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Can you afford to lose $800 or more when trying to buy a home?

These are true experiences through my eyes as a listing agent.   I put one of my listings under contract twice and both times the buyer had to cancel due to not being able to get financing.  Both buyer’s had their own buyer’s agent.  Both buyer’s agents never worked or recommended the lenders the buyer’s chose.  Both buyer’s agents did not enter into the process of getting the buyer qualified for a loan nor did they speak with their lender when the offer came in.  Both buyers provided pre – approveal letters with their offers.

I always call the buyer’s lender on behalf of my seller to find out how the lender qualified the buyer.  Did the buyer actually provide documentation to the lender or did they just fill out an application and a credit report was ran.  In both cases both lenders verified they had looked over the documents the buyer provided and were confident they could get a loan.

What happened?  The first buyer we had was put in the wrong loan program by the lender.  How did it happen that the lender put the buyer in the wrong loan program?  The lender assumed the buyer had a job in the area instead of looking at the application.  The buyer spent money on inspections and an appraisal only to find out they did not qualify for that loan program.  I tried to talk with the buyer’s agent to put the buyer in the correct loan program through one of my lenders, but the buyer got cold feet after the experience.

Our second buyer who was again pre – qualified found out they could not get financing after they spent money on inspections and an appraisal.  What happened? The loan officer did not know the loan policy when it came to dept the buyer owed and did not calculated the dept to income ratios correctly.  Had the loan officer done this correctly from the get go the buyer would of never qualified for a loan from day one.   I reached out to the buyer’s agent to have one of my credible lenders look at the buyer finances and that is when I found out the problem.

 

In both instances the buyer’s agents sent over the cancelation agreement without consulting with me to see if they could re-negotiate the deal or save the deal using another lender.   After I got the cancelations I tried to save the deal.  The buyer’s agent should of tried to save the deal for their buyer instead of just sending the cancelation over.  The buyers both spent a lot of money.

You here all the time every Realtor is a like and it doesn’t matter who you get to list or buy a home from.   It’s just not true.

I can guarantee you neither one of these buyers had a buyer’s agency agreement along with the services that buyer’s agent would provide them.  Both buyer’s lost a lot of money and on the listing end it wasted a lot of people’s time, cost my seller undue stress and money, cost me my commission twice and the title companies pay check twice.

As a listing agent I am limited on what I can find out from a lender how qualified the buyer is.   The lender is the one who should know loan policy, and what loan program the buyer can fit into based on their credit report and documentation.  If the lender tells me they reviewed the documentation and the buyer is qualified, I have to believe them.   The best defense for the buyer is the buyer’s agent they hire from the get go.

My best advice to buyers or sellers is make sure whoever you pick to buy or sell a home through that the services the real estate agent will provide are in writing and you read what those services are.  When it comes to financing make sure your buyer’s agent works with credible lenders and go with a credible lender your real estate agent recommends and make sure your agent is involved with the lender from day one of you looking at homes.

According to the National Association of Realtors 1 out of 3 closings fails due to the buyer not being able to get financed. 

 

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What is a municipal lien search

A municipal lien search looks at potential liens that are not recorded in the counties public records and includes any open permits.

The municipal lien search looks at:

Utilities bills owed

Code violations

Permitting issues that may exist

Special assessments that could be due

Property taxes due

 

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Conditional vs. unconditional termination of a Florida Real Estate Listing Agreement

Real Estate Agent

Home sellers are not aware there are two ways of canceling a real estate listing agreement with their current listing agent.
I want to be clear that a Florida real estate brokerage using the Florida real estate listing agreements has no obligation to
do either.

Many agents will tell sellers they can cancel anytime during the listing presentation. First make sure it’s in writing separate from the listing agreement and second confirm if the cancelation will be conditional or unconditional.

Conditional vs. unconditional termination: What’s the difference?

By Joel Maxson
 

June 5, 2017 – Part 1 of this 3-part series explained that the Florida Realtors residential listing agreement requires the seller to get the broker’s consent to terminate; otherwise, the seller could be exposed to a claim for damages for possible breach of contract.

Today’s post (part 2) summarizes conditional and unconditional termination. Part 3 will cover the legal and ethical risks when a seller wants to discuss terminating another company’s listing agreement.

Based on numerous conversations with members who call into the Legal Hotline, brokers honor a seller’s request to terminate a listing agreement more often than not. When this happens and a broker uses the form Modification to Listing Agreement (MLA-5x), the broker is faced with two similar-sounding termination clauses that have very different meanings.

Conditional Termination
This termination fits a seller who no longer wants to sell the property. If this turns out not to be the case, full commission would be due if the seller transfers (signs a deed), contracts to transfer (signs a purchase and sale agreement), or contracts to lease the property or any interest in the property “from the date of the conditional termination through the actual Termination Date and Protection Period, if any.”

Unconditional Termination
This termination fits a seller who wants the option to continue marketing the property, with or without the help of another broker, after the termination. Under unconditional termination, both sides agree to powerful release language, as they release each other from “all obligations under the Agreement and … any and all actions arising from or related to the Agreement.”

Joel Maxson is Director of Member Legal Services

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Broker advises Seller and Buyer to verify all facts

Verify Property Information

Broker advises Seller and Buyer to verify all facts

Professional Advice; Broker Liability: Broker advises Seller and Buyer to verify all facts and representations that are important to them and to consult an appropriate professional for legal advice (for example, interpreting contracts, determining the effect of laws on the Property and transaction, status of title, foreign investor reporting requirements, the effect of property lying partially or totally seaward of the coastal construction control line, etc.) and for tax, property condition, environmental, and other specialized advice. Buyer acknowledges that Broker does not reside in the Property and that all representations (oral, written, or otherwise) by Broker are based on Seller representations or public records. Buyer agrees to rely solely on Seller, professional inspectors, and governmental agencies for verification of the Property condition, square footage, and facts that materially affect Property value.

 

The above paragraph is in all Florida Realtor purchase contracts and really addresses both the seller and the buyer.  It’s in the best interest of the seller to verify what is being published about their home when listed for sale.  The seller does not want their home misrepresented to the public and typing errors can occur when placed in multiple listing service.  

It’s in the best interest of the buyer to hire the appropriate professionals to verify the following on the property:

A survey can provide the properties legal description, boundary lines, easements, zoning, flood zones, utility lines, buildings, fences, ingress & egress, and encroachments. 

A home inspection can provide you the condition of the home, appliances, and mechanics.  However, a home inspection does not look inside HVAC units nor can it tell you if you have water leaks under the slab.There are separate tests for radon gas, mold, and lead paint in addition to a regular home inspection.

Test the water when there is a well on the property.   Have a professional septic company look at the septic system

An appraisal will provide the buyer an opinion of value and the gross living sq. ft. of the home.  

Use a environmental consultant if buying a large property or commercial property as there may be a hazard waste liability on the property

Protect your investment with A Title search and title insurance policy will discover recorded liens on the property, who has the right to sell the property, history of ownership, tax search, unsatisfied judgements against the property, 

Homeowner Associations –  ask questions directly to the homeowner’s association especially when it comes to pets, commercial vehicles and sheds or better yet get a copy of the current homeowner association covenants, conditions, restrictions manual and the bylaws manual. 

The bylaws govern how the HOA operates and contain the information needed to run the HOA as a business.

The CC&R are the rules of the neighborhood.

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Florida Room Square Footage Is It Considered Living Sq. Ft.

Living Sq. Ft. Florida

Make sure when your looking at homes you know the true gross living sq. ft.  of the home .   You may think your buying a 1800 living sq. ft. home as advertised, but in reality your buying a 1600 sq. ft. living sq. ft. home.  Living sq. ft. as defined for the main home in Florida is all space under roof and central heat and air.  This does not apply to space where the floor drops from the main floor of the home as in a garage or lanai.

Florida rooms are  a prime example of space that gets added into the total living sq. ft. on home listings.

In order for an appraiser to add living sq. ft. for a Lanai that has been turned into a Florida Room the Florida room must meet the following criteria.

Must have glass windows

Must have central heat and air not a add-on uint

The floor must be at the same level as the house

No patio doors from main house to Sun Room

All permits must be pulled and is it recognized by county assessor as gross living sq. ft. 

If any of the above criteria are not met an appraiser cannot count the sq. ft. in the room as part of the gross living sq. ft. 

True living sq. ft. affects the value of the home and comparing other homes of like kind in making a buying decision.

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Adverse Possession In Florida

Adverse Possession

Adverse Possession In Florida

Squatters, trespassers, and encroachers may, over time, gain ownership rights to Florida property.

There is no single statute in Florida that spells out the elements that a trespasser must establish to prove adverse possession.

Read More Here

By

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Factors That Affect The Asking Price Of A Home

Factors That Affect Your Asking Price How quickly you need to sell Repairs needed and updating The amount of competition in your price category, location, and living sq. ft. The availability, flexibility and affordability of financing The sale prices of similar homes sold in your area during the past six months to one year What months of the year bring more buyers to your area The number of buyers looking in your home's price range The number of bedrooms Lot View Factors That Should Not Affect Your Asking Price The original cost of the property; price is determined by today's market The total cost you've invested to make improvements The cost to build your home today Emotional attachment The opinions of friends and neighbors

Factors That Affect Your Asking Price

  • How quickly you need to sell
  • Repairs needed and updating
  • The amount of competition in your price category, location, and living sq. ft.
  • The availability, flexibility and affordability of financing
  • The sale prices of similar homes sold in your area during the past six months 
  • What months of the year bring more buyers to your area
  • The number of buyers looking in your home’s price range
  • The number of bedrooms
  • Location, location, location
  • Lot View

Factors That Affect Your Asking Price How quickly you need to sell Repairs needed and updating The amount of competition in your price category, location, and living sq. ft. The availability, flexibility and affordability of financing The sale prices of similar homes sold in your area during the past six months to one year What months of the year bring more buyers to your area The number of buyers looking in your home's price range The number of bedrooms Lot View Factors That Should Not Affect Your Asking Price The original cost of the property; price is determined by today's market The total cost you've invested to make improvements The cost to build your home today Emotional attachment The opinions of friends and neighbors

Factors That Should Not Affect Your Asking Price

  • The original cost of the property; price is determined by today’s market
  • The total cost you’ve invested to make improvements
  • The cost to build your home today
  • Emotional attachment
  • The opinions of friends and neighbors

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Pulling Owner/Builder Permits Is Risky Business

Building Permits Marion County Florida

You’re ready to start your home remodeling  project and start interviewing contractors.  The contractor you chose insisted on you pulling the permit for the job.  You thought no big deal I can do that.

Pulling Owner Building Permits Marion County FL

If you do not intend to do the work yourself and have been asked by someone without a contractor’s license to pull the permit, you are at risk of financial harm both by penalty and injury.  Chapter 489.103 (7), Florida Statutes:  Owners of property must supervise the work being performed.  Any person working on your building who is not licensed must be employed by you, which means that you must deduct F.I.C.A and withholding tax and provide workers’ compensation for that employee.

Without workers’ compensation insurance, you could be held liable for injuries received on your property.  Typically, your homeowner’s insurance policy will not honor your claim if the work being performed required a licensed contractor.  You could end up responsible for thousands of dollars of medical bills. 

Not only is it dangerous, but it’s also a crime in Florida. 

Chapter 455.227, Florida Statutes:  Any person who knowingly aides, assists, procures, employs or advises an unlicensed individual can be charged with a first degree misdemeanor and may face fines of up to $5000 for each offense.  

Contractors can be licensed by the State of Florida or can be licensed by the county they work in and not have a state license.   If your contractor is doing work that a license is not required make sure they carry liability insurance and worker’s compensation insurance.

There is no such thing as a Handyman License in Marion County Florida.

Contractor Licensing Requirements For Marion County Florida

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Florida Auto Insurance What You Should Know

Florida Auto Insurance

Auto insurance varies from state to state and when you move here to Florida it’s a good idea to educate yourself on our state’s auto insurance policy options.   Florida auto insurance has one piece to it that is consider the no-fault piece of the policy.  Personal Injury Protection on your auto policy is the no fault part of Florida auto insurance.  Personal Injury Protection kicks in right away without you having to go to court to determine who is at fault.  Other coverage’s on your Florida auto insurance are not no fault.  One exception to Personal Injury Protection is when you rent a car out of the state of Florida.  Personal Injury protection does not cover you in an out of state rental car.  Many people do not know this.  If you are driving your own car out of the state of Florida than you are covered under the Personal Injury Protection.   For more details on Florida Auto Insurance coverage go Here:

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Do you really need a Buyer’s agent to help you buy a new house?

Q:  What can a buyer’s agent realtor do if you are buying newly constructed home in a brand new neighborhood. I’m interested in new homes built by Pulte.   It seems easy to do on your own. I have done this before, and I negotiated myself with the selling agent working for the developer.

 

It’s the agents expertise in several areas of the real estate business that brings value to the buyer. It’s not just about the price a buyer pays for a home it’s the whole package that comes with buying real estate.

I personally sell homes in Pulte neighborhoods so hence my opinion.

Depending on location new homes today are like buying new cars. They depreciate the minute you move into them. How do you know this? Look at the history of the resale market in the neighborhood with your buyer’s agent.

Several people have bought new Pulte homes that could of saved a bundle and had a better home if they bought a resale only 8 years old in the same Pulte neighborhood. It amazes me that buyers don’t even know re sales are available in the same Pulte neighborhood because they can’t get passed the new sales office. It amazes me that buyers don’t know there are two Pulte developments in my area.

A builder such as Pulte keeps their prices the same with or without a real estate agent because they know people talk about what they paid and Pulte needs their homes to appraise for the value they want to sell them at. Keeping prices the same stabilizes their base price and allows them to increase their base price. Pulte also knows the value of Realtors and wants to keep them happy.

It’s what you don’t know that always comes to bite you in the butt.

The most important thing about buying a new home in planned development is the lot and your buyer’s agent is the one to help you pick it. There is more to picking a lot than just the view.

Your buyer’s agent is going to make you think about things you never thought of so you can make a better buying decision.

Is the builder’s lender the best deal verses another lender?

What are the best upgrades to put in the home to get the most value out of the home when you go to resale?

When building a home would a typical buyer know what the most important construction phases are especially if building in a different state? Most people think the county inspectors are all they need to check on the construction. Think again!

Biggest mistake a buyer makes when building a new home is they think everything is going to work perfect. Not! What about the nail that went through the water pipe or pipes? Missed wiring anyone?

What do buyer’s know about venting a new home? Builder cutting corners or are they doing it right?

I always feel that people who know the value of an educated person helping them and understand that hard working people should get paid for their knowledge, advice, and time are the ones that appreciate a buyer’s agent.

 

Dawn Rupersburg Realtor Ocala FL