Solving the Mortgage Crisis-A Solution…

Solving the Mortgage Crisis

The Simple Answer is amend the DUE ON SALE CLAUSE!

The shortest distance between two points is a straight line. Actually, it’s a line segment connecting point A to point B. It can get more complex but for the purposes of SOLVING THE MORTGAGE CRISIS, their is simple answer.

PLEASE explain to your elected representatives that a surgical assault  that may help in solving the mortgage crisis is to amend the mandatory, “DUE ON SALE CLAUSE” which currently forces home sellers to either come up with funds to close or be forced by banks to short-sell their homes or even worse FORECLOSE.

Sellers, especially those relocating to a new job and must sell, would rather take a low interest rate loan, say 1%, secured/underwritten by the US government (similar to student loans) than sell short and have their credit recked. This low interest loan with installments payments over 10, 15, 20, or even 30 years, for the difference between what the home sells for and what is owed should be issued in exchange for credit score retention. Doing so would  increase the numbers of ready, willing and able buyers in the pool and would position these folks well to repurchase once they’ve relocated.

Currently, sellers are being forced by banks and to sell short. Folks with otherwise perfect credit scores who are willing to take on debt in lieu of sellinmg short are not given an option to do so until after being foreced through the short-sale process by mortgage holders. Our government, of the people, for the people, by the people in lieu of helping consumers has opted to supply banks cheap money when they could just as easily make those dollars available for qualified transactions. As jobs shift and sellers move by necessity to find new employment, they are being forced to sell short by banks who are unwilling to provide low cost loans for the difference between what is owed and what the home sells for—a loan that any seller, who is current on their mortgage, could apply for and simply sign at the closing in conjunction with a sale. 

In order for banks and sellers to avoid short sales and foreclosures PLEASE demand that elected official vote to amend DUE ON SALE and provide low interest loans government secured loans to sellers NOW.

If this “AMENDED” due on sale clause provision existed, banks wouldn’t need to write down loans but would instead issue low cost long-term loans secured by the government in conjunction with a closing.

Sellers would then be motivated to sell their homes for the highest possible price to reduce the amount of loan they’d have to carry after the closing.  Banks and the government would make money through the issuance of loans to those who are current on their mortgages and Sellers’ credit score and history wouldn’t be damaged which in-turn would allow them to turn around and purchase a new home and thereby accelerating the absorption rate.

Simple answers to complex questions are not always easy to find but in this case, the shortest distance is the straight line.

How we do the things we do, to market homes

Seldom a week goes by when I’m not asked how I do the things I do to market homes. I always struggle to answer concisely. I’ve learned that it’s just as important to know where the agent asking the question is coming from as it is to answering the question itself.  In fact, it is vital to the conversation and pertinent as well.

I once heard a John Tenza, a RE trainer, say “Anything you can say, I can ASK better“.

So I’ve learned to turn the table and to ask probing questions of the questioner in order to discover the essence of their question. I want to know why they are asking the question before answering it.

It is in the ‘why’ that the need is discoverable and to answer anything you need to know the ‘need’.

To that end, I’m going to make some assumptions here about my audience. I’m going to assume that for some of you a nugget is all that’s needed and for others clear direction.

In either case, Enjoy!

 

 7  Things I do to Market homes

Step # 1

Get 7-10 qualified appointments per week It doesn’t really matter how you get the appointments. I’ve discovered that every system works when I do. A qualified appointment is an appointment with someone who wants to buy or sell a home in the next 90 days. All other appointments are important because you have to ‘circulate to percolate’ but they don’t fall into the ‘qualified’ category yet. 

Step # 2

Speak the truth When ask about the market or value of a home, speak the truth. In order to do so you have to be aware of what the truth is. I stay ’on-top of the market’ and understand the mood of the market. Begin by understanding values, types of homes, neighborhoods, what constitutes a good home from a great home,  and understanding the needs and wants of your clients and if you do so you’ll be equipped to speak the truth and it will be well received.

Step # 3

Apply yourself  fully to the task at hand Planning requires full concentration. Begin with the end in mind and work backwards. So if your goal is 7-10 qualified appointments per week, you first need to decide  what you need to do to get appointments. Ask yourself, How am I going to get 7-10 qualified appointments per week?  Depending on what systems you ALREADY have in place will determine much of the how. Assuming you have no systems at all, don’t begin building systems. Too many agents get caught up in system building to the detriment of achieving the primary goal, getting appointments. Instead, be creative. i.e., do a great OH, call your Sphere of Influence, Creat a video using a webcam and post it on Youtube and then send everyone you know a link to it, etc..Don’t spend money, spend time and creative energy and you’ll get results.

Here are some things I did:

When I first got started, I sent a simple note to the members of my Church. It said something like, ‘I just became a REALTOR(R), pray for me’.  It was sincere and it worked.

Then I did open houses sometimes as many as 3 a day. Listen, FOCUS on the objective, getting appointments and remember that all systems work, when you do.  I’ve learned that ‘Face Time’ is really important, so my suggestion is  to get out from behind the desk and ‘circulate to percolate’. 

Put yourself in a ‘target rich’ environment.

In the beginning Church, kids school events, open houses and floor time is where most my appointments originated from.

Today, for me, Church, online-leads, listing syndication, reciprocity networking ( i.e. if I pay anyone to do anything, I ask for a reciprocal relationship) drip email, open houses and social networking are my primary means of getting appointments. In all these arenas, I apply myself fully to the task at hand.

Step # 4

Be efficient Call me frugal but I’ve found that being efficient saves time and money.  Early in my career, as I began to gather a little steam, a technique I used was to set up MLS searches, both Active and Sold searches, for just about eveyone I knew–buyers and sellers and even closed buyers and sellers, friends and family, etc..This is a simple and FREE technique that will enable you to stay in front of your folks…I thought, ‘why should I pay for a drip email campaign when I have immediate access to the information that these folks want at my finger tips? ’

Another technique had to do with open houses. Open houses are essentially ‘launch platforms’ for your business. 

Again, begin with the end in mind and think efficiency and productive time.

First- Choose a location that is ’RIPE’ for an open house. DON’T allow the big shooter in your office to place you out in the sticks, unless you need quiet time. Second-Group open houses so that there are a variety of  them being held at the same time and contact the other agents in the area and encourage them to hold their home open as well. Third- Send out invites to 100 neighbors. Fourth-Be sure to put a rider and fliers on the sign and in the yard 1 week in advance of the open house. Fifth- Post the Open House ad on all available Websites and in the Newspaper. Sixth-email your base to let them know about the open house and HAVE your clients do the same. Seventh-Be sure you place MANY directional signs. Eighth- Brew Flavored Coffee  and have cookies made (Have your clients do this for you and be sure to turn on all lights). Ninth- Goal is to capture contract information so that you can keep the buyers informed of other homes that are available. Tenth-Call and email all who came and thank your client by leaving a card…

The above example of ‘how to do Open House’ is meant to show you the process I go through and is simply one example of strategies I use and the purpose of sharing it with you is so that you can understand the mental process I go through when creating systems.

Every system I employ uses the same type of overlapping strategy and as such is super productive.

I‘m always trying to get the biggest bang for the buck in terms of money and productivity.

If you are going to do something, do it well, it’ll save you time and make you money.

Step # 5

Listen carefully and discern needs I cannot over emphasise  the need to listen. It is more difficult than what you think. The difference between listening and hearing is substantial.  When you UNDERSTAND your clients, you can tend to their needs well. Talk with them, don’t rushbecause in the end if you don’t connect on a deep level your repeat/referral business will NOT grow–people do business repeatedly with those they connect with.

Ultimately to have a sustainable practice you need a strong base that consist of totally satisfied clients who know how to refer business to you and who are willing to do so.  The only way you can sustain such connections is to conect on adeep level first and then maintain that relationship.

Step # 6

Be know as an exceptional person I don’t really strive to be #1. It is more important for me to be known as a trustworthy person who sells Real Estate and participates in the community and in Church. A person who is dependable and available. A person who is easy to contact and who doesn’t shy away from challenges. A person of integrity, period. 

Step # 7

Win the hearts and minds of clients When I meet with a prospect, I’m all in. To me no matter how the prospect came to sit in my office or me in their kitchen, the goal is the same, to win their hearts and minds.

The process begins even prior to our first meeting. All my marketing is structured to produce opportunities like this. Before we meet most of the clients have read my profile online, checked out the marketing that has been applied to the my listings, read ’satisfied client’ endorsements and in many cases has been referred to me.

But when I first got started and I didn’t have ‘reputation‘ to lean on so I leaned on the reputation of my company, my own enthusiasm and market knowledge.

Assuming you are at a listing appointment, prior to the appointment take whatever time is necessary to get to know everything about the neighborhood, i.e. what has sold, what is for sale and what is pending. Also, know who the players are and what separates you from them..For example, I use the following language: Unlike other REALTORS(R) I….

Separate yourself from the pack and know what your differentiators are.

How are you different from them? You might say, unlike other agents who simply stick a sign in your yard, hang a lock box on your door, take a few pictures with their portable camera put them in the MLS and on their personal and Company websites,  I leave no stone unturned when marketing a home.

1. I syndicate your home’s listing to hundreds of websites across the Internet so that anyone, anywhere on the planet, who has an interest in a home like yours can tour it.

2. I make certain that your home’s listing is fully contextualized. That is that is contains multiple high-resolution pictures taken by professional photographers, a virtual tour, and narrated walk-through video and that the details and descriptions are complete and accurate. There is nothing more frustrating to a buyer than incomplete and inaccurate home information. Thegoal is to do everything possible to get your home on the buyer’s SHORT LIST and by getting them to save it to their FAVORITES we accomplish that goal.

3. I quantify the online data because it isn’t enough to know that the home is on the Internet, I want my clients to know how many online visitors it takes to result in a showing and how many showings are needed to result in a sale.  So I provide the analytics to the seller weekly with commentary and the sellers know upfront that if we don’t achieve certain thresholds then the price will need to be adjusted.

4. I automate the feedback. The number one complaint, bar-none, from sellers is that they don’t get feedback from their agents…We nipped this in the bud several years ago and automated the feedback. Automate your feedback…Your clients will love you for it.

Okay, that’s enough to get you started. Hopefully it’ll stir your imagination and you’ll gain a little confidence going into the Spring.

It’s not what you say, it is how you say it

It’s not what you say, it is how you say what you say, that’s important OR is it?

It is mostly some of both and a bit more…

If you’ve been in the biz for anytime at all you’ve no-doubt heard folks say things that make you shutter. I have heard novice and so-called “veteran” agents alike, well-intended as they may be, shoot themselves in the foot in an ‘all out’ effort to protect their clients’ best interest. When, in most cases, the agent had no idea ( because they hadn’t bothered to ask) what the best interest of their client was, mostly because they hadn’t bothered to ask or more often than not, they hadn’t bothered to listen.

I once heard a guy say once that the reason God gave us one mouth and two ears was because He intended for us to listen more than we speak and I’ve found this to be true.

“When I listen, I learn and when I speak, I dispell all doubt that I’ve ever taken the time to listen,” a fellow once said.

I’ve learned over the years that if you learn to ask penetrating open-ended questions you will, more often than not, gain  insight into their ”why” and in no time at all you’ll be able to serve them in exactly the way they need or better yet desire to be served.

By asking penetrating questions and then listening with your whole being you’ll find that clients often share exactly what their needs are and this will assist you in serving them.

Take time to listen, then speak the truth, not just A truth,  honestly.

Doing so will go along way in growing your reputation in a good way.

Listing Videos: Quick and Easy

Want to increase the exposure your listing gets online?  Want to easily incorporate video in your marketing without taking a whole bunch of time to shoot, narrate and edit listing videos?

We’ve found a quick and easy way to generate videos to be exported to YouTube.  Read on to see how you can put your toe in the water of video distribution without learning a new skill set or taking too much time.

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Selling Real Estate: A Look at Home Seller Trends

So, recently, I covered some of NAR’s buyer trends from their 2008 Profile of Home Buyers and Sellers.  This time we’ll dive into the trends of sellers in 2008.

What Sellers Want Most From Real Estate Agents

As you can see, across the board of level of service brought by agents, sellers wanted real estate agents to help competitively price their home.  What’s curious is that sellers that utilized a “fee for listing” agent, most wanted”Help sell[ing] the home within specific timeframe.”  Sellers that utilized a “full-service” or “limited-service” selling agent wanted price assistance more than anything else.  If nothing more, this shows that sellers, on the average, get that price is the issue in selling their home.

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Creative Real Estate Selling

[I wrote this last year after getting the job done for a selling client using a reverse offer]

Is Your Agent Creatively Aggressive in Selling Your Home?

Michigan has been in the throws of a buyer’s market for at least 3, if not nearly 4 years.  Here in the Ann Arbor real estate market, the market is a little more fluid than the rest of Michigan, but as agents, we have had learn to adapt quickly.

Creatively Aggressive is my term for how some agents are representing their clients’ interests in this tough market.  In the examples given, the focus is on protecting the client’s interests and maintaining the fiduciary responsibility between client and agent.

Here’s an example of an agent being creatively aggressive :

The Reverse Offer

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Short Sales…Aren’t

Everyone wants a deal!  We want the best price and quality combination our shrinking dollars can afford us.

The same is true for folks entering the real estate market to purchase.  If you haven’t noticed, many folks when they call for housing information, ask for information regarding foreclosures and these “short sales.”  I’ll tell you right now, that of the folks that I closed that originally told me they wanted a foreclosure or short sale, only 1 in the last year actually purchased a distressed property.

You know the drill, prospect says, “I want to only look at foreclosures and short sales,” thinking that these are the cheapest properties out there, and, therefore, the best value.  As a buyer’s agent, you likely know how the dance is going to go….

1. Send prospect list of homes that meet their criteria, distressed properties and non;
2. Immediate phone call from prospect, “Only want distressed properties!”
3. While showing the prospect homes one beautiful Saturday, they ask why they haven’t gotten 123 Main St sent to them
   1. 123 Main St is a non-distressed property
4. 123 Main St is priced appropriately, in great shape and already under contract

At this point, the prospect does one of two things:

1. Begins to listen to you; or
2. Decides to work with a different agent that “listens to me.”

Ok, so a bit of an over-simplification of the process, but you get the gist.

Need more reason to be wary of short-sales, specifically?  Check out this article from USA Today:

Just 23% of short-sale offers that homeowners receive from potential buyers actually close, according to a February study of 1,300 real estate agents by Campbell Communications. More than 90% of agents cited a slow response from the lender as the reason short sales were lost.

23% is an extremely LOW execution rate!  77% fail…over 3 out of every 4 short sales fail to close. Yikes, those are low odds for closing…

That’s a Grim Picture of Short Sales, but…

There is a silver lining, thin, but it does exist.

If you are the listing agent of a short sale listing, you need to stop trying to negotiate with the banks on behalf of your clients.  Your efforts are best utilized, on behalf of your clients, in marketing the property and negotiating the deals to be presented to the bank.  For your sanity, and the sanity of your clients, you should enlist the help of a short sale specialist or a real estate attorney.

Listing Syndication Systems

One of the challenges that we all face as Realtors® is learning how to manage seller expectations.

Having the hard conversations and doing what is right is merely the beginning.

We all need to strive to learn what REALLY works, when it comes to marketing our sellers’ properties.

How do you satisfy your sellers’ expectations while not throwing away your hard-earned dollars on ineffective advertising?

Typically, sellers like to see their homes advertised everywhere. And, if your town is like ours, you have at least one agent putting on a show in newspapers and homes magazines – in essence, selling false hope to land more listings.

The fact is: newsprint advertising doesn’t ‘SELL’ homes – it’s simply another form of ‘personal promotion’ and in that sense, it’s the industry’s ‘dirty little secret.’

So why do agents feel compelled to play that game when there are much better ways to sell homes that both preserve personal and professional integrity?

Why play that game when your sellers expect you to be the Real Estate Rock Star they hired and the one you yearn to be?

In a listing appointment, when asked, “Where are you going to promote our home?” some agents say, “Everywhere.” And, in a futile attempt to live up to that impossible expectation, they waste money on print advertising.

So that’s what needs to be dealt with: the need to please versus figuring out how to seriously market listings…which is the more ethical thing to do.
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The New Real Estate

The last few years have seen a massive shift in how real estate is done. The basics of real estate sales still work and work well. In addition to knowing how to get deals closed, today’s real estate market requires you to know a lot more about how information moves.The two areas where the real estate industry has seen a gigantic shift is in: 1 – the crumbling of house values;
2 – the heavy emphasis on systems and technology to close transactions.

Where Have all the Values Gone?

[apologies to Paula Cole and her song Where Have All the Cowboys Gone?]

Seemingly, the halcyon days of real estate are behind us when you could list a home, throw a dart to choose the price and the home would sell in a week. Sellers were ecstatic, agents elated and buyers were just happy they purchased before things got too expensive.

Then the house of cards collapsed…

Now, agents have to justify to sellers why their home is worth 20-50% less than when they purchased. Buyers are having a field day applying the boot to sellers that NEED to sell.

Agents, meanwhile, have adapted as they know best. Some, who saw the declining values as never-ending and too much work, bolted the industry. Other agents, comfortable with their communication skills and an eye for the long term, saw the drop as their time to shine. These agents KNOW in their hearts that by serving their clients well, during the period of a down market, they will reap the rewards when the market turns…

Transparency…there’s that word again

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First-Time Home Buyers: Got any?

When Uncle Sam says, “Hey, first-time home buyers, I’ll reduce the cost of your first home by $8,000,” folks respond!

The NAR released its March Existing-Home Sales report this recently, and it paints a story that’s kinda grim, but still has some silver linings.

An NAR practitioner survey in March showed first-time buyers accounted for 53 percent of transactions, based largely on contracts offered before the $8,000 first-time home buyer tax credit became available. “Buyer traffic has been rising, and real estate offices are getting phone inquires about the tax credit,” Yun said. “By early summer we should be seeing a positive impact on home sales from record-low mortgage interest rates in addition to the stimulus provisions.” [emphasis added]

So, even before the $8,000 sweetener, first-time home buyers were seeing value in jumping into the market.  With interest rates steady to falling, and inventory levels remaining relatively high, this is great news as the summer buying season gears up!

The problem facing many Realtors® is how to find those first time home buyers.  Simple deduction, and NAR reporting, tells us that an overwhelming majority of folks utilize the internet, at some point, to find information about their next, or first home, purchase.

After the Jump, 4 Facts You Need to Know About Today’s Buyers

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