There's more to it than you might think

There is more to selling a home than you might think.  Superficially, a person might think that it will sell itself currently because, nationally, homes for sale receive 3.6 offers and they sell within 18 days. 

Any business student can probably list the four Ps of marketing: product, price, place, and promotion.  It may appear that there isn't much to selling a home: put a price on it; photograph it; put a sign in the yard; and, put it in MLS but, on closer scrutiny, there is a lot more that the best agents provide.

Long before the home goes on the market, the agent will create a detailed value and pricing study based on similar homes in size, price, proximity, and condition.  An overpriced home will sit on the market longer than it should.  The longer it stays on the market, buyers, as well as other agents, begin to wonder if there is something wrong with it.

The agent will develop a staging and declutter plan to make the house show at its best because first impressions matter and this type of effort provides a neutral canvas for buyers to start imagining their things in the home.

The marketing plan is a comprehensive strategy to consider every aspect of selling the home with the focus being to maximize efforts to get the highest possible price, in the shortest time with the fewest unanticipated events.

The individual marketing materials need to present the home in its best light.  It begins with professional photos because today's buyers will most likely, first see the home online and if the pictures don't make the property look good, they may decide not to see it. In addition, those photos will be used on the brochures for the home and just listed announcements, as well as social media.  They are crucial.

Among the most important value the agent brings to the table is their negotiation experience.  Every phase of the sale involves negotiation and the position of third-party negotiator eliminates an uncomfortable situation for sellers having to deal directly with buyers, other agents, appraisers, inspectors, and lenders.  Your listing agent will be your champion.

The following list includes typical things that most professionals will provide.  When interviewing an agent, feel comfortable to ask questions regarding their position on these items.  Another item you might find helpful is our Sellers Guide.

 

Listing Presentation

• Create Value/Pricing Study
• Staging/DeClutter Plan
• Develop Marketing Plan
• Document Preparation

Marketing

• Professional photos
• Property Description
• Lockbox
• Sign
• MLS & Portals
• Flyers
• Showings
• Open Houses
• Answer phones
• Just Listed/Just Sold
• Prospect for buyers
• Weekly Follow-up - Seller

• Inquiry phone calls
• Pre-qualify buyers
• Maintain files

Negotiations

• Meet with buyer's agent
• Write & Review contract
• Net sheet
• Present offer
• Negotiate

Pending

• Inspections
• Appraiser
• Resolve Issues
• Review Escrow Statement
• Track buyer' loan progress
• Coordinate closing
• Documents Review
• Attend final inspection
• Attend settlement

Assist 2 Sell Celebrating 25 years serving and saving in the Lehigh Valley!

Celebrating 25 years serving and saving in the Lehigh Valley! 

The leading discount real estate company in the Greater Lehigh Valley Area is celebrating 25 years of saving sellers thousands on commissions!  Assist 2 Sell Buyers & Sellers Realty, Inc. is the “Full Service with Savings” brokerage that delivers a complete real estate experience without the high cost of traditional real estate fees.  Since 2015 alone, Assist 2 Sell has saved Lehigh Valley sellers over $3.7 million in commissions when compared to 6%.  That’s almost $5,000 for the average seller and one seller who saved over $24,000!  Because Assist 2 Sell agents also represent buyers, sellers may pay as low as $3,995 to sell their home when Assist 2 Sell procures the buyer.

Each agent is a full time PA licensed agent belonging to the National, Pennsylvania and Greater Lehigh Valley Realtor associations.  Sellers contact Assist 2 Sell to find out about how they can save money on commission but are surprised to find that the home selling programs and advertising are on par with traditional agencies.  Homes get advertised in the MLS (GLVR & Bright), Realtor.com, Zillow, Trulia plus hundreds more websites syndicated by Listhub.  Each seller has a dedicated agent to walk them through the home selling process from pricing to settlement and everything in between.  The success of 25 years would not be possible without the positive reputation Assist 2 Sell has earned with their clients and real estate peers in the Greater Lehigh Valley.  

Will Soft Inquiries Hurt Your Credit Score?

Soft inquiries, sometimes known as a soft credit check or a soft credit pull, do not impact your credit scores because they are not attached to a specific application for credit.  They can occur when a credit card issuer or mortgage lender checks a person's credit for preapproval purposes.

Examples of soft inquiries are when you check your own credit or one of your current creditors checks your credit.  If you are concerned about the negative impact on your score, specify to the lender that you want a "soft pull" to see if you qualify for preapproval.

Soft inquiries may appear on your credit report but should not adversely affect your credit score.

Consumers are entitled to one free copy from each major credit bureau, Experian, Equifax and TransUnion, once every twelve months available at AnnualCreditReport.com. 

Hard inquiries occur when a borrower makes a new application for credit.  These will impact your credit score and will remain on your credit report for about two years.  The impact is usually minimal and scores tend to rebound within a few months if no new negative information appears.

Borrowers may be concerned about multiple inquiries when they are shopping for rates or even approvals.  Scoring models have algorithms to account for this situation if the inquires take place in a 14 to 45-day period. 

Even a hard inquiry should not necessarily concern you and probably, will only play a minor role in your score.  Soft inquiries, regardless of how many you may have will not impact your score.

Working with a trusted mortgage professional and sharing your concerns in advance of the "hard pull" is valuable.  This mortgage professional may even be able to advise you on some things that could improve your credit score which may actually improve your score which could result in qualifying for a lower rate that could save thousands and possibly, tens of thousands of dollars over the life of your mortgage.

Your real estate professional can recommend a trusted mortgage professional to you.

Paying Down Your Mortgage

When the situation arises that you have a lump sum of cash to pay down your existing mortgage,  there may be different options available.  Pre-paying principal on a fixed-rate mortgage shortens the term of the mortgage but the payment stays the same.

Conversely, recasting a mortgage with a lump-sum principal payment lowers the principal and interest payment but leaves the term intact with the same payoff date.

The interest rate on the mortgage will stay the same regardless.  Prepaying principal can be done at any time but may not be applied until the next payment date.  Recasting cannot be done within the first 90-days of a mortgage.

Pre-paying principal is like driving faster on a trip to a specific destination to get you there sooner.  Recasting/Re-amortization gets you to the destination at the same estimated time of arrival but using less fuel.

Most loans allow you to pre-pay principal, but recasting is not allowed on FHA, VA, and GNMA.  If you have a conventional loan, check with your lender to see if it is possible.

Contact your mortgage servicer for specific information on pre-paying or recasting your mortgage before acting.

An Easy Fix to Avoid a Flood in Your Home

Do you remember if or when you have replaced your washing machine hoses?  Are they the original hoses and if so, how old is your washing machine?  It is recommended that washing machine supply hoses should be replaced every five to seven years. 

Washing machines, like all appliances, are expected to work and when they don't, it's time to have them fixed or replaced.  However, there is a critical connection from the water supply that may even be older than your washing machine itself.

Eventually, unless hoses are replaced, they will fail, which on the mild side could be slow leaks or burst entirely, and could cause a catastrophic flood in the home.  The failure could come from a number of causes including age, improperly installation, poor-quality materials or poor design.

The hoses are generally under the same pressure as the other plumbing in the home.  Imagine having an open faucet running directly on your floor.

Ask someone whose hose broke while they were asleep or out of town and you'll hear stories of how quickly the water can damage walls, flooring, and furniture.  Almost anyone with a pair of pliers can replace the hoses for under $30.00 to avoid this potential disaster.

As you're shopping for the replacement hoses, consider the braided stainless steel connectors available at any home center.  The advantage is that the stainless steel offers additional protection in case a soft spot develops in the hose beneath.  They'll cost a little more but offer considerably more protection for a nominal additional price.

In Search of a Big Mortgage

The Fannie Mae and Freddie Mac loan limits are adjusted annually to keep up with cost of living but with the appreciation experienced in many markets, it may not be enough. When the conforming loan limit is not enough, qualified buyers can turn to a jumbo loan.

The maximum loan limit on conforming, conventional loans for 2022 is $625,000 for a single-family home but is increased up to $937,500 for designated high price areas.  The underwriting guidelines for conforming loans are consistent with regards to things like minimum down payment, private mortgage insurance, debt-to-income ratio, minimum credit score and cash reserves required.

Jumbo loans are loans more than the FNMA maximum limits and are considered non-conforming loans.  This allows lenders to set their own requirements on maximum loan amount, minimum required credit score, maximum debt-to-income ratio, and minimum down payment.

The rates paid on the jumbo loans may be the same as conforming loan rates.  It might sound logical that a larger loan would have more risk and therefore, be priced higher.  Lenders do not sell jumbo loans to FNMA which saves them the guarantee fee normally required.    This makes the jumbo loan more profitable.  Borrowers are encouraged to shop the rates. 

A minimum credit score of 700 will probably be required together with a debt-to-income ratio below 45%.  While many borrowers seeking a jumbo may be putting 20% down, it is possible to find a lender who may only require 10% down payment.  Lenders may be more lenient with regards to mortgage insurance.

Lenders may also require six to twelve months of cash reserves due to the increased risk of the larger loan amount.

It is a common practice for banks to make jumbo loans to attract other business that the borrower might be able to influence like company, corporate, or investment accounts.

Credit Utilization Affects Your Score

Credit utilization reflects how much of your available credit is being used at a given time.  Lower credit utilization indicates that a borrower is not heavily relying on their credit and that they are using their credit responsibly.

Is calculated by dividing your total credit card balances by your total limits.  The higher the percentage, the higher the risk which adversely affects the credit score according to most of the companies.  It is recommended that your credit utilization be under 30% to positively impact your credit score.

If the available limit on a credit card is $12,000 and their normal monthly balance is around $3,000, they have a credit utilization of 25%.  If for whatever reason, the borrower's available limit was reduced to $6,000, and their long history of having a monthly balance of $3,000, the ratio, then, increases to 50% which will likely lower their credit score.

For borrowers who use more than 30% of their available credit and regularly pay off the bill each month, they should consider making payments toward the balance more frequently, like every two weeks.  This keeps the balance lower, and, in many cases, the card issuer will only report the credit activity once a month to the credit bureau, usually on the monthly closing date of the account.

Another option may be to use multiple cards, if they are available, for the purchases during the month.  Based on the limits of each card, this could result in lower utilization on a single card.

You could also ask for your available credit to be increased.  Assuming you have a good history of paying on time, this may be an easy fix.  Before doing this, ask if it could negatively impact your credit score because it will be reported as a hard inquiry on your credit.

If you are trying to improve your score to qualify for a mortgage, consult with a trusted mortgage professional who can advise you specifically for your situation.  If you would like a recommendation, please contact meinfo@yourlehighvalleyhome.com.