Real Estate Field Notes

To Be or Not to Be a Real Estate Agent

I was at an open house on Sunday up the hill from here.  I have my neighbor's home listed and it was a beautiful afternoon to showcase their lovely home. 

We are in rural Tumwater-Olympia and our address is actually Tenino.  That surprises people, but it is true.  Tenino isn't the most popular place as it is small and people think not a lot goes on there.  It is a cute little berg though.

I had 3 couples come through the house soon after I arrived.  Two couples with children who really liked the house and property and a couple who are soon to be empty nesters.  The wife asked me about Jim Greene as she had known of him in their early days of home shopping.  In our conversation it became clear that she is interested in getting her real estate license.  I told her I would be happy to visit with her about what it takes and what it is like to be an "agent".  I had never considered the job a possiblity for myself until my husband encouraged me to study for the test and give the job a try!

I started my research by answering an ad in the newspaper for a company who was training new agents.  I went in for an interview with the trainer and I was encouraged because of my background in education to take the class in preparation for the licensing exam.  I bought my training CD from the nice lady and off I went to STUDY.  One Licensing School

Did I ever study!  My husband helped me with the math and slugged through class after class doing the practice tests again and again.  I passed the course, took the test and passed the test on the first try.  Then the real life experience and the real life job of being a real estate agent began.  And it is nothing like the test; the real job I mean.  The test is a means to  an end.  I was hired by the company that I interviewed with initially and got some of the best one on one training available I believe.  I had a person with me every step of the way as I learned how to write up a purchase & sale contract, hold an open house and finally list a house.  It was scary to say the least.  But I made it and I love it most days.

Being a real estate agent is crazy making as I wear so many hats.  I am a counselor, a listener, a person able to find resources for numerous things, I fill out legal contracts, I pay attention to details & dates, and I negotiate with other agents constantly to make transactions happen.  And through all of this I have developed "thick skin."  I have become involved in educating home buyers about what an agency relationship actually is because so many clients "jump ship" and do not value the time and effort and agent puts in to their search for a home.  Only one person gets paid for a buyer's home purchase.  I would like to think it is the person who did all the legwork finding the right home.  But many times it turns out to be a listing agent my client calls to see their listing without me.  That hurts, but you do learn to take it professionally.  It still hurts, but it hurts less as time goes by.

To be a real estate agent you need a certain skill set along with some financial support. 

A list of skills I feel are essential:

• Great communicator
• Great listener
• Great negotiator
• Detail oriented
• Patient
• Willing to learn new things
• Understands & uses technology
• Flexible with time
• Team player
• Doesn't burn bridges with clients or other agents
• Excellent with record keeping and follow through

Talk to another agent if you are thinking of getting into the business.  Do a "job shadow" with an agent and learn about the financial details of being a licensed agent. 

State of Washington Licensing Information

More Protection for Mortgage Borrowers

More protections for mortgage borrowers at closing time

By Kenneth R. Harney

Syndicated Columnist

WASHINGTON — If you're applying for a loan to purchase a primary or secondary home, or planning to refinance, you should be aware of a little-publicized set of federal consumer-protection rules that take effect July 30.

Among other key changes, the new Federal Reserve guidelines require lenders to provide you initial disclosures of your mortgage costs within three business days of your loan application. If you don't get them, you can pull the plug.

The rule also prohibits lenders from collecting any fees, except a reasonable charge for checking your credit, until you've been given the loan-cost disclosures.

This means no more out-of-pocket upfront application charges until you've received the truth-in-lending disclosures and an annual percentage rate (APR) calculation of those loan costs.

Since many mortgage brokers and lenders traditionally have collected fees covering appraisal, credit and various other charges at the time of application — sometimes amounting to hundreds of dollars — this will be a significant change in procedure for the lending industry.

The rule also prohibits quickie closings on loans by requiring a seven-day waiting period after applicants are handed their early disclosures or the disclosures are mailed. You'll now have up to a week to think about the transaction and decide whether it's right for you.

Final truth-in-lending disclosures are due three business days before closing.

Here's an even more sweeping change for applications on or after July 30: The new rules require lenders to deliver a copy of the real-estate appraisal to you three business days before the scheduled closing on the loan.

In the past, even though federal regulations guaranteed that consumers could request and obtain a copy of the appraisal, lenders and homebuyers frequently ignored that right.

In fact, many consumers had no knowledge of this right because no one in the home-purchase, financing or settlement process told them about it.

Now, the timing of the loan closing itself — the financial ballgame for loan officers, real-estate agents, title and escrow officials — will depend upon your receipt of the appraisal in advance. The exception will be that the three-day rule can be waived if you don't think receiving the appraisal is necessary.

Another significant change: If the APR on the early truth-in-lending disclosure increases by more than one-eighth of a percentage point (0.125), the lender will now be required to "redisclose" — provide you a corrected version and allow you an additional seven business days to consider the transaction before settlement.

What might cause the APR to increase after the initial, early disclosure? Lots of things: Say you left your initial rate on the loan to float with the market, but rates increase. You'll need to get an amended truth-in-lending disclosure.

Or say the lender got inaccurate estimates of costs from third-party participants in the transaction, such as the settlement or escrow company. Or say that unexpected, 11th-hour junk fees materialize.

All these events — frequent sources of consumer complaints — could force the lender to redisclose loan costs and set back timing for the settlement.

What are some of the likely repercussions of the Fed's new mandates? First, the traditional approach of aiming in advance for a date-certain settlement target for home-loan transactions almost certainly will be affected.

Actual closing dates will be more closely tied to lenders' and settlement agents' accurate estimates and their ability to deliver disclosures and appraisals by the required dates.

For example, if appraisers are backlogged and can't produce valuation reports quickly enough, settlements will have to be postponed.

Second, the purposes of the rules are to afford consumers better access to, and more time to consider, key elements of what are major financial transactions.

There might be fewer instances of last-minute closing-date surprises on fees, where buyers are slammed with hundreds of dollars of charges they'd never expected. But nobody can say that for sure.

Finally, the rules may well trigger new waves of litigation if lenders and their business partners are not scrupulous in their compliance. There is an active and aggressive segment of the legal profession that specializes in going after banks and mortgage companies for truth-in-lending violations.

Don't be surprised if you hear of lawsuits seeking cancellation of mortgage deals because timing deadlines were not met, appraisals not received.

As David Berenbaum, executive vice president of the National Community Reinvestment Coalition, put it in an e-mail comment: "Consumer advocates will closely monitor" compliance with the new Fed regulations, and the lending industry can expect "civil litigation against bad actors."

Kenneth R. Harney: kenharney@earthlink.net

Copyright © 2009 The Seattle Times Company

The BEST Buyers

Did you know that real estate agents have distinct feelings about buyers?  I mean we work with everyone, but there are some buyers you get in the car and things just click.  This happened for me this past weekend when I took Peter and Ana out for a fun Saturday tour of homes.  We had done our homework prior to Saturday.  They have been receiving listings from me and choosing those that were of interest to drive by.  This is a great way for buyers to get a feel for neighborhoods.  The pictures on-line can look great.  But the drive-by tells the true story.  There might be several beat up cars in the neighbor's driveway.  The house across the street could be hot pink. 

Peter and Ana want a private backyard.  That is very important so the drive-by is really important.  Our search started with a late 60's house that the best adjective to describe it is: BLUE.  The exterior is blue, the carpet is blue, the kitchen and bedrooms were blue and yellow as were the family room and bedrooms.  It was cute.  It was too much along with the dated wrought iron railings around the sunken living room.  We marked it off the list.

Next we went to a brand new 8 house subdivision in Lacey.   The location is great for them because of job location.  The house was sheet-rocked and we went up a narrow board to get in.  On the way out we discovered the back door was much easier: stepped right out.  The dining area and living room in this house seemed a bit small, but all in all there is potential for them.  We are talking with the listing agent about another lot in the same area that is more secluded. 

The next house was what we call "the marble house".  It is interesting how we name houses by the most striking feature.  This home had marble kind of mismatched floor tiles on the entire first floor.  My comment is: "interesting."  The house is in bankruptcy, or the owner is I should say.  The floor plan was good and the house was in a setting that they really love.  The siding was in poor condition however and the roof too.  Maintenance was not on the top of this sellers' list!  The hot tub with no cover sat in the back looking very naked and alone.  With all that, it is still on the list.

Our next stop took us to two "milk toast" homes near each other.  I say milk toast because there was no outstanding features to wrap your words around.  No color in the first, new carpet all beige kitchen counters were beige.  Yep, it should be the beige house. 

We are still looking and the clients are revisiting the lender to narrow down loan programs that they qualify for.  They are so excited and they are doing the research to make this a well thought out purchase that they can enjoy for years to come!  I applaud them.  They are serious, they are flexible, they have a sense of humor and they are loyal. 

Declaration of Financial Independence

Last week, while browsing through a USA TODAY newspaper, I came across a full-page advertisement from ING Direct that seemed to be a reaction to the financial crisis.  The page was simply a list of ten rules to live by if one is to be financially independent.  The rules were arranged like an oath and there was even a place for each member of a family to sign.  Here are the ten guidelines: 

1. We will spend less than we earn. Saving a little out of every dollar we bring home is the foundation of independence. Without it, we can’t build equity in our home, we can’t invest for the future, and we can’t be ready for challenging times. We promise to pay ourselves first, always.
2. We will use our home as a savings account. Besides shelter and comfort for our family, the role of a house in our financial life is to build equity. We will have a healthy down payment when we buy. We’ll choose the mortgage that lets us pay down the principal fastest. And then we’ll leave that equity safe where it is instead of spending it on things that don’t last.
3. We will take care of our money. It’s not enough to have money in a bank. We will put it where it will grow. We’ll keep track of it. And we’ll check every account we have every year to protect ourselves against fraud or escheatment.
4. We will defend our credit worthiness. Good credit is going to be precious in the years to come. We will pay our bills on time. We’ll borrow only when we need to and in amounts we can comfortably pay back. And then we’ll do just that.
5. We will ignore unsolicited credit card marketing. We decide when we need a credit card, not some marketer. And mostly, we probably don’t need another one at all. We won’t even open those solicitations. We’ll shred them.
6. We will know the cost of borrowing. The interest lenders charge us is real money, too. When we buy a mortgage or finance a purchase, we’ll figure out what that interest is really going to cost in dollars, add it to the purchase price, and ask ourselves if it’s still worth it.
7. We will invest for the long term. Futures are built out of patience and prudence, not luck. We will not put off being a saver because we think there’s a lottery win in our future, in Vegas or on Wall Street.
8. We will take care of the things we have. We work hard for our money, and it’s disrespectful to waste it – or the planet – by treating our possessions as disposable.
9. We will remember what matters. We are not the things we own. If we have to spend and spend on bigger, more impressive things to keep up with our friends, then they are not our friends at all.
10. We will be heard. Our representatives in government and the corporations we deal with need to know that we are paying attention. If we’re silent, we’re accepting the status quo, and the business practices that got our country into this situation will continue. We are not going to accept that.

ING Direct's Declaration of Financial Independence

I didn’t learn anything new by reading the guidelines, but it was a valuable review of financial advice I’ve gotten (and subsequently forgotten).  And the tips are about everything from consumer habits to investments.  It was neat to see the different principles tied all together into a vision of a financially wise lifestyle.  Plus, the guidelines were simple and entertaining to read.

 

The link above will direct you to ING Direct’s “We the Savers” webpage where you can email or print a PDF version of the declaration of financial independence.   Also on the webpage is a message from Arkadi Kuhlmann, ING Direct’s CEO of Saving.  I hope you find this advertisement as valuable as I did. 

--Megan Field, Field Notes Guest Author--