Tag Archives: real estate

Choose Your Broker Wisely

In my day to day encounters with real estate agents and the public alike I have people frequently ask me what makes Prudential PenFed Realty different. New agents oftentimes ask why they should work with a company with a commission structure such as ours when other companies offer 100% commission splits for a small monthly and per transaction fee. One thing that many people simply do not put a high enough value on is having a broker that has solid industry experience. So many times I see cases brought before the board that really could be avoided if the agent simply had some strong guideance.  Each time I see one of these cases I keep remembering this article written by Florence Daniels, a long time leader in the real estate community, entitled Choose Your Broker Wisely.

After a recent incident where an agent I know personally could have landed in a bunch of trouble I went and dug up an old copy of the VAR newsletter to keep handy.  Florence says it so much better than I can.  I hope you enjoy the read.

This article is not written to bash brokers but to give a wake-up call to salespersons that remain with brokers who fail to provide adequate training and supervision. Although this article is directed primarily to new salespersons, it will also benefit experienced salespersons.

The Board has considered a number of recent disciplinary cases involving salespersons who violated one or more of the Board’s laws and regulations. In many of these cases, the salespersons claimed that the violation(s) occurred because their brokers did not train them properly or prepare them for the unique set of circumstances that led to the disciplinary action.

This claim carries little weight with the Board. All salespersons are responsible for choosing a broker who will help them avoid risky decisions that could lead to disciplinary action or harmful civil consequences.

During the past five years the real estate profession has witnessed a proliferation of real estate business models which provide different levels of services. No longer is the traditional brokerage firm offering “full service” real estate services the only game in town. Many non-traditional firms now offer “limited” real estate services. Salespersons now have the choice of working with a traditional or non-traditional firm.

Unfortunately, many new salespersons choose the glittering prospect of fast money over building a solid clientele through rigorous training, hard work and sound business practices. Salespersons whose top priority is more compensation or a higher split often fail to seek a broker and firm that would provide the requisite training to enable them to become competent well-rounded real estate professionals.

There are a number of important reasons for a salesperson to choose a broker who values training and supervision. First, new salespersons are generally inexperienced and subject to numerous potential traps associated with the complexity of the real estate business. Rigorous and effective hands-on training can help new salespersons avoid these traps and help them develop into competent real estate professionals. Many firms have their own real estate schools or mentoring programs to accomplish this.

If these options are unavailable, new salespersons still must select a broker who will help them understand complex real estate transaction documents, office policy, how to handle the money or deposits of others, real estate laws and regulations, agency and limited service agency, fair housing laws, how to conduct a listing appointment, and the multitude of principles, practices and nuances involved in real estate.

New salespersons should not expect to learn all this on their own – there is just too much to learn. A broker should be there to train and guide the salesperson, and the salesperson must expect this from their broker. After all, the broker will usually share in any compensation that is generated from the salesperson’s efforts.

As licensees, we should all strive to update our knowledge. And as we continue to learn, our businesses will grow. And most important, we will serve our client base well and reap the referrals for such exceptional service and knowledge.

Purchase Your First Home with Confidence

This is a little article I had published in the Alexandria Times a while back… the information is still as relevant today as it was when the paper featured the story.

If you are considering purchasing your own home, your timing is great. Interest rates are still at historic lows and the market has shifted to favor the buyer. Now is a great time to buy a home! While purchasing a home and making one of the largest investments of your life can easily be a daunting and overwhelming undertaking, if you go into the process well prepared and with the right support, your first home purchase can be a great experience. Here are some tips from a seasoned professional that should get you off one the right footing.

Get Educated – Before starting out, educate yourself a little bit on the process. Believe me, it is a whole lot less daunting when you at least have an idea of what to expect. Check your local bookstore, or go online, to find one or more many good “how to” instruction guides on buying a home. For example, the U.S. Department of Housing and Urban Development has an entire section on its website (www.hud.gov) devoted to homebuyers. It has a list of common questions from first-time homebuyers, information on mortgage and home-buying programs, access to housing counselors, downloadable tools such as a wish list and home-shopping checklist, tips on selecting a real estate professional, etc. Other informative sites to check out are http://www.Realtor.com and one of my personal favorites, iAlexandriaHomes.com. In addition to printed resources, you should also consider some face-to-face education, which you could find by checking your local newspaper for homebuyer seminars that you can attend. And, of course, you should expect to receive no end of information and education from your real estate agent.

Your real estate professional is also a great resource. Your agent’s job is not only to help you find the right house but to educate you on the home buying process. Do not hesitate to let him or her know that you are new to the process. Your agent will walk you through the steps of the home buying process and help you navigate what would otherwise be a very confusing maze. Your agent expects you to have questions at each step-from house hunting, to making an offer to the closing.

Money Matters – The finances involved in the purchase of a home can be overwhelming to first-time homebuyers and seasoned purchasers alike. Buying a home is often the largest purchase someone will ever make… until he or she goes through the whole process again and buys his or her second, or third, or even forth home. There are questions of affordability, mortgage costs, down payment, closing costs, and making offers to think about.

Affordability – There are mortgage costs, the down payment, and closing costs to think about. By looking at your income and debt ratio, your sales professional can help you calculate how much you can afford each month in mortgage payments. But before determining your price range, you should also take into consideration other factors that will affect your monthly budget once you are a homeowner, such as property taxes, insurance, utilities, and maintenance.

Pre-Approval – Fear of being rejected for a home loan is one of the main concerns for first-time homebuyers and not something you want to be worrying about when looking at homes. To lessen the stress and to make you a more effective negotiator, you will want to get pre-approved for your loan before looking at prospective homes. This pre-approval process is quick and painless and usually only takes a few minutes of your time. Being pre-approved by a lender will not only help you feel more confident, it will also give you an advantage during negotiations. In addition, the fact that your loan has already been approved is of great value to the seller because it shortens the purchase process, and there is less of a chance that the buyer will back out of the sale. If you don’t have a specific mortgage lender in mind, ask your sales professional for a recommendation or two.

Down payment – The down payment amount varies depending on the value of the home you choose and your mortgage lender. The traditional 20% down payment rule is not so much the norm anymore for homebuyers. Often times it is closer to 10% down, and in some a home can be purchased with no money down. Your real estate agent and mortgage lender will be able to explain the different options available to you and help you figure out what makes the most sense for your situation.

Take Your Time – Do not feel pressured into making an offer on the first home you see but do not pressure yourself into looking at every single house for sale. These two extremes are common mistakes of many first-time homebuyers. You want to make sure you view enough homes that you are able to get a feel for the marketplace but you do not want to view so many that you skip over the perfect home. Your agent knows and appreciates the fact the process takes time and should encourage you to move at a pace with which you are comfortable. With the right support and professional resources, and a little invested time and energy on your part, the American dream will come true for you too.

Above all, remember there are no silly questions. Make sure you understand and are comfortable with every aspect of the transaction. Your real estate professional can be an invaluable asset in helping you make educated decisions so that your first home purchase is a rewarding experience.

Questions?  Please feel free to ask.