Thanks for all you do to make our business a success.
Merry Christmas and many blessings for 2012!
I was recently contacted by a past client in regards to a mold problem they were experiencing. It had been two years since I completed their home inspection, and they found documentation that revealed the bank had performed some water damage remediation prior to the sale of the home.
Fungus Damage
Convinced that something was awry, they wanted me to determine what was the cause of their problem. Upon arrival, I was directed to the master bedroom closet located downstairs. In the ceiling near the exterior wall was a 1-foot-square area with fungus damage. A bathroom was not located above this area, so the cause of the damage was not immediately apparent. The client did mention that the impacted area had slowly grown in size over the course of several months.
Damaged DryerDuct
While investigating the outside of the home, I noted the dryer duct vent cap exiting between the floors.The vent cap had been cut open and the flap that prevents vermin from entering the duct area was missing. The client indicated that he had recently replaced the dryer, and during the process discovered the duct was clogged and needed cleaning. I noticed a small amount of grass at the edge of the duct. With a ladder and a 4-foot fishing pole, I proceeded to pull out a world record bird’s nest. This nest was nearly 4 feet long and was sopping wet. As the moist, warm air traveled through the nest, it condensated and eventually seeped out into the ceiling area, causing the fungus damage. This probably turned out to be a blessing in disguise. Normally, the lint buildup eventually either burns out the dryer (which is probably what happened to the first dryer) or worse, causes a duct fire.
World Record Bird Nest
Every year, over 10,000 fires are caused by dryer ducts and result in otherwise preventable deaths and injuries. Hundreds of thousands of dollars in property damage are also attributed to this deferred maintence item. Damage can range from something minimal, such as a burned up dryer, to complete loss of structures. One of the first indications that your dryer duct is clogged is that your dryer no longer seems to be drying as efficiently as it used to. In addition, vertically routed dryer ducts and/or faulty or unregulated lint traps increase the likelihood of clogging. If you suspect that your dryer duct is clogged, then it is important to inspect it. Pulling out the dryer and disconnecting the duct will usually give some indication if it’s clogged. If you need to have it cleaned, you can find the necessary tools at your local home improvement store, or it can be cleaned out professionally for around 250 dollars. I have provided links below to more info for you to utilize.
Good luck and be safe!
Ron
http://www.cpsc.gov/cpscpub/pubs/5022.html
http://www.amazon.com/Brushtech-B68C-10-Feet-Dryer-Cleaning/dp/B000RL6HFY
Does any one know who David H. Stephens is? Up until April of this year he was the Assistant Secratary of FHA. He was the one who drafted the waiver for the 90 day flip rule we first heard about in January of 2010 that was put into effect 2/1/2010 and extended earlier this year. Has anyone ever seen a copy of those guidelines? I didn’t think so. Judging from the amount of confusion I see during this process it has become apparent that most mortgage brokers haven’t read it either. Its time that we let the cat out of the bag. Here are a few of the questions answered.
Why do you need a second appraisal?
You don’t! The lender does and they have to pay for it. The lender is only required to have a second appraisal if the seller is profiting more then 20% of the acquisition price. This is done in conjunction with other things to prove to the underwriter why the seller is profiting over 20%. The seller isn’t allowed to profit more then this unless they can show where they had to spend this money to rehab the property. Its up to the lender to put this documentation together and to also pay for the second appraisal. NOT THE BUYER!
Why do I need a home inspection?
You don’t! Again, if the profit margin is over 20% then the lender is required to have a home inspection completed and can request the buyer to pay for it. All areas of the home must be inspected; but guess what? The guidelines specifically say that only “structural and health and safety concerns must be addressed”. So even though we do an inspection, a second report can be written addressing those issues and turned over to the underwriter so that a request for repairs can be made. There are no specific details of this inspection listed or the format in which it has to be written in the waiver guidelines.
Who has to order the home inspection?
The lender, the seller, or the buyer can order the home inspection. The lender can request that the buyer pay for it and a copy of the report must be given to the buyer regardless of who orders the inspection. I suppose in California this shouldn’t be an issue with our disclosure laws.
I know this is going to stir the pot up a little. SO WHAT! Some of the buyers out there may be entitled to a refund from the lender for paying for the second appraisal even though it should have not been. It may be possible that some of the properties don’t even go over the 20% profit margin. Maybe the lender is requiring repairs to be made that aren’t required under the guidelines. Its already ridiculous that an investor who buys a property off the courthouse steps sight unseen and forks out his own money to rehab it would be put under a more stringent requirement then the bank places on itself when it sells some dilapidated property to a first time home buyer “AS IS” with no restrictions other then some walk through done by an appraiser who in most situations doesn’t have guidelines of his/her own. My goal is to have some consistency in this process. Something that I see a total lack of. I am not sure if agents have actually ever seen a copy of the waiver and its guidelines. At the end of 2010 the FHA opened this area up for comments with industry professionals before extending the waiver. 8 people responded! I have posted links to both the original draft and the extension below in PDF format. Read them carefully and know your business.
KNOWLEDGE IS POWER!
Original Flip Waiver
Current Flip Waiver
10 Tips from 10 Experts
by Julie Escobar
www.ProspectsPLUS.com
Ten experts share their smartest survival strategies for today’s market
“The smart ones ask when they don’t know. And sometimes when they do.” Consider these wise words from Malcolm Forbes, a man who clearly knows a thing or two about surviving financial storms.
Isn’t that what we’re supposed to do when we don’t know, are facing adversity or are in over our heads? Heck, isn’t that even what we’re supposed to do to get ahead of the curve during tough times and be positioned for greatness when the tide starts to turn?
I think so, so I did. I asked: “What’s the SMARTEST thing agents can do to build their business in today’s market?” Fortunately for all of us, 10 of the top minds in the industry answered.
Here is what our special guests—Floyd Wickman, Bill Barrett, Darryl Davis, Carol Johnson, Mr. Internet®-Michael Russer, Matthew Ferry, Walter Sanford, Dave Beson, Claudia Wicks and Judy LaDeur—had to say about the smartest thing you can do to build your business now.
1. Industry icon Floyd Wickman: Well, I believe that’s a three-part formula. First, work each week (we could stop there and increase production by 38%)… on bringing in saleable listings. That means getting face to face with a seller for a listing or price reduction. Next, get all buyers and lookers into the office to be qualified, and sell them on the benefits of the office like you never have before. Last, sell in-house inventory first!
2. Industry icon Dave Beson: Focus on filling the prospect pipeline and improving your presentation so that when you get in front of a “live one,” you will win! If you aren’t pre-planning your day and including an hour or more of prospecting by phone, in person, by letter, by email, by postcard and follow up, then you’re missing the boat. I tell my audiences, “You have to be a missionary for real estate.”
The easiest thing to do is to tell a success story—just one—about a couple who kept their house or a family that WAS ABLE TO BUY because of your help. If you need to share a story with someone in the office, that’s okay. I have a letter that I suggest agents send out to everyone they know. It’s cool to follow up by phone, too, even if it’s just to leave a voice mail! Here it is:
Dear Bob and Mary,
I just reviewed my business for the year and found an amazing surprise: More than 61% of my business was past customers, referrals and repeat business.
Sure, it’s been a challenging time in real estate, but where would I be without the support of important people like you and your friends? Many thanks for telling your friends about me, and me about them.
Be sure to let me know if there is anything I can do to help you or a friend.
All the best,
Your Name
Get in touch, and stay in touch–consistently. That’s key.
3. Real estate and trends expert Bill Barrett: DO NOT CUT BACK ON YOUR BUDGET! Keep in touch with your past customers—meaning ALL of your past buyers and sellers—on a monthly basis. Superstars get 80% to 90% of their business from past customers through continuous prospecting and marketing. Consider that we’re still on track to sell four million re-sales nationwide this year. Who’s going to sell them? Certainly not the ones who “give up.” Stay in the game.
4. Noted speaker Darryl Davis: I believe the best thing about this market is that we will see a flood of buyers coming out. Sellers who were waiting in the wings to sell their houses and buyers who were sitting in the wings waiting for rock bottom all will start to move as we see our market start to inch up. Remember: The agent with the most listings WINS! If I were to gamble, I would say things will be on the upswing starting this spring. So prepare for the surge of buyers by building your listing inventory NOW!
5. Recruiting pioneer Carol Johnson: Stay in constant communication with your book of business, customer base and centers of influence. There is a market–people are buying and selling! This is a good time to make a change. It’s also a great time to develop new niche markets. Property condition is paramount right now—properties need to be in good condition, and prices have to be right. Make your listings the most compelling properties on the market!
6. Mr. Internet®, Michael Russer: I would have to say, launch your e-team. E-team members specialize and differentiate themselves by targeting a niche. 90% of agents don’t do this, which forces them to compete with everyone. Specialists know that they must always effectively answer the question, “What’s in it for me?” for every client.
7. Industry coach Matthew Ferry: For agents, I would say that they need to find that faith they had in themselves before. I’m doing a webinar for all of my clients that includes a six-point action plan to help them find the courage and strength to make 2009 their best year yet. It takes honesty—about finances, about whether this industry is the right industry, and about resentment and anger. These mindsets and energies have a very damaging effect on productivity. People know what to do, they just don’t do it. They don’t do it because of hidden negativity in their mindsets. This must be discovered and removed.
For brokers, I would have to tell them to get to the heart of each agent’s passion and purpose. Most people are focused on what doesn’t work about life right now and, consequently, draw from that energy to make decisions. This is very detrimental and will pull you further into a mental breakdown. The key is to discover the future you are committed to and get focused on that. Everyone is operating in relation to the future they are present to. If you are in despair, then you are present to a bleak future. If you are empowered, then you are present to a future that you are looking forward to. Today’s action is a function of the future.
8. Real estate expert Walter Sanford: Short and simple: “Triple (at least) your current listing inventory.” This positions you to win when the market turns.
9.Speaker and trainer Claudia Wicks: Learn online marketing and how to use the technology tools consumers are using. You need to have an online presence and, of course, develop a database of prospects. Establish relationships with more prospects than ever before. Collect email addresses; use tech tools to stay in touch automatically until they are ready to buy and/or sell, and stay in touch with past clients.
According to NAR, many agents have been in the business seven years or less. They have never known this type of market. They do not know what to do to generate business. Agents who have developed a large database of prospects, however, are not struggling. They have a steady stream of business. In this market, you need to get down to basics and build your business. That means generating prospects. You can do it by talking to everyone you know and asking for business by networking and letting everyone know it is a great time to buy. You also can do it by creating an online presence and branding yourself by marketing your own web site, blogging, joining social networks, and responding immediately to online requests for info.
Show up every day, and start working. Stay motivated by doing something nice for someone else, by talking to past clients, and by watching how you talk to yourself and not listening or “buying into” all of the negative talk. You can do it by believing in yourself
Brokers and managers, the smartest thing YOU can do is provide training and encourage new skill building for your agents. Keep them engaged in productive activities such as networking opportunities, open houses involving the entire office or office tour of homes, or showing them how to market their listings online. I’d also suggest having “call nights” where they call past clients to stay in touch. Also provide them with valuable information such as:
which price ranges are selling, list price to sales price, days on market
how to handle issues that arise at closing
how to work with appraisers to help ascertain value
what type of financing is available
good news at the office such as new listings, sales and price reductions
short sale help
foreclosure information
how to get a price reduction
how to help get a listing in good condition or staged
10. Recruiting guru Judy LaDeur: Agents, DO NOT read the newspapers, and please turn the TV off! Agents are glued to TVs and reading papers like never before, just looking for the gloom and doom. I say, “Ignore the press!” There are opportunities in every market, and the agents who are finding them are having a great year in real estate! This is a great time for apartment renters to buy homes. It also is a great time for sellers in a starter price range to move up to their dream home. Price homes correctly, and stage them well. Homes are still selling! If you have listings that are not priced and staged correctly, get rid of them!
Brokers and managers, I’d tell you to first trim the fat! That means look at your costs, and see where you can cut back. You also should look at your agents, and trim a few of those as well. Most brokers right now are carrying agents who need to be out of the business. Those agents drain your office resources and staff.
I’d also tell you that there has never been a better time to recruit! Many agents are unhappy and looking for options. The brokers and recruiters we’re coaching right now are having record-breaking recruiting years because they pick up the phone every day and talk to agents. In this market, if you are not recruiting, you will not survive!
And the last bit of advice is the same advice that I gave the agents. DO NOT read the newspapers, and turn the TV off! We are coaching several brokers who have doubled the size of their office this year by ignoring the press. If anything really bad happens, you will know about it soon enough. All of your friends who are glued to the TV will call and tell you what is going on! So stay focused, and keep moving forward!
Thanks to all of our extraordinary panelists for their extraordinary answers! When it comes to “asking” for help, you’ll find this “dream team” of experts to be a resource you can turn to and rely on every time.
Fishing in Another Stream
by Carmel Streater
www.carmelstreater.net
If your traditional stream of buyers has temporarily dried up it may be time to drop a line into another stream.
You’ve been hearing about diversity for a good while now, but if you haven’t seriously considered working with buyers from cultural groups different from your own now may be a good time to take a hard look at what’s going on in some of the less familiar portions of your market area.
If you’re thinking that sounds like work, give yourself a gold star. It takes not only work, but often a serious attitude adjustment to successfully represent buyers (and sellers!) from cultures not your own. This is true if you are a mainstream, white-bread American of European descent, but it is equally true if you belong to another cultural group and decide to try your luck with traditional consumers.
There’s a lot to learn when cultural barriers are breached by outsiders, but success doesn’t necessarily mean abdicating your personal cultural values. To the contrary, it may mean simply communicating to individuals from other cultures that you accept them and value their culture equally with your own. Ah, so easy to say; so hard to do!
Rule number one is that persons in other cultural groups can actually tell if you’re sincere in your acceptance of them. They can also tell if you’re in it strictly for the money, an attitude that doesn’t play well in any culture. You don’t have to learn a new language, but it is very important to learn what is important to buyers from different cultures. Please note that if the “from different cultures” is removed from the previous statement it becomes Real Estate Sales 101!
Think of the difference between the wish lists of first time buyers and empty nesters! The trick here is to remember that what is important to buyers may vary from culture to culture. In fact, there are actually cultures in which couples seek out properties as near as possible to their parents and/or in laws. This is not a traditional, mainstream American choice so be careful about the mother-in-law jokes, either pro or con.
You can learn a lot about different cultures from attending church services or community events in their neighborhoods and simply listening. These are learning opportunities that cost little or nothing and can literally be worth thousands to you, even if all you learn is that you and the cultural group are not a good match.
Fortunately for us, we are currently blessed with a large and widely varies number of cultural groups in this country. It’s statistically impossible for you to not find at least one culture besides your own that will accept you. As far as I know, all cultures look favorably on hard workers who want their business and will work to get and keep it.
Good luck with your ventures into your personal unknown. I’d love to hear your stories!