why deals fall apart adorna o. carroll abr/m, srs, crb, gri, sfr, sres, pmn, epro...
TRANSCRIPT
• Didn’t do their job correctly• Didn’t do their job completely• Didn’t know/disclose some pertinent facts• Didn’t understand what options were available• Didn’t understand the process to get the job done• Didn’t follow someone else’s professional advice• Let something fall through the cracks• Let their ego get in the way of good judgment• Couldn’t work well with the other professionals
Deals Fall Apart Because Someone
The Usual Suspects
• Seller • Listing Agent• Buyer • Buyer’s Agent• Home Inspector • Loan Originator• Appraiser• Underwriter• Attorney
• Financial situation not fully disclosed
• Condition of property is misrepresented
• Doesn’t understand the process
• Doesn’t agree with market value/price
• Ignores professional advice
• Hires professionals that don’t have the necessary level of skills
Seller
1. Home on market prematurely2. Over-improving for area 3. Pricing based on Seller net4. Being emotionally involved5. Not disclosing problems6. Not knowing current issues or
market conditions7. Hiring agent based on non--
business factors
7 Costly Mistakes when Selling M. Anthony Carr
• Improper Pricing of Property• Lack of due diligence• Did not explain the process• Does not have the proper skills• Is inflexible or lacks creative solutions• Has difficulty working with other professionals• Does not have a good team of peripheral
professionals• Lets details slip through the cracks• Hasn’t prepared client that coop fees, inclusions
and desired terms are merely a suggestion
Listing Agent
Off-Site Considerations & Other Time Bombs!
• Noise–Air Traffic; Rifle Range;
Highway, railroad, etc• Property Stigmas– Psych Impacts, Sexual Predators
• Assorted Issues–Prison, Dump, Land Fill, Cell
Tower, High Tension Wires, Abandoned Property, Meth Labs, Crack House
Solutions for the Listing Side• Invest time in a Seller Counseling Session detailing
what you can/can’t do by your license law and COE; will/won’t do by office policy and about the process
• Research the real financial viability prior to listing • Disclose potential for short sales and fee issues• Disclose material defects/red flags• Price the property correctly• Remain flexible and open• Discuss current market conditions• Invest in advanced skill training
Buyer
• Isn’t finally pre-approved prior to shopping• Has manipulative family with purse strings• Over-reacts during home inspection • Underestimates costs of repairs • Doesn’t understand the process• Doesn’t heed professional advice • Selects peripheral professionals that don’t have the
proper skills – lender, inspector, attorney
Buyer’s Agent• Improper Pricing• Lack of due diligence• Didn’t explain the process• Doesn’t have the proper skills• Is difficult to work with • Doesn’t have a good team of
peripheral professionals• Lets details slip through cracks• Doesn’t know how to get paid
Solutions for the Buying Side• Invest time in a Buyer Counseling Session detailing
what you can/can’t do by your license law and COE; will/won’t do by office policy and about the process
• Get loan approval for the buyer prior to showing• Secure authorization from your client so the LO can
speak candidly with you• Disclose potential for short sales and fee issues to
buyer so they are prepared for issues that can arise• Help client realize that inspections are necessary• Prepare a CMA • Remain flexible and open• Invest in advanced skill training
Home Inspector• Did not explain the process or
difference between maintenance items versus defective issues
• Behaves like the appraiser or is a drama queen
• Does not have the proper skills• Is difficult to work with • Lets details slip through the
cracks
• The inspection phase can be a renegotiation• The home inspector is NOT the specialist only the
person to identify issues that require study• Help buyers realize that not everything is an issue • Help seller realize that all requests should
researched and considered • Explain the true meaning of “As Is” • Never talk any client out of having inspections• Secure paid receipts from contractors for all repairs
Solutions for the Inspection Phase
• Only does ‘vanilla’ loans• Can’t get creative solutions• Didn’t explain the process• Blames the agent for issues• Lacks knowledgeable team
Loan Originator
• Is difficult to work with • Doesn’t understand role of
buyer agents• Allows details to slip
through the cracks• Suggests bank fraud
• Isn’t from the area and doesn’t know the dynamics of market or neighborhoods
• Does not have the proper skills• Doesn’t have an accurate
database for comps• Only sold comps are
foreclosure sales• Is difficult to work with • Lets details slip through cracks
Appraiser
• Believes they can second guess the appraiser• Can get careless when overburdened with files• Doesn’t necessarily feel compelled to meet
contractual dates or time pressures
Underwriter
Solutions for the Lending Phase• Help clients realize that everyone needs
to function like a team • Success in contingent on the skills of
the professionals involved• Prepare clients what options exist if a
property doesn’t appraise and why extensions may be required
• Be prepared to do the other agent’s job to get the job done
• Invest in achieving extensive knowledge of the loan, appraisal and underwriting process
•
Attorney• Isn’t a real estate attorney• Paralegal is a problem• Doesn’t do win/win negotiating • Can’t collaborate on creative
solutions or problem solving• Did not explain the process• Is difficult to work with• Doesn’t acknowledge your
professional role • Does not have a good team of
peripheral professionals• cracks
• Cultivate relationships with the lawyers and their paralegals in your market area
• Insure that all terms and performance dates are in force
• Partner with the lawyer in advocating for terms your client can accept
Solutions when working with the Attorney
Moral of the Story• Really know how to do your job
and the job of everyone participating in the transaction
• Anticipate what can go wrong and prepare your clients in advance
• Look for creative solutions and involve all parties in solution based problem solving
• Stay Calm• Learn to negotiate well