are in the best type of loan program for your situation. Any real estate agent unable or unwilling to assist you in finding the tools to understanding your financing options might not be the best choice.

(For Sellers) What is your listings-to-sales ratio?
Some agents seem to have every house on the block or every house in a neighborhood listed. You see their signs in yards throughout the town. There ads are in your local newspaper and in your mailbox. This is may be an indication of a successful Realtor. But the big question is “Did the homes sell?” In this slower buyer’s market, there are many more homes on the market than buyers. Do you want an agent that can successfully get you to list your home or one who will actually get the home sold? If the agent is unsure of their ratio, you can figure it out for them. Ask how many homes they listed last year. Then ask how many listings they sold. (Make sure that the agent doesn’t include sales of homes where they represented the buyers.) Divide the listings sold by the total number of listings to get the ratio. If the ratio of listings-to-sales is less than 50%, you might want to select a different agent. Successful agents won’t sell every home they list, but their success ratio will be over 70%, even in a slow year.

(For Sellers) How will you market my home?
A comprehensive marketing plan should be prepared for your specific home prior to signing any contract. Good agents establish a marketing plan for each home they list. Your Realtor should provide you with a schedule of advertising and open houses. They should outline what publications and websites your home will be listed in and the timing for their inclusion. If there is going to be a sign in your yard, your agent should tell you whether their will be a brochure box with flyers for potential buyers driving by. Anything from the number of pictures in the MLS or whether there will be a virtual tour should be discussed and outlined.

Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part One of Two)

The Twin Cities Fox News affiliate’s investigative team recently ran a new segment on mortgage and real estate fraud. A man was allegedly bilked out of nearly half a million dollars by a loan officer and real estate agent he met in a bar! The story is not a new one but what struck me was the “in a bar” statement. How many people are selecting their advisor on real estate over a beer in the local tavern? Let’s think about this a minute. One of the biggest, most important investments in a person’s life and they rely on an acquaintance in a bar? I hope they at least ordered some appetizers before they signed the contracts!

The average American will buy or sell a home only 2-3 times during their lifetime. It is imperative to have a logical process to select a real estate agent. Purchasing and selling a dwelling for your family is a very emotional situation. If you chose an agent wisely, you will be confident that your Realtor is on your side through the entire purchase and/or sale even when emotions are running high.

As a Realtor in Minnesota, I love assisting people to find the perfect home. My clients come from the referrals of past clients as well as open houses and other marketing avenues. When I meet a potential client, I expect questions about myself and my business. I answer additional questions about the Twin Cities metro real estate market and specifics about homes available. Not all of these potential clients ask relevant questions. They can already be caught up in the emotional buying process or a major life change. Here is a great step-by-step approach to selecting the perfect Realtor for you. Part one of this article outlines how you can prepare yourself to set up meetings with potential Realtors. Part two will give you specific questions you can ask of potential agents so that you can make a good decision.

Step ONE
Ask YOURSELF these six questions?
Who do you trust for advice?
Is it a parent or grandparent? Maybe a close friend or uncle? Or is it your sibling or boss? Think about the qualities that person possesses and why you look at them as an advisor. If your trusted advisor is your grandfather, you might prefer working with someone older. If you tend to bring your problems to your best friend, you might want a Realtor with similar characteristics to your friend.

How demanding are you?

If you are an impatient person who needs answers as soon as you think of a question, you will need a Realtor that is available to you. If you are more laid back, you might prefer a Realtor with a similar style.

Do you prefer to use email or the phone as your main source of information?

Some Realtors are very computer savvy and will answer an email within the hour. Others answer emails once a week or less. There are Realtors who return calls only one time a day or week. There are others that always answer their own phone and others that have an assistant to field calls and answer basic questions.

Are you into gadgets?

If you are listening to your Zune while you surf the net on your wireless laptop, you might prefer working with an agent who presents your market analysis in a Powerpoint presentation or emails it to you in a pdf file. If you prefer a paper document to refer back to and make notes on, a Realtor with more a more traditional style might be what you need.

Do you have expensive tastes and exclusive brands? Or are you more conservative?

If you like the finer things in life, you might prefer a Realtor who drives a BMW and signs your contract with a Mont Blanc pen. If you are more conservative, a Realtor in a Ford F250 that uses personalized ballpoints might be more your style.

Step TWO
Research

Now that you have answered these questions, you have a bit of an idea as to what you are looking for. Armed with this information, it is time for the second step. Research websites of potential agents BEFORE you meet them. Read their profiles and determine what their style is. If you cannot ascertain their style from their site, move to the next agent. There are hundreds of good agents out there. But if they cannot market themselves, how will they be able to market your home? Come up with a list of 4 or 5 potential agents and visit your state’s department of commerce website to check for violations on each potential agent’s record. Also, check independent local sources like the Mpls/St Paul Magazine’s listing of Super Agents.

Now you are ready to interview the potential agents. Get some great questions ready so that you can find the best Realtor for you. Having trouble coming up with great questions? Real Estate Agent Selection Primer—How to Choose the BEST Realtor for YOU! (Part Two of Two) will give you some advice.

Zillow—Valuable Tool or Inaccurate Values?

When Zillow first hit the web last year, I was intrigued. Wells Fargo Bank had previously offered a similar tool on their website but it was no longer available. When I checked out Zillow, I wasn’t surprised to find that similar to the bank tool, the numbers were only accurate in areas where homes were similar in age, design and lot size. If you live in an eclectic neighborhood with radically differing styles of homes, near a lake or in the country, the value could be off by thousands. So when I checked it out, I took the information with a grain of salt. After all, the value of my own home since it is located in the country was based on its sale price from 10 years ago and its current tax value.

Evidently the Wall Street Journal Real Estate Journal had some of the same observations as I had with Zillow. Recently they looked at 1000 recent home sales transactions in seven different states and compared them to their “Zillow Zestimates”. According to the article, “Zillow came within 5% of the price in a third of the transactions studied by The Journal. It was more than 25% off target on 11% of them. In 34 of the 1,000 transactions, Zillow was off by more than 50%.” There was an overall median difference between the actual sales price and the Zillow estimate of 7.8% which is very close to the margin of error Zillow estimates at 7.2%. Read the entire article at http://www.realestatejournal.com/buysell/tactics/20070215-hagerty.html?refresh=on

For certain homes in certain areas, Zillow is a great tool. I recently visited the site and was surprised at how their service had expanded during the past year. Not only could someone find an estimate of value for a home but there is a listing search as well. Buyers can search homes that are currently listed, both FSBO and with Realtors. There are color photos, aerial views, street maps as well as values. As an agent, I will only be listing homes on Zillow that fit the criteria where an accurate “Zestimate” will come up. But it is a tool I will use. My clients were impressed as it was another avenue to bring in buyers.

Zillow will not replace the knowledge and expertise of an experienced real estate agent. But for quick values for homes with similar styles built in many city developments, it is surprisingly accurate. With all of the added features and information, Zillow can be a useful tool in the right hands.

Staging for a Quick Sale—Cleaning for a Buyer!

Clean! OK, that seems easy enough. Most people clean on a daily or weekly basis but now you are selling your home. People who don’t know you will be walking into your home and assessing your property to determine if it is a place that they want to bring their family into. This means you need to clean until the place SHINES. And yes that does mean before every showing and open house.

So sellers scour the sink and clean the carpets and put up the for sale sign. But after the first few showings, their Realtor calls with feedback from potential buyers. Unfortunately, this can be where sellers find how good their preparation really is…When you’ve work for days and are told the house is “dirty”, what a slap in the face.

So let’s take a look at what is often overlooked by eager sellers and not overlooked by potential buyers!

Refrigerators—Clean inside and out! Remember a different family is going to keep their food in this appliance and they don’t want it to be repulsive! Throw out half-eaten food or store in sealed storage containers. Get rid of that moldy orange way in the back behind the drawer. Throw away that weird mustard that came with last year’s holiday basket. Take down all notes, magnets and papers from the outside and clean any discoloration. If they are not essential, don’t put them back on. Tuck them in a drawer or throw away. Carwax works well on white, smooth appliances to remove yellowing. Remove all drawers and shelves and clean until all grime is removed. Open the doors and check along the inside edge—especially note the rubber molding around the edge where food and spills can collect.

Range/Ovens—Clean your stove from top to bottom, inside and out. Use non-abrasive cleaners to remove all of the stuck on food from the range top. If it is stained and/or damaged, consider replacing. Clean the microwave and oven. Yes, potential buyers will look inside. If you are storing crackers and cereal inside, it doesn’t say to the buyer, this person can’t cook. It says the microwave doesn’t work! If there is burnt-over or rotten food inside the oven, it says, this family doesn’t clean!

Bathrooms—Take an honest look at your shower and the flooring around it. If it looks substandard to you, it will look gross to a potential buyer. Remove old discolored caulk and put it new. Open the toilet lid and make sure that it is clean inside. And it goes without saying that one pair of dirty underwear on the floor can blow the whole deal!

Walls—Wipe down walls by often used light fixtures--Especially if you have little ones. Also, move that trash bin in the kitchen and towel in the bathroom and check behind. It may require some scrubbing. If the stains cannot be removed, consider repainting.

Basements and Garages—These just cannot be a dumping area for all of the things you don’t know what to do with! Clean them out so that potential buyers can open the doors, walk around and see all the way to the corners. If you have to store some items in your garage or basement, they need to be boxed and stacked neatly with plenty of room for a buyer to see what the foundation looks like.

Litter Boxes and Kennels—Pet areas must be cleaned every day and before every showing. Beautiful homes are not considered if it appears that the pets have destroyed the home. If there is an odor, sellers assume it will not go away simply by removing the pet. They assume that the smells have permeated the floors and walls. If possible, let your pet stay with a trusted friend during the duration of the sale of your home.

Light fixtures and Vents—Look up! Sellers often spend hours on their hands and knees scrubbing the corners and sweeping the floors but forget to look up toward the ceilings.
Dirty ceiling fans and light fixtures are commonly overlooked by sellers but not buyers. They turn on that fan you haven’t touched in six months and all of the dust and dirt is suddenly airborne. Remove the glass from every light fixture and clean off the grime. Wipe down every blade on every ceiling fan. Vacuum the top of every curtain and drape. Check every corner for cobwebs. Remove every vent whether bathroom or air return and wash in mild soapy water to remove the dust.

So, if your home is not selling it’s time to get going. Take another look around your home from a buyer’s point of view and let’s get cleaning.