Georgetown, Texas Real Estate Blog Your Host: Edward Lui

Editor’s Note: Two weeks ago, Maria revealed some great thoughts on why it’s so critical to have a clean home when selling (Clean homes sell faster).  I just showed a client a home in Fountainwood Estates in Georgetown, Texas yesterday and the home was a mess!  The tragic thing is that it was listed and owned by a real estate agent too!  Well, here you’ll get some practical tips on getting the job done.  Read on…

1. If you find that you can do the job yourself, then great! Here are some guidelines for you:

• If you have clutter, get rid of it! The more “linear” you can make a home look, the cleaner it will appear.
• Make a list of easy to forget items in your house to clean. Make sure to include the following: Ceiling fans, ceiling corners, light switch plates, electrical sockets, baseboards, inside windows, window frames, window sills, blinds, all dusting/polishing, glass cleaning, bathrooms, kitchen, and floors.
• If you are going to be leaving the oven or refrigerator behind, then the inside of these appliances should be cleaned regularly as well. It is best to do a top to bottom clean then upkeep these things by rotating them on a weekly basis.
• If you are dealing with mold issues in tubs and showers, spray a mold remover every day to get rid of the discoloration. If that doesn’t work, replacing the grouting is the best way to go.
• If you have the time, vacuum every day before you leave work. It is amazing how a freshly vacuumed carpet can dramatically improve the appearance of your home!
• Depending on the condition of your home, you may need to hire a professional, especially if you are looking at years of buildup/neglect.

2.  If you decide to hire a professional, follow these guidelines to ensure you hire the right company:

• Be sure the company is licensed, insured, and bonded. Now is not the time for any cleaning service hassles due to the many number of things that can go wrong in a cleaning! While on the subject, don’t automatically go shopping for the company offering the lowest price. In general, as with all things, you get what you pay for.
• Try to get a referral from a friend, relative, or coworker. This is the best way to ensure that you find a company that will do the job right the first time around.

So, whether you can do the cleaning yourself or go with an outside company, remember to keep it clean during the selling process! Having a clean house to show should not be an afterthought but a priority as it may help you to sell it faster. Remember, your prospective buyers will picture themselves living in the house and it’s a lot harder to picture yourself living in a dirty home!

Welcome Home Cleaning Services specializes in both “Spring Cleans” and Move In/Move Out Type Cleanings. If you do find that hiring a professional will work best for you, please give us a call at 512-931-2095 and I’d be glad to be of help!

Maria Dorian

Welcome Home Cleaning in Georgetown, Texas

Clean Homes Sell Faster!

Are you about to put your house on the market? I’ll tell you a little insider secret for selling it faster: Keep it clean!

I know, I know, you may be thinking; “That’s not an insider secret, that’s just plain common sense!” However, I’m always amazed at how many people don’t take the time to keep their house clean while they are trying to sell it. Then they wonder why their house won’t sell as fast as others in their area!

I remember one homeowner in Round Rock, Texas whose Realtor insisted that she hire a professional to clean her house. The homeowner did not like the idea of having to spend the money to hire a professional but her house had been on the market for close to a year and her Realtor thought that a thorough cleaning would help speed things along. Smart Realtor! My company was hired for the cleaning and, believe it or not, less than two weeks later the house was sold! I know this because the homeowner also hired my company for the move out cleaning.

The bottom line is that you want your house to be totally clean and presentable for prospective buyers. The alternative is to sit on your property without a sale for longer than necessary.

On my next post, I’ll give you some practical tips for getting the job done!

Welcome Home Cleaning Services specializes in both “Spring Cleans” and Move In/Move Out cleanings in Georgetown, Round Rock, Cedar Park, Pflugerville and northern areas of Austin, Texas. If you do find that hiring a professional will work best for you, please give us a call at 512-931-2095 and I’d be glad to be of help!

Maria Dorian

Welcome Home Cleaning in Georgetown, Texas

Editor’s Note: I recommend a three-step process for my clients to get their homes ready for the market: making repairs, cleaning the home and then staging the home. In the slow market that Georgetown, Texas is experiencing right now, all three are critical components to making a lasting impression with the buyers and setting yourself apart from the competition.  What about you?  Do you have any “clean home” success stories (or disasters) that you can share?  All comments are welcome!  Thanks for reading!

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Craftsman-style home by Green Builders in Georgetown Texas

A few weeks ago, I helped one of my favorite clients, Rod and Carol, purchase a home by Green Builders in my neighborhood Georgetown Village. This was very special for me because it now meant that I have sold every major builder that has been built in this neighborhood! That would include Perry Homes, Bowen Homes and Origin Homes; which are the current builders, and also some past builders like David Weekley, Lennar and Morrison. That seems like a lot of builders for a small neighborhood of around 500 homes like Georgetown Village, but as we move forward, it seems as though only Green Builders and Perry Homes will be doing the bulk of the building.

After I showed the home to Rod and Carol I jokingly told them that I liked the floorplan so much that if they didn’t buy it, I would! The funny thing is, soon after they closed on the home, a contract on this home (pictured above) fell through and it came back on the market. It was the same exact floorplan as the one I had sold to Rod and Carol! So after a few days of negotiation, I am now the future owner of a Green Builders home! The beauty of this is that it’s just 5 houses down on my same street…so no moving truck needed:)

My wife is pretty excited because we gain an extra bedroom and lots more space. It may not look very large, but it’s 2400 SF and has 4 bedrooms, a gameroom, a study and a large studio above the garage which adds an additional 400 SF.

This studio is the main reason we’re moving. I’ve been blessed to be able to work from home, but the downside is that it’s hard to focus and concentrate with 3 kids running around in the home! Now, I can bring clients to my office without having to do the “5 minute house clean-up”, I can better focus on my work, and I’ll be better able to STAY AWAY from work when I’m with the family. I mean, what good is it to work from home yet not gain any additional quality time with the family?

So, here’s to HIGHER quality family time and LOWER energy bills!

If you have an experience with Green Builders please share them with me on this post! This blog is boring without any outside feedback and what you have to contribute can help somebody else!

Check out my home video for the tour:

I just read a great blog article entitled: Bribery to Work with the Builder’s Preferred Lender and I could certainly resonate with the author, Rhonda Porter. I wrote about the same subject on an earlier post (How to get a loan with a new home builder) advising consumers to be careful when choosing a lender and not get “blinded” by the incentives being offered.

Well, I decided to write a part 2 to the original article by Rhonda and talk about a similar practice involving a builder’s “preferred” Realtor.

I just got an email from a friend who wanted me to rebate the entire 3% of my commission to help him buy a home! After I did some quick math, I realized that I would be making ZERO on that particular deal. His proposal originated from the builder’s preferred realtor program: Use our real estate agent to list your house and that agent will rebate you 3% when you buy ours

Since the “preferred realtor” is the one who is listing the builder’s homes, and since she is rebating 100% of the buyer’s side commission, how can she legally represent and provide the appropriate services to that buyer?

Without proper representation, nobody is looking after that buyer’s best interest. The idea is that the average buyer does not know as much as a real estate agent does when it comes to buying a home. There is a power/knowledge imbalance. So to balance things out it is only fair that the person with the greater knowledge and power act in the interest of the client because it is too easy for someone with MORE power and MORE knowledge to harm someone with less. (edited from Rhonda’s original blog post).

So here is what I recommend that will cooperate and not compete with the real estate community:

(These examples assume that the builder’s bottom-line price for the home is $200,000)

BUYER HAS A HOME TO SELL:

1. Not represented by a Realtor - refer the buyer to a Preferred Realtor that will list their home and gladly rebate 1% of the new home back to the client. (Result: Preferred Realtor gets extra business, client gets full representation and saves 1%, builder sells house for $200,000)

2. Represented by a Realtor - offer to sell the home for 1% less then you normally would. (Result: Current real estate agent is not competing with a list of Preferred Realtors, client gets full representation and saves 1%, builder sells house for $198,000)

BUYER HAS NO HOME TO SELL

1. Not represented by a Realtor - Sell the home for $200,000

2. Represented by a Realtor -Sell the home for $200,000 (This cooperates with real estate community - buyer can’t get the home cheaper by ditching their agent)

I also recommend a simple set of criteria to make the “Preferred Realtor Program” live up to it’s name. Someone who is preferred should:

1. Have brought business to the builder in the past (That real estate agent has proved he/she is capable of bringing something to the table and can generate business for that builder)

2. Have listing experience. The current “preferred” Realtor in the above scenario has never sold one home in the city that the builder operates (Georgetown, Texas). Don’t just recommend an agent to your client that is willing to discount to get the business. Recommend somebody who actually has a strong performance record! My recommendation is to get that agent’s average DAYS ON MARKET for homes he/she has sold in the past 2-3 years. The builder shouldn’t recommend an agent who takes 6 months to sell their homes, they should recommend an agent that will take 33 days or less (my career average) so that the buyer can quickly move forward with the purchase of the builder’s home

I think this paints the builder in a very good light. It shows that they care for their customers and aren’t in business just to maximize profits. It shows that they also care for the community of real estate agents that are working hard to bring them business and are willing to cooperate, rather then compete, for their business. When you recommend a painter, a handyman or a doctor, wouldn’t you want it to be for the best benefit of the consumer? The same goes with a “Preferred Realtor Program” that not only looks out for the best interest of the consumer, but also the local real estate professionals that represent them

UPDATE 8/18/2008 - The builder in this post is no longer promoting the Upgrade program through their website and on-site brochures! I think they still have the program in place, but now the unrepresented buyer would have to ask for it first. That’s a great move on their part and will be well-respected by the real estate community!

I am a real estate agent. Let’s face it, when it comes to nest egg options, I doubt my broker has a 401k prepared for me. Therefore, I’m also a real estate investor. I buy homes and hold them for the long term. But what happens when these two roles collide? What should I do if, during the course of listing a home, I tell myself, “Gee, this is the exact type of home I’m looking for!” (Note: I really don’t use the word “Gee” in real life.)

Real World Situation

I just got off the phone with a nice young lady in my neighborhood, Georgetown Village, and was following up after a listing presentation I gave a few weeks ago. I was just about to finish the phone conversation when she made a comment that went something like this:

Some of my neighbors mentioned that you might not have my best interest in mind. They said that homes are selling in the $100/SF range and you list yours lower to maintain your statistics and sell your homes quicker (Note: My career average is 35 days). They also felt that there might have been a conflict of interest since you bought our neighbor’s home at a low price when you listed it, thus lowering values in our neighborhood.

I told her that it was a great question…and an honest one at that. I really respect the fact that she had the guts to confront me with this situation and give me an opportunity to respond. Whether I get this listing or not…thanks for doing the right thing! I encouraged her to call the individuals I bought the home from and get their first-hand testimonial when working with me. They would be the ones who could tell her whether I was being straight-forward and whether I tried to “pressure” them in any way. (Now I need to find their phone number!) In the meanwhile, I decided to dive deeper into the statistics of how much homes sold for in Georgetown Village….and how much I paid for my own listing.

Real World Numbers

The home I bought was built by Lennar and was 1603 SF. It was built in 2002 and although it didn’t have any significant upgrades, it was in very good condition. I paid $153,000 which comes out to $95.45/SF.

Since January of 2006, there were 10 resales that sold in the MLS that were built by Lennar and in the 1600 SF range (1603 SF - 1674 SF) and not ONE sold for $100/SF or higher. Do you want to know what the average $/SF was? $92.56/SF.

But wait, it gets better! In that same time period, there were two homes that sold in the MLS that were BRAND SPANKIN’ NEW! These homes were decked out with stainless steel appliances and upgraded hardware throughout the home…or rather, they didn’t have any ugly gold fixtures! Guess what the average $/SF was for these homes? $94.54/SF.

Yes, you read that correctly: I paid more $/SF for my home than the average comparable home that has sold in Georgetown Village for the past two years! In fact, I paid more $/SF for my home than two homes that were 5 years newer, had stainless steel appliances and were never lived in! Man, I need to quit letting my clients rip me off!

The Bottom Line: My integrity is worth far more than any investment home. Although I am self-employed, I do have a boss…he’s God. Ripping off a client is the last thing I want to do, because I am accountable for what I do and my actions reflect on the truthfulness of who I believe in. Here are a few important points to think about:

1. Did I really buy this home at a “great” price? It’s funny, but true: the home I bought was NEVER posted in the MLS and this is the FIRST time I have published it’s purchase price. So, how do people know how much (or how little) I paid for it? Neighborhood gossip is the last place to get accurate real estate information. Kudos to the lady who came straight to the source rather then rely on second-hand assumptions!

2. It seems like everybody is a real estate expert…except the real estate agents themselves! Read my most recent Georgetown Village case study to get the real scoop on what is selling for $100/SF or higher. $/SF is a good measurement for value, but if used out of context, and without supporting data, can be a dangerous and misleading catch-phrase. Get the facts! Only comparable homes that have recently sold determine the value of your house. If a real estate agent is determining the value of your home with something that hasn’t sold…run away….run away fast…..and hey, if you can multi-task , run away fast and call my number!

3. The seller is in control. It’s not just a good business practice, it’s also the law. Don’t you just hate pushy real estate agents that strong-arm you into making decisions you’re not comfortable making? Well, I do too. That’s why I always encourage my buyer AND sellers to make their own decisions when coming to a price. It’s my job to equip them with the data and inform them of pros and cons…it’s not my job to tell them what price to offer or list their home at. If you’re ever faced with a real estate agent that winks too much and has a gold tooth….or is using a high-pressured sales tactic on you, drop him like a ton of bricks.

In 2007, my homes stayed on the market for an average of 45 days (it was a tough year) versus the Georgetown average of 148 days. Don’t be fooled by real estate agents that “buy the listing” by offering to list your home for an inflated price. If a home takes 148 days to get an offer, trust me, it’s inflated…and around the 60 day mark, they’ll be coming to you for a price reduction that will mysteriously fall into my original recommended price range. So you decide: Sell it for market price now…or make some extra mortgage payments, deal with 20 extra showing appointments, and sell it for market price later.

So what do you think? Should I continue investing in my own neighborhood? Should homes be listed higher than market value so there is “room to negotiate?” Has a real estate agent ever bought your home? What was your experience? Please comment on my blog! Your comments are very much appreciated and keeps the conversation interesting!

I was reading a blog by Virginia Real Estate agent Frank Borges Llosa that correlated the amount of pictures a real estate agent posts with the time it takes to sell a home. In his example, the more pictures you post, the faster that house will sell and the more it will net!

Well, after reading that I had to put the Georgetown Market to the test. Will simply posting more pictures increase the chances of selling a home quicker and for more money? Here are the findings:

In 2007, there were 1262 listings that sold in Georgetown. 736 listings had posted 8 pictures (the previous maximum) or more. The current maximum pictures is now 12. The average days on market was 71 days and they netted an average of 97.9% (none of these figures include the amount asked for closing costs).

On the other end of the spectrum, 168 listings had posted only 1 picture or less. These sold for an average of 36 days and netted 96.9% of list price. Lastly, 526 listings posted 7 pictures or less and guess what? Days on market increased to 67 average days and 97.2% of list price. So this is how it looks like:

Listings with 8 or more pictures: 71 Days; 97.9% of List Price

Listings with 7 or less pictures: 67 Days; 97.2% of List Price

Listings with just 1 picture: 36 Days; 96.9% of List Price

What gives? It seems like the less pictures that are posted, the quicker a home sells! The only number that “makes sense” is that the homes tend to net more when they have more pictures. However, the difference is only 1% between posting a maximum of 8 pictures versus taking the lazy way out and posting 1 picture. I guess this 1% can translate to a good amount of money for an expensive listing, but won’t that be offset by the amount of time it takes to get that extra 1%? The difference between listings with 8 pictures versus 1 picture is 35 days, which is a whole mortgage payment!

You can either:

a. Use this as justification to get out of a lot more picture taking, editing and posting

b. Feel good that your agent only posted 1 picture for your listing because it’s the sure-fire way to sell a home quick

c. Don’t sweat this stuff and just hire Edward to list your home
In the past 5 years, my listings have sold for 98% of list price (including the amount asked for closing costs) and took an average of 31 days. How many pictures do I post? Well, I guess you’ll have to hire me to find out:)

Sorry, I couldn’t resist the free marketing.

Bottom Line: There is no magic formula for selling a home. Don’t get razzled and dazzled by fancy marketing brochures and gimmicks. Whether your agent sells 1 home a year or 100, what really counts is how long does it take them to sell a home and for what percent of list price. Make sure your agent can PROVE to you that he/she can sell your home quickly and net you the most. The only way to do that is to look at their past performance statistics. Mine are all available upon request. So the next time the real estate agent with the slick shoes tells you they can sell your home quicker and for more money, you just look them square in the eye and say…SHOW ME THE MONEY!

1.3 Millllllion Real Estate Agents exist….are you choosing the right one?

Let’s face it, it’s a tough market out there and getting found by a buyer or seller is critical to any real estate agent’s success. It’s more important then ever, that you find a real estate agent who is successful at what he/she does and is doing it honestly. I just ran across an article in RISMEDIA by Barry Hurd and he described unethical practices that real estate agents use to get their websites more noticed. One in particular caught my attention:

• Data blogs with no unique content (also known as splogs or scraper sites)

“With the creation of RSS (really simple syndication) the ability to import data into another site has become increasingly simple. Millions of spam blogs exists that have re-purposed duplicate content from hundreds of other sites, programmatically making changes to the original content to make it look slightly different. Typically these blogs give absolutely no credit to the originating author of the material and are breaking several copyright laws. Well-read online authors have this problem daily, hundreds of my articles have been stolen this way over the past two years. The primary reason for the existence of these sites is monetization through programs like Google Adsense which allows the site to profit off random traffic lured in using the stolen content.” (RISMEDIA, Jan 29, 2008 - Barry Hurd)

It’s one thing to quote somebody (which I just did), it’s another to take somebody’s work and use it as your own. Here’s an example of an article I published in February of 2007:

Georgetown, Texas Real Estate Agent Educates Custom Home Buyers

Proactive real estate agent in Georgetown, Texas dedicates himself to the ever-growing market for custom homes.

Austin, TX (PRWEB) February 14, 2007 — The Georgetown, Texas real estate scene continues to heat up, drawing homebuyers from all over the country. Many of these buyers are in search of custom homes, which are widely available in the Georgetown area. This has prompted one Georgetown real estate agent to carve out his own unique niche.

Edward Lui is one of the only real estate agents in Georgetown, Texas who focuses exclusively on the custom home market. He further distinguishes himself by providing an online resource focused on the Georgetown custom home market. Through his website, Edward gives homebuyers a one-stop shop for information about custom home builders, communities and resales in Georgetown, Texas.

Georgetown is located in Central Texas, just 25 miles north of Austin. In recent years, this area has become increasingly popular among homebuyers due to a variety of factors — good schools, business opportunities, wide-open spaces, and the live music scene and nightlife of Austin.

Many Texans relocate to Georgetown for a home in the country with easy access to the city (Austin), while also enjoying one of the state’s lowest property tax and crime rates. Out-of-state buyers relocate to Georgetown, Texas because the homes are more affordable than in their own states, and they fall in love with the charm and quality of life Georgetown, Texas has to offer.

Combine this influx of homebuyers with the variety of custom builders and communities in the area, and you’ve got a booming market for custom homes in Georgetown, Texas. That’s the exact audience Edward Lui hopes to educate and connect with through his website. Among other things, Edward’s website provides:

• Information on the most popular custom home communities around Georgetown
• A list of custom home builders in Georgetown, Texas.
• Custom homes that homebuyers can browse through by price range
• A Georgetown, Texas real estate and lifestyle guide full of relevant resources
• A forthcoming blog dedicated to the custom home market in Georgetown

“The website is just a first step,” Edward explained. “My goal is to provide a concierge level of service for anyone shopping for a custom home throughout the entire buying or building process. I want to go beyond what people would normally expect from a real estate agent, through the website as well as the services I provide.”

Learn More About Georgetown
To learn more about custom homes in Georgetown, Texas, or to contact Edward Lui, please visit http://www.GeorgetownCustomHomes.com or call Edward at 512-554-9594.

On the 1 year anniversary of this article I run across another article that looks strangely familiar (Agent’s name has been changed - everything NOT in bold is the same as the original article):

New: Georgetown, Texas Real Website to Educate Home Buyers

The Georgetown, Texas real estate scene announces it’s newest website where buyers can get the latest information on new and used homes in Central Texas.

Georgetown, TX (PRWEB) January 21, 2008 — The Georgetown, Texas real estate scene announces it’s newest website where buyers can get the latest information on new and used homes in Central Texas.

The Georgetown, TX homes for sale scene continues to heat up, drawing Georgetown home buyers from all over the country. Many of these buyers are in search of new and used homes, which are widely available in the Georgetown area. This has prompted one Georgetown TX real estate agent to carve out his own little niche.

Tally T is one of the real estate agents in Georgetown, Texas who focuses uniquely on the new & used home market. He separates himself further by providing an online resource focused on the resources required by the Georgetown Texas real estate market. Through his website, Tally T gives Texas home buyers & owners a one-stop shop for secrets about buying great homes, finding communities, and great school locations in Georgetown, Texas.

Georgetown is located in Central Texas. In the last few years, this area has become increasingly popular among home buyers due to a many factors — great schools, solid business opportunities, , and the live music scene and nightlife comparable to Austin.

Many relocate to Georgetown for a home in the country and quick access to the city, while also enjoying one of the state’s lowest property tax and crime rates. Out-of-state citizens enjoy Georgetown because of the lower home prices, and in the end they fall in love with the magic that Georgetown, Texas has to offer.

With all of these key ingredients in place, you’ve got a booming market for Georgetown TX New and Used Homes That’s the exact audience Tally T hopes to educate and connect with through his website. Just to name a few, Tally’s website provides:

• Information on the most popular communites around Georgetown
• A list of critical resources for any new home buyer in Georgetown, Texas.
• New homes with 15+ large photos that home buyers can browse through by price range
• Used homes with 15+ large photos that home buyers can browse through by price range
• A Georgetown, Texas real estate and lifestyle blog full of valuable tips

“The website is just the beginning,” Tally explained. “My goal is to provide a full range of services for anyone shopping for a new or used home throughout the entire buying or selling cycle. I want to go beyond what people would normally expect from a real estate agent.”

Learn More About Georgetown Texas!
To learn more about new and used homes in Georgetown, Texas, or to contact Tally T, please visit http://www.XXX.com or call Tally at 512-XXX-XXXX

Does anybody else but me see the similarities? This was kind of scary. Either I have a Siamese twin out there or somebody is taking some shortcuts! Earlier this month, somebody requested to quote some of my material for a new book she was writing. Although it seems like a great opportunity, I wonder how many books or blogs for that matter are comprised of original thought and how much is just quoted (or copied) content? I wonder if blogs should have a widget embedded in them that would give a ratio of quoted content to original thought. Lately, I’ve been cutting and pasting a lot of articles to my blog that I think would be relevant to my readers. Am I just as guilty or lazy? At the very least, I give credit to the original author. I see it more of a time saver and a service to my readers. Some people like to read the original article and not just get my “spin.” It’s also a lot easier then clicking around to different links that pop up dozens of windows on your screen. That’s why I quote.

Bottom Line: A good real estate agent isn’t somebody that can just drive you around in their car and fill out a contract. Make sure your real estate agent competes fairly in the market and has the respect of their peers. When they write an offer to their colleagues you can be sure their reputation precedes them.

I’m starting a new category called INSIDE SCOOP.
Unlike other real estate agents, my goal is not to convince you to buy something that you really don’t need or like. You’ll never find me trying to “sell” you on anything. Instead, I want to educate you and help you make the best decision possible. I am paid to advise you and give you my feedback on your choices…all the service, with none of the pressure.

Having said that, I realize that in my 4 years of real estate, I have come across information in the real estate industry that just has to be shared. It’s information that I would want my own family to know about if they were buying or selling a home in Georgetown, Texas. These articles can range from a pet peeve of mine to unscrupulous business practices and everything in between. I’ve posted my first article here.

Feel free to comment. I’m always interested in learning from others’ experiences.

Don’t forget to sign up for my blog by clicking the “Posts RSS” button on the left hand navigation bar and you’ll be sure to get more helpful information like this in the future.

(Read Part 1 of 2 here)

Here is the home I closed on last month! I had a renter for it before I closed on it too! (This is a great place to pick up rentals…that’s a post I’ll have to write about in the future).

Well, after I couldn’t get Lennar to match exactly the rate and closing costs of the outside lender, I took a closer look at the contract.

Lo and behold! I found a section in contract that indicated they would pay my Loan Origination Fee if I would use UAMC. I then called UAMC and asked them to buy down my interest rate to 6.15% to match my outside lender and then to add the cost to my Loan Origination Fee. They happily did that because:

1. They get paid more
2. They didn’t understand that Lennar was going to be footing the bill

Bottom line: I was able to close with Lennar’s in-house lender and not pay one extra cent! If I was greedy I could have asked them to buy it down further, but I wasn’t sure this was going to work or not and didn’t want to be stuck paying more at closing for this. They tried to wiggle out of it towards the end, but their Closing Coordinator was very cooperative. Another resource your real estate agent needs to connect with is this person!

If you’re shopping for a new home, give me a call and I’d love the opportunity to find you a great home AND great financing. Also, sign up for my blog by clicking the “Posts RSS” button on the left hand navigation bar and you’ll be sure to get more helpful information like this in the future.

~Edward

For those of you who know me, I’m not normally known for being a complainer or having many pet peeves. However, there is one thing that many new home builders do that really irritate me: Tying in incentives to using their lender.

These builders should be concerned about selling their home more than how you’re going to pay for it. It’s one thing if the financing terms they offer are unbeatable, then I would happily use them. However, often times they are offering terms that are thousands of dollars more than a comparable outside lender.

The auto industry and furniture industry are good examples of how to do it right. These days you can buy a car or a set of leather furniture and pay ZERO INTEREST for years! This is head and shoulders above any other financing terms you can obtain on your own…unless those terms involve gift money from the parents. The auto and furniture industry is willing to take a “hit” on the financing side to serve their overall purpose of moving product.

The more I think about it, it seems as though the builders are trying to sell their financing over moving their product. Is this backwards or what?

What should you do?

1. Most of my clients don’t want to deal with the hassle of “fighting the builder” for the best financing terms. However, I would always recommend getting at least one other Good Faith Estimate from an outside lender. When you do, compare only the closing costs associated with the loan (not the fees from title co, prepaids, etc.) and make sure you have given both lenders the same loan amount, percent down, tax/insurance estimates and loan product so you’re comparing apples to apples. I used Tracey Day with Home Source Mortgage and he beat the PANTS off of UAMC, Lennar’s in-house lender, by .60% and over $1300! (6.15% versus 6.75%).

2. Take your GFE from the outside lender and have your real estate agent forward it to the new home sales counselor and the in-house lender. Request that they either match those terms or allow you to use your own lender and keep the incentives.

3. If they don’t match the terms, they’ll lower theirs “as best they could.” The lender from UAMC gave me the “best possible GFE”…which narrowed the gap .25% and now just $725.

4. I then sent another email to the new home sales counselor and asked her to forward it to her supervisor explaining that they were STILL LESS COMPETITIVE and that I requested they make up the difference.

5. After doing that, I got another email from UAMC and then they gave me the “ABSOLUTE best possible GFE”…saving me another $250.

Did I take it? Stay tuned for part 2 of 2 and I’ll share the rest of the story after I close on Nov. 28th.