Real Estate Word of the Day: What is a Buyer's Agent?

Buying a home is not an every day event. The average person purchases real estate once every eight years .Whether you are a first time buyer or someone who hasn’t purchased a home for several years, sometimes a refresher on real estate terms can be very helpful. I often notice my Minneapolis/St Paul buyers (and sellers) with a glazed look on their face when certain terms come up so I thought an online real estate glossary would be helpful. The real estate term for today is:

Buyer’s Agent An individual contracted by the buyers to represent them in the purchase of their home.

When buying a house, the home is listed by a broker or company. The REALTOR® that lists the home is the listing agent for the home and is under contract with fiduciary duties to the seller. When a buyer calls on a sign or enters an open house, the information they provide is shared with the seller because the listing agent is required to disclose all information to their client.

A buyer can have their own representation when purchasing a home. They do not have to work with the listing agent. In fact, almost all of the home buyers I have worked with prefer to have their own agent working on their behalf. If a buyer signs a contract to work exclusively with a specific REALTOR® that agent will work on behalf of the buyer to get the best deal while keeping all their client's private information confidential. As a buyer’s agent, I can show my clients any listed home in the Twin Cities metro. Best of all, it doesn’t cost anything additional to retain your own real estate agent when purchasing  because the fee is paid for by the seller of the home with a shared commission.

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READY to Make YOUR Move? It IS essential to have a knowledgeable agent at your side. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of BOARDMAN Realty, a call at 651-336-7073 or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2018 terieckholm.com

Essential Real Estate Terms: Fiduciary

Whether first time home buyer or seasoned homeowner considering selling, there are a number of real estate terms that are essential to know. Today's word is Fiduciary.

Fiduciary—A relationship of trust created when a home buyer or home seller signs a contract with a REALTOR®. After a contract is signed, a real estate agent has several fiduciary duties that protect their client, This fiduciary relationship is not only effective throughout the transaction; it continues forever. This means as a first time buyer, once a contract is signed with an agent, that agent cannot tell anyone anything that is private about you and your situation. In Minnesota, these duties require the agent to be loyal, confidential, and obedient with their client's lawful instructions. They are accountable to the client and must disclose any information they learn that would be of benefit in the purchase of a home. Throughout the transaction and afterward, they must use reasonable care to protect their client's interests.

It is important for a first time buyer to understand what a fiduciary is because every seller that is listed with a real estate broker already has a contract in place. This means when a buyer calls the listing agent for information or stops by at an open house, the friendly REALTOR® asking about your ability to buy a home is under contract with and WORKING for the SELLER. This agent has a fiduciary duty to disclose EVERYTHING you say to the seller of the home. But it is not a two way street. The friendly agent cannot tell you anything that the seller doesn’t want you to know (unless it is about the condition of the property). Because of their contract, the agent cannot say why the seller is moving or if a price reduction is in the works.

As a home buyer, it is essential to interview potential agents to assist with the home search as soon as possible in the process. When good match is found, sign a contract with a REALTOR® so that your interests and information are protected. Then your REALTOR® can make calls to other agents on homes, set up private showings and assist you through the homebuying process. The agent you sign a contract with will be working for YOU! 

What if you just met the agent and you are not certain you want to work with this particular person? The contract does not have to be a long term commitment. I often sign up new home buyers for a couple of weeks and extend the contract once we have formed a stronger relationship. Rest assured that even if you decide to part ways with your agent, the fiduciary duty to keep your private information private continues forever.


Need to know more about buying or selling an home in the Minneapolis/St Paul area? Let me be your professional guide. If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me, Teri Eckholm of Boardman Realty, a call or visit my website for a FREE Home Buyer Success Guide or FREE Home Value Report. 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 2015 www.terieckholm.com

Real Estate Word of the Day--Septic System

Buying a home is often a once or twice in a lifetime experience. There are often lots of things to learn. Buying a home on acreage has it's own set of unique terms that the average city-dweller might not have heard before. 

From time to time I am surprised that a simple term I use everyday as a REALTOR® is like a foreign language to some home buyers. It is not unusual to see a glazed look come into a buyer’s eyes when I talked about escrow or earnest money but also when I mention well water, septic systems and compliance tests. The confusion is totally understandable because most home buyers do not buy houses on acreage everyday.

There are so many terms that could possibly confuse a home buyer that I thought an online glossary of real estate terms might be helpful. So I am continuing my series of posts for the first time homebuyer with explanations of the most often used (and sometimes confusing) real estate terms. This way you can skip buying that big “how to buy a house” book or attending that First Time Home Buyer Class and have a quick resource at your fingertips. Today’s Real Estate Term is:

Septic System—If a home is not connected to a public sewer, there will be a private system that will hold and/or process the waste called a septic system. There are several types of systems. They can be a holding tank where all the waste must be pumped out or a tank that releases the waste water back into the environment via a drain field or mound. A private septic system can be owned by the individual property owner or shared by a number of homes. 

It is important to know what type of septic system is on a property. All systems will require maintenance but the type of system, indicates to a buyer how often the maintenance will have to take place and how much it will cost. Shared systems usually are part of an association where fees are collected on a periodic basis to pay for pumping out and maintaining the sewage system. 

It is also important to understand what can and cannot go into a private sewer system in order to keep it in the best condition possible. The cost to replace a private septic system can be in the tens of thousands of dollars. Proper maintenance and care can extend the life of the system by many years.  For additional information check out the University of Minnesota Extension Service's guide to Understanding Your Septic System.

 

Copyright 2014 www.terieckholm.com

Real Estate Word of the Day: Assessed Value

First Time Homebuyer Real Estate Word is Assessed Value

So many real estate terms can be confusing to home buyers and sellers alike whether it is an acronym like FSBO or an often used word like equity or foreclosure. As a REALTOR® I am not surprised when that look of confusion comes over a buyer’s eyes when I mentioned escrow or earnest money. These terms sound so much alike when being bombarded with new terminology like, mortgage, deed, easement, appraisal, and association dues, etc. It is understandable that homebuyers that are more interested in room sizes and kitchen counters to be confused with the everyday real estate jargon like down payment or cash to close. This confusion is very understandable because for most people, buying a home is a once in a lifetime experience.

This REALTOR® jargon is so prevalent, I thought a First Time Homebuyer glossary of real estate terms might be helpful. From time to time I have been adding to this list of terms used often by REALTORS® in a series of posts. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips. I am continuing the series with Today’s Real Estate Term:

Assessed Value (or Tax Value) Every home has a value assigned to it by the county assessor which is the assessed value. This value is updated on regular basis (usually once a year) and it is used for determining your property tax. This value should not be confused with an appraised value (value determined by an appraiser) or market value (value determined when listed on the market), since it is often a year or two out of date. Usually the assessor will determine a separate value for the land and the structures. This value does not add for landscaping which would be included in a values determined by appraisers and homebuyers.

 
Copyright 2013 www.terieckholm.com

Real Estate Word of the Day: Equity

From time to time I will be working with  home buyers and be struck by the confusion in their eyes when I talked about escrow or earnest money. These can easily be confused with other real estate and mortgage terms like down payment or cash to close. This confusion is a reminder that simple terms I use everyday as a REALTOR® might be unknown to others. It is totally understandable because most homebuyers do not buy houses everyday.
 
There are so many terms that could possibly confuse a first time home buyers and repeat home buyers alike, that I thought an online glossary of real estate terms might be helpful. From time to time, I have written about these essential terms. It is a series of posts for the first time home buyers where I explain some of the most often used (and sometimes confusing) real estate terms. This way you can skip buying that big “how to buy a house” book and have a quick resource at your fingertips. Today’s Real Estate Term is:

EQUITY—The amount of ownership one has in a property is the equity. This means if a home is appraised at $200,000 and the homeowner owes the bank $150,000, he would have $50,000 in equity.

An FHA buyer initially has very little equity because of the very low down payment required for the loan (usually 3.5%). Whereas a conventional buyer, who puts down 20% or more on the home, will have a greater percentage of equity.

It is important for a first time buyer to understand this term because it can be used in property descriptions. A home that is in a “negative equity" position is a short sale. This means the homeowner owes more to the bank than the home is worth in the current real estate market.
Other real estate ads will describe homes as an “equity builder”. This is where a buyer can build equity in the home faster by making improvements like finishing a basement so the home increases in value more quickly than if nothing is done on the home.

Another term used by REALTORS® in advertisements is “sweat equity”. This is similar to an equity builder but often describes a home that could need significant work to bring the property to its full value.



 

 
Copyright 2014 www.terieckholm.com
 

Real Estate Word of the Day for the First Time Homebuyer is Appraisal

First Time Homebuyer Real Estate Word is Appraisal

On a rerun of the TV game show, Cash Cab, a carload of New Yorkers were stumped when asked  to define the acronym, FSBO. This is a term often used in real estate to describe people who sell their home without an agent or "For Sale By Owner". As a REALTOR® I was a bit surprised they couldn't come up with the correct answer but then I  remembered of all the times a look of confusion came over a buyer’s face when I mentioned escrow funds and earnest money. These terms sound so much alike when being bombarded with new terminology like, mortgage, deed, easement, appraisal, and association dues, etc. It is understandable that a buyer who is more interested in room sizes and kitchen counters to be confused with the everyday real estate jargon like down payment or cash to close. Buyer confusion is totally understandable because most people will only buy a home once or twice in a lifetime.

FSBO is only one of many terms that could possibly confuse a First Time Homebuyer. So I thought a glossary of real estate terms might be helpful. From time to time I present terms often used by REALTORS® in a series of posts for the first time homebuyer with explanations. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips. I am continuing the series with Today’s Real Estate Term:

Appraisal An appraisal is the process of assessing a value to a parcel of real estate. A real estate appraiser is an independent 3^rd party who will assess the property and prepare a valuation report. This is most often ordered by the buyer’s lender and paid for by the home buyer to verify the amount the buyer is requesting for the mortgage is not more than the current value of the home. The appraiser will try to find three to six comparable homes that have been sold in the last few months to compare to the subject home. The process involves comparing the size, structure, age and features of the subject home/land to the comparable sold homes to determine an appraised value.

An appraisal is similar to a market analysis performed by a real estate agent but it does differ in several key ways. A real estate agent does a market analysis at the request of a seller to determine the best price to list a home. It will take into account homes that are currently listed for sale but an appraisal will not. Appraisers are often licensed and trained to do a precise, detailed value analysis while the market comparison done by a real estate agent is used to determine a price. While an appraiser will charge a fee of several hundred dollars to appraise a property, most real estate agents do not charge a fee to provide a market analysis of a home. A market analysis can be a cost effective way for a homeowner to get value of their home if offered for sale but this document is not acceptable to verify value for a mortgage.

Copyright 2013 www.terieckholm.com

First Time Homebuyer’s Word of the Day is Earnest Money

In an episode of Cash Cab, a television quiz show that takes place in the back seat of a New York City taxicab, a family was stumped by the acronym, FSBO. This is a often term used in real estate to describe a person selling their home by owner (For Sale By Owner). As a REALTOR® I was a bit surprised that such a simple term I use everyday would be unknown to so many. But then it got me thinking of all the times a glazed look came over a buyer’s eyes when I talked about escrow or earnest money. These can easily be confused with other real estate and mortgage terms like down payment or cash to close. It is totally understandable because most homebuyers do not buy houses everyday.

There are so many terms that could possibly confuse a First Time Homebuyer that I thought an online glossary of real estate terms might be helpful. So I have an ongoing series of posts for the first time homebuyer with explanations of the most often used (and sometimes confusing) real estate terms. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips. Today’s Real Estate Term is:

Earnest money The funds that a buyer submits with their offer or purchase agreement to demonstrate to the seller their seriousness about buying the property. 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. It is not the same as a down payment. If your offer on the home is accepted, the earnest money check will be cashed and placed into a broker’s trust account. The funds will go toward the purchase price of the home.

Copyright 2012 terieckholm.com

First Time Homebuyer’s Real Estate Word for Today is Earnest Money

It may be hard to believe that the acronym FSBO could stump a game show contestant. But in an episode of the Emmy award winning television show, Cash Cab, a taxi full of New Yorkers couldn't come up with the answer. FSBO is a often term often used in the real estate world to describe a person selling their home by owner (For Sale By Owner). As a REALTOR® I was surprised that such a simple term I use everyday would be unknown to so many. But then it got me thinking of all the times a glazed look came over a buyer’s eyes when I talked about escrow or earnest money. These can easily be confused with other real estate and mortgage terms like down payment or cash to close. It is totally understandable because most homebuyers do not buy houses everyday.

There are so many terms that could possibly confuse a First Time Homebuyer that I thought an online glossary of real estate terms might be helpful. So over the next few weeks I am going to have a series of posts for the first time homebuyer with explanations of the most often used (and sometimes confusing) real estate terms. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips.  

Today’s Real Estate Term is:

Earnest money The funds that a buyer submits with their offer or purchase agreement to demonstrate to the seller their seriousness about buying the property. 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. It is not the same as a down payment. If your offer on the home is accepted, the earnest money check will be cashed and placed into a broker’s trust account. The funds will go toward the purchase price of the home.

Copyright 2012 Teri Eckholm

First Time Homebuyer’s Real Estate Word for Today is Appraisal

First Time Homebuyer Real Estate Word is Appraisal

In a past episode of Cash Cab, an Emmy award winning television game show that takes place in a NYC taxicab, a carload of contestants were struggled to define the acronym, FSBO. This is a term often used in the real estate world to describe a person selling their home by owner (For Sale By Owner). As a REALTOR® I was a bit surprised but then I started to remember of all the times a look of confusion came over a buyer’s eyes when I mentioned escrow or earnest money. These terms sound so much alike when being bombarded with new terminology like, mortgage, deed, easement, appraisal, and association dues, etc. It is understandable that a buyer who is more interested in room sizes and kitchen counters to be confused with the everyday real estate jargon like down payment or cash to close. Buyer confusion is totally understandable because afterall for most people, buying a home is a once or twice in a lifetime experience.

This is only one of many terms that could possibly confuse a First Time Homebuyer so I thought a glossary of real estate terms might be helpful. For the past several weeks I have presented terms often used by REALTORS® in a series of posts for the first time homebuyer with explanations. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips. I am continuing the series with Today’s Real Estate Term:

Appraisal An appraisal is the process of determining the value of a parcel of real estate at a particular point in time. A real estate appraiser is an independent 3^rd party who will assess the property and prepare a valuation report. This is most often ordered by the buyer’s lender and paid for by the home buyer to verify the amount the buyer is requesting for the mortgage is not more than the current value of the home. The appraiser will try to find three to six comparable homes that have been sold in the last few months to compare to the subject home. The process involves comparing the size, structure, age and features of the subject home/land to the comparable sold homes to determine an appraised value.

An appraisal is similar to a market analysis performed by a real estate agent but it does differ in several key ways. A real estate agent does a market analysis at the request of a seller to determine the best price to list a home. It will take into account homes that are currently listed for sale but an appraisal will not. Appraisers are often licensed and trained to do a precise, detailed value analysis while the market comparison done by a real estate agent is used to determine a price. While an appraiser will charge a fee of several hundred dollars to appraise a property, most real estate agents do not charge a fee to provide a market analysis of a home. A market analysis can be a cost effective way for a homeowner to get value of their home if offered for sale but this document is not acceptable to verify value for a mortgage.

Copyright 2011www.terieckholm.com

First Time Homebuyer's Word of the Day is Buyer's Agent

The average home buyer only buys a home once every eight years. That said, even a repeat home buyer can forget some of the simple terms used in real estate on a daily basis. It can be hard to remember whether the earnest money or the money escrowed is a down payment and (if it is, on what?) Often buyers are easily confused by similar sounding terms like easement and encroachment as they both deal with property lines and usage but what do they really mean?

Whether you are a novice, first time buyer or someone who hasn’t purchased a home for several years, sometimes a refresher on real estate terms can be very helpful. I often notice buyers (and sellers) with a glazed look on their face when certain terms come up so I thought an online real estate glossary would be helpful. The real estate term for today is:

Buyer’s Agent An individual contracted by the buyers to represent them in the purchase of their home.

When buying a house, the home is listed by a broker or company. The REALTOR® that lists the home is the listing agent for the home and is under contract with fiduciary duties to the seller. When a buyer calls on a sign or enters an open house, the information they provide is shared with the seller because the listing agent is required to disclose all information to their client.

A buyer can have their own representation when purchasing a home. They do not have to work with the listing agent. In fact, many buyers prefer to have their own agent working on their behalf. If a buyer signs a contract to work exclusively with a specific REALTOR® that agent will work on behalf of the buyer to get the best deal while keeping all private information confidential. A buyer’s agent can show their clients any listed home and it doesn’t cost anything to hire your own agent because the fee is paid for by the seller of the home with a shared commission.

Copyright 2011 www.terieckholm.com

First Time Homebuyer’s Real Estate Word for Today is Encroachment

In a recent episode of the Emmy award winning television show, Cash Cab, several people with stumped by the acronym, FSBO. This is a term often used in the real estate world to describe a person selling their home by owner (For Sale By Owner). As a REALTOR® I was a bit surprised but then I started to remember of all the times a glazed look came over a buyer’s eyes when I talked about escrow or earnest money. These can easily be confused with other real estate and mortgage terms like down payment or cash to close. It is totally understandable because homebuyers do not buy houses everyday.

There are so many terms that could possibly confuse a First Time Homebuyer that I thought a glossary of real estate terms might be helpful. So over the next few weeks I am going to have a series of posts for the first time homebuyer with explanations of the most often used (and sometimes confusing) real estate terms. This way you can skip buying that big “how to buy a house” book or attending that First Time Homebuyer Class and have a quick resource at your fingertips. Today’s Real Estate Term is:
Encroachment—An encroachment is when something owned or constructed by a neighbor extends beyond the property line and onto another land owner’s property. Examples of common encroachments are fences, paths and branches of overgrown trees. Known encroachments must be disclosed by the seller on the Minnesota Seller’s Property Disclosure Statement (unless the buyer agrees in writing to an alternative inspection report or no disclosure).

Sometimes there is a reason for an encroachment. Trees often grow and will encroach into a neighbor’s yard. This usually isn’t a problem unless a branch was to break and cause damage in the neighboring yard.

There are times when a homeowner may not be aware of the encroachment because at the time of the construction the builder “guessed” at the property line or the survey was incorrect. It is common for an encroachment to be discovered when a new survey has been completed. A conflict can arise when it is discovered that a fence or shed has been constructed “on” or “near” what was thought to be the property line, but is actually over the line and encroaching on the neighbor’s property. The structure owner can then be required to move or remove the structure which can be very costly. Most communities will require a permit before construction and a setback to avoid these situations.

Copyright 2010 Teri Eckholm http://www.terieckholm.com/