Homes that sold in Washington County in the $250,000 range during the month of November, 2009.

Jackson, WI

3036 Sherman Parc Cir

Selling Price: $249,900

• 4 Bedrooms, 2.5 Baths
• 2,002 square feet
• 4 car attached garage
• .290 acre
• 2008 Taxes: $0.00 (partial)
• Original Asking Price: $269,900
• Final Asking Price: $249,900
• Closing Date: 11/06/2009
• Total Days on Market: 119
• Price per Square Foot: $124.83

Richfield, WI

440 Belvedere W

Selling Price: $250,000

• 3 Bedrooms, 2 Baths
• 1,932 square feet
• 2.5 car attached garage
• Between 1 and 3 acres
• 2008 Taxes: $3,435.04
• Original Asking Price: $258,000
• Final Asking Price: $250,000
• Closing Date: 11/23/2009
• Total Days on Market: 134
• Price per Square Foot: $129.40

Slinger, WI

166 Countryside Dr

Selling Price: $244,310

• 3 Bedrooms, 2 Baths
• 1,456 square feet
• 2 car attached garage
• .290 acre
• 2008 Taxes: $1,278.86 (partial)
• Original Asking Price: $246,900
• Final Asking Price: $254,490
• Closing Date: 11/09/2009
• Total Days on Market: 246
• Price per Square Foot: $167.80

Erin, WI

5388 County Rd Q

Selling Price: $259,900

• 3 Bedrooms, 2 Baths
• 5 car attached garage
• 1.83 acres
• 2008 Taxes: $3,485.00
• Original Asking Price: $284,991
• Final Asking Price: $259,900
• Closing Date: 11/23/2009
• Total Days on Market: 251

Germantown, WI

W143N9915 Ridgewood Ln

Selling Price: $259,000

• 3 Bedrooms, 2.5 Baths
• 2.5 car attached garage
• .240 acre
• 2008 Taxes: $4,523.09
• Original Asking Price: $289,500
• Final Asking Price: $267,900
• Closing Date: 11/17/2009
• Total Days on Market: 113

Posted in: Housing Market
Tags: erin, germantown, Home Buying, home selling, jackson, Real estate, richfield, slinger

So far, this is the best description I could find for the updated loan modification law without having to shell out $50.

Based on that bit of research, I would encourage anyone looking to modify their mortgages to be very careful. As with anything that is supposedly designed to help people out, there are tons of scams out there. Take your time and do your research.

I will continue to research this subject and post anything that I find that conflicts with the information below.

I researched as best I could, but please do not take this as a definitive reference on the subject. PLEASE do your own research before jumping into ANY loan modification program.

Trial Period Requirement:

No payments will be made to the lender/investor, servicer or debtor until after the Trial modification Period is successfully completed and the entry of agreements to the plan between the servicer and the Treasury’s financial agent.

Modification will be in effect the first calendar month after the trial period is completed successfully. Successful completion is defined as being current as per MBA calculation at the End of the Trial Period.

Debtors in foreclosure restart states will fail the Trial Period if they are not current when the Foreclosure sale is scheduled to being.

The lender/investor, debtor, or servicer will not be paid during the Trial Period, if the Trial Period is completed unsuccessfully, or if the servicer has not entered into the agreements of the plan.

Trial Period Duration:

The Trial Period will last for the duration of 90 days (meaning 3 modified term payments) or longer if it is necessary in order to comply with the contractual obligations of the investor. In order to receive a Domestic Economical Modification, the debtor must be current upon the end of the Trial Period.

Escrows:

Servicers must escrow for debtor’s mortgage-related insurance payments and real estate taxes if they can process these payments or are using a third party for this already. If they can not, they must be able to do so within 6 months of agreeing to the Plan.

Requirements for Counseling:

The servicer must inform debtors with a Back-End DTI of 55% or higher about the advantages and affordability of counseling. In addition, they must give the debtor a letter informing said debtor of their requirement of counseling and provide the debtor with a list of HUD-approved counselors. In order to start the counseling, this letter may be a requirement. The modification will not be in effect until the debtor affirms in writing that he/she will get counseling.

Assumable:

In the event that the modified loan was assumable before modification, the Domestic Economical Modification will void this.

Debtor Modification Fees:

The debtor will not be charged modification fees.

Modification Fees the Investor can Reimburse:
The investor can reimburse modification fees and charges, including notary fees, property valuation, and other fees. This will take place through the normal procedure between the investor and servicer.

Unpaid Late Fees Waived:

Late fees that are not paid shall be waived for the debtor, including late fees before and during the Trial Period.

Credit Report:

Credit report cost will be covered by the investor.

Posted in: Foreclosure
Tags: Foreclosure, loan modification

Your house should always be available for show, even though it may occasionally be inconvenient for you. Let your listing agent put a lock box in a convenient place to make it easy for other agents to show your home to homebuyers. Otherwise, agents will have to schedule appointments, which is an inconvenience. Most will just skip your home to show the house of someone else who is more cooperative.

Most agents will call and give you at least a couple of hours notice before showing your property. If you refuse to let them show it at that time, they will just skip your house. Even if they come back another time, it will probably be with different buyers and you may have just lost a chance to sell your home.

Try Not to be Home
Homebuyers will feel like intruders if you are home when they visit, and they might not be as receptive toward viewing your home. Visit the local coffee house, yogurt shop, or take the kids to the local park. If you absolutely cannot leave, try to remain in an out of they way area of the house and do not move from room to room. Do not volunteer any information, but answer any questions the agent may ask.

Lighting
When you know someone is coming by to tour your home, turn on all the indoor and outdoor lights – even during the day. At night, a lit house gives a “homey” impression when viewed from the street. During the daytime, turning on the lights prevents harsh shadows from sunlight and it brightens up any dim areas. Your house looks more homey and cheerful with the lights on.

Fragrances
Do not use scented sprays to prepare for visitors. It is too obvious and many people find the smells of those sprays offensive, not to mention that some may be allergic. If you want to have a pleasant aroma in your house, have a potpourri pot or something natural. Or turn on a stove burner (or the oven) for a moment and put a drop of vanilla extract on it. It will smell like you have been cooking.

Pet Control
If you have pets, make sure your listing agent puts a notice with your listing in the multiple listing service. The last thing you want is to have your pet running out the front door and getting lost. If you know someone is coming, it would be best to try to take the pets with you while the homebuyers tour your home. If you cannot do that, It is best to keep dogs in a penned area in the back yard. Try to keep indoor cats in a specific room when you expect visitors, and put a sign on the door. Most of the time, an indoor cat will hide when buyers come to view your property, but they may panic and try to escape.

The Kitchen Trash
Especially if your kitchen trash can does not have a lid, make sure you empty it every time someone comes to look at your home – even if your trash can is kept under the kitchen sink. Remember that you want to send a positive image about every aspect of your home. Kitchen trash does not send a positive message. You may go through more plastic bags than usual, but it will be worth it.

Keep the House Tidy
Not everyone makes his or her bed every day, but when selling a home it is recommended that you develop the habit. Pick up papers, do not leave empty glasses in the family room, keep everything freshly dusted and vacuumed. Try your best to have it look like a model home – a home with furniture but nobody really lives there.

Posted in: Sell Your Home
Tags: decluttering, home selling, Real estate, staging

Handy tips from RISMedia:

1. Unheated house in winter months. If the home has been properly winterized, there’s no need for heat. But if the home has not been properly winterized, pipes will burst and cause water damage.

2. Missing sinks, toilets and other fixtures. Make sure they’ve been properly removed and not ripped from walls and floors.

3. Peeling, bubbling, and discolored paint; swelling in walls or ceilings (especially around kitchens and bathrooms) or a musty odor all indicate water damage and, potentially, the presence of moisture and mold.

4. Fungus growth inside cabinets, behind drawers and built-ins. Fungus could mean that there has been water damage. Since water falls down, look for the source above the mold.

5. Blocked drains or pipes will cause future problems and may have already created sewage backups.

6. Black cobwebs, greasy gray residue on walls and/or a strong oily odor. This could point to potential soot damage or a malfunctioning furnace.

7. An older home with extensive renovations. Check with the city for pulled permits in order to get remolding details. If asbestos is present and has been disturbed, be sure it’s been remediated by a certified specialist.

8. Excessive painting of every nook, cranny, door and floor may mean that the seller is covering up mold.

9. Discolored subflooring. From the basement, check the subflooring above for stains and small holes, both caused by mold.

10. Air Quality. The air quality within a home tells a lot about the home’s condition. Be sure to include air and surface testing in your home inspection. It’s a few hundred dollars well spent.

Posted in: Home Buying
Tags: foreclosures, Home Buying

From McClatchy News:

WASHINGTON — Ten months after the Obama administration began pressing lenders to do more to prevent foreclosures, many struggling homeowners are holding up their end of the bargain but still find themselves rejected, and some are even having their homes sold out from under them without notice.

These borrowers, rich and poor, completed trial modifications of their distressed mortgage, and made all the payments, only to learn, often indirectly, that they won’t get help after all.

How many is hard to tell. Lenders participating in the administration’s Home Affordable Modification Program, or HAMP, still don’t provide the government with information about who’s rejected and why.

To date, more than 759,000 trial loan modifications have been started, but just 31,382 have been converted to permanent new loans. That averages out to 4 percent, far below the 75 percent conversion rate President Barack Obama has said he seeks.

In the fine print of the form homeowners fill out to apply for Obama’s program, which lowers monthly payments for three months while the lender decides whether to provide permanent relief, borrowers must waive important notification rights.

This clause allows banks to reject borrowers without any written notification and move straight to auctioning off their homes without any warning.

That’s what happened to Evangelina Flores, the owner of a modest 902 square-foot home in Fontana, Calif. She completed a three-month trial modification, and made the last of the agreed upon monthly payments of $1,134.60 on Nov. 1. Her lawyer said that in late November, Central Mortgage Company told her that it would void her adjustable-rate mortgage, which had risen to a monthly sum above $2,000, and replace it with a fixed-rate mortgage.

“The information they had given us is that she had qualified and that she would be getting her notice of modification in the first week of December,” said George Bosch, the legal administrator for the law firm of Edward Lopez and Rick Gaxiola, which is handling Flores’ case for free.

Flores, 58, a self-employed child care worker, wired her December payment to Central Mortgage Company on Nov. 30, thinking that her prayers had been answered. A day later, there was a loud, aggressive knock on her door.

Thinking a relative was playing a prank, she opened her front door to find two strangers handing her an eviction notice.

“They arrived real demanding, saying that they were the owners,” recalled Flores. “I have high blood pressure, and I felt awful.”

Court documents show that her house had been sold that very morning to a recently created company, Shark Investments. The men told Flores she had to be out within three days. The eviction notice had a scribbled signature, and under the signature was the name of attorney John Bouzane.

A representative in his office denied that Bouzane’s law firm was involved in Flores’ eviction, and said the eviction notice was obtained from Bouzane’s Web site, www.fastevictionservice.com.

Why would a lawyer provide for free a document that gives the impression that his law firm is behind an eviction?

“We hope to get the eviction business,” said the woman, who didn’t identify herself.

Flores bought her home in 2006 for $352,000. Records show that it has a current fair-market value of $99,000. The new owner bought it for $78,000 at an auction Flores didn’t even know about.

“I had my dream, but now I feel awful,” said Flores, who remains in the house while her lawyers fight her eviction. “I still can’t believe it.”

How could Flores go so quickly from getting government help to having her home owned by Shark Investment? The answer is in the fine print of standard HAMP documents.

The Aug. 25 cover letter from Central Mortgage Company, the servicer that collects Flores’ mortgage payments, offered Flores a trial modification with this comforting language:

“If you do not qualify for a loan modification, we will work with you to explore other options available to help you keep your home or ease your transition into a new home.”

CMC is owned by Arkansas regional Arvest Bank, itself controlled by Jim Walton, the youngest son of Wal-Mart founder Sam Walton.

A glance past CMC’s hopeful promise finds a different story in the fine print of HAMP document, which contains standardized language drafted by the Obama Treasury Department and is used uniformly by lenders.

The document warns that foreclosure “may be immediately resumed from the point at which it was suspended if this plan terminates, and no new notice of default, notice of intent to accelerate, notice of acceleration, or similar notice will be necessary to continue the foreclosure action, all rights to such notices being hereby waived to the extent permitted by applicable law.”

This means that even when a borrower makes all the trial payments, a lender can put the house up for auction if it decides that the homeowner doesn’t qualify — assuming that foreclosure proceedings had been started before the trial period — without telling the homeowner.

Until now, lenders haven’t even had to notify borrowers in writing that they’d been rejected for permanent modifications.

In January, 11 months after Obama’s plan was announced, homeowners will begin receiving written rejection notices, and the Treasury Department finally will begin receiving data on rejection rates and reasons for rejections.

The controversial clause notwithstanding, the handling of Flores’ loan raises questions.

“Foreclosure actions may not be initiated or restarted until the borrower has failed the trial period and the borrower has been considered and found ineligible for other available foreclosure prevention options,” said Meg Reilly, a Treasury spokeswoman. “Servicers who continue with foreclosure sales are considered non-compliant.”

CMC officials declined to comment and hung up when they learned that a reporter was listening in with permission from Flores’ legal team. Arvest officials also declined comment.

McClatchy did hear from Freddie Mac, the mortgage finance agency seized by the Bush administration in September 2008. Freddie owns Flores’ loan, and spokesman Brad German insisted that Flores was reviewed three times for loan modification.

“In each instance, there was a lack of documentation verifying that she had the income required for a permanent modification,” German said.

That response is ironic, said Michael Calhoun, the president of the Center for Responsible Lending, a nonpartisan group in Durham, N.C., that works on behalf of borrowers.

“These lenders gave loans with no documentation and charged them a penalty interest rate for doing so. And now when the people ask for help, they are using extravagant demands for documentation to give them the back of their hand and continue to foreclosure,” Calhoun said.

German said that Flores was sent a letter on Nov. 24, which would have arrived several days later, given the Thanksgiving holiday, informing her that she’d been rejected for a permanent modification. Flores and her attorney said she never got a letter, and neither Freddie Mac nor CMC provided proof of that letter.

Exactly one week after the letter supposedly was sent, Flores’ home was sold to Shark Investments. That company was formed on Aug. 19, according to records on the California Secretary of State’s Web site. Shark Investments, apparently an unsuspecting beneficiary of Flores’ woes, has no phone listing. The Riverside, Calif., address on the company’s filing as a limited liability company traces to a five-bedroom, four-bath house with a swimming pool.

German didn’t comment on whether Flores received sufficient notice under Freddie Mac rules, or how the home could move to sale so quickly.

Flores’ legal team, which specializes in foreclosure prevention, thinks that lenders and servicers are gaming Obama’s housing effort.

“It seems servicers are giving people false hopes by sending them a plan, and they are using the program as a collection method, getting people to pay them with no intention of modifying the loan,” said Bosch. “I believe they are using this as a tool to suck people dry.”

Dashed hopes aren’t exclusive to the working poor such as Flores.

David Smith owns a beautiful home in San Clemente, Calif., the location of Richard Nixon’s “Western White House.” Smith purchased his five bedroom home four years ago for $1.3 million. Today, the real estate Web site Zillow.com estimates the value of Smith’s home at $981,000, slightly below the $1 million he still owes on it.

Smith said he went from “making a lot of money to making hardly any” as the national and California economies plunged into deep recession. He’s a salesman serving the hard-hit residential and commercial construction sector. On top of his hardship, Smith’s mortgage exceeds the limits for the HAMP plan.

In late August, Smith signed and returned paperwork in a prepaid FedEx envelope to Bank of America that said it had received the contract needed to modify the adjustable-rate mortgage he originally took out with the disgraced lender Countrywide Financial, which Bank of America bought last year.

The modification agreement shows that Bank of America agreed to give Smith a 3.375 percent mortgage rate through September 2014, and everything Smith paid between now and through 2019 would count as paying off interest. He’d begin paying principal and interest in October 2019, with the loan maturing in 2037.

The deal favors the lender, but Smith, 55, jumped on it because it kept him in the home.

Armed with what he thought was “a permanent modification,” Smith returned a notarized copy of the agreement and made subsequent payments on time.

In return, he got a surprising notice from Bank of America saying that his house would be auctioned off on Dec. 18.

“It looks like they’re trying to sell this out from underneath me,” Smith said. “My wife cries all the time.”

After a Dec. 16 call from McClatchy asking why Bank of America wasn’t honoring its own modification, the lender backed off.

“The case has been returned to a workout status and a Home Retention Division associate will be contacting Mr. Smith for further discussions,” said Rick Simon, a Bank of America spokesman. “The scheduled foreclosure sale will be postponed for at least 30 days to allow for review of the account in hope of completing a home retention solution for Mr. Smith.”

The Center for Responsible Lending says such problems are common.

“Everyone acknowledges that the system is not working well,” Calhoun said.

Posted in: Foreclosure
Tags: barack obama, foreclosures, HAMP, Home Affordable Modification Program, lenders, loan modification

Homes that sold in Southeaster Wisconsin (Milwaukee, Waukesha, Walworth, Racine, Kenosha, Ozaukee, Washington and Jefferson Counties) for over $1 Million during November 2009.

Milwaukee, WI

2505 N Wahl Ave

Selling Price: $1,350,000

• 4 Bedrooms, 2.5 Baths
• 6,917 square feet
• 4.5 car attached garage
• .30 acre
• 2008 Taxes: $28,286
• Original Asking Price: $2,300,000
• Final Asking Price: $1,549,000
• Closing Date: 11/20/2009
• Total Days on Market: 260
• Price per Square Foot: $195.17

Delafield, WI

N22W28656 Louis Ave

Selling Price: $1,125,000

• 4 Bedrooms, 2.5 Baths
• 5 car detached garage
• .880 acre
• 2008 Taxes: $14,677
• Original Asking Price: $1,489,000
• Final Asking Price: $1,489,000
• Closing Date: 11/11/2009
• Total Days on Market: 232

Twin Lakes, WI

1519 E Lakeshore Dr

Selling Price: $1,225,000

• 4 Bedrooms, 3 Baths
• 2,640 square feet
• 2.5 car attached garage
• Between .50 and 1 acre
• 2008 Taxes: $18,786
• Original Asking Price: $1,399,000
• Final Asking Price: $1,399,000
• Closing Date: 11/04/2009
• Total Days on Market: 43
• Price per Square Foot: $475.38

Mequon, WI

9400 W Highland Rd

Selling Price: $1,000,000

• 4 Bedrooms, 4.5 Baths
• 5,284 square feet
• 7 car attached garage
• 20 acre
• 2008 Taxes: $18,017
• Original Asking Price: $1,599,000
• Final Asking Price: $1,295,000
• Closing Date: 11/18/2009
• Total Days on Market: 331
• Price per Square Foot: $189.25

Oconomowoc Lake, WI

34675 W Fairview Rd

Selling Price: $2,200,000

• 3 Bedrooms, 3.5 Baths
• 5,490 square feet
• 10 car attached garage
• 2.44 acres
• 2008 Taxes: $24,139
• Original Asking Price: $2,199,000
• Final Asking Price: $2,199,000
• Closing Date: 11/12/2009
• Total Days on Market: 215
• Price per Square Foot: $400.73

West Bend, WI

4951 Birchwood Rd

Selling Price: $1,650,000

• 5 Bedrooms, 3.5 Baths
• 2.5 car attached garage
• 2+ acres
• 2008 Taxes: $16,677
• Original Asking Price: $2,590,000
• Final Asking Price: $1,990,000
• Closing Date: 11/4/2009
• Total Days on Market: 217

Fox Point, WI

7240 N Barnett Ln

Selling Price: $1,580,000

• 5 Bedrooms, 5.5 Baths
• 6,250 square feet
• 3 car attached garage
• 1.19 acres
• 2008 Taxes: $29,496
• Original Asking Price: $1,695,000
• Final Asking Price: $1,695,000
• Closing Date: 11/12/2009
• Total Days on Market: 96
• Price per Square Foot: $252.80

Posted in: Housing Market
Tags: delafield, fox point, Home Buying, home selling, luxury homes, mequon, million dollar sales, milwaukee, oconomowoc lake, Real estate, twin lakes, west bend, wisconsin

Homes that sold in Milwaukee County in the $250,000 range during the month of November, 2009.

Greenfield, WI

12136 W Barnard Ave

Selling Price: $250,000

• 4 Bedrooms, 2.5 Baths
• 2,070 square feet
• 2 car attached garage
• .290 acre
• 2008 Taxes: $1,709.00 (partial)
• Original Asking Price: $290,400
• Final Asking Price: $249,900
• Closing Date: 11/30/2009
• Total Days on Market: 398
• Price per Square Foot: $120.77

Hales Corners, WI

11401 Arrowhead Trail

Selling Price: $247,500

• 4 Bedrooms, 2 Baths
• 1,874 square feet
• 2 car attached garage
• .520 acre
• 2008 Taxes: $5,857.25
• Original Asking Price: $289,900
• Final Asking Price: $249,900
• Closing Date: 11/20/2009
• Total Days on Market: 249
• Price per Square Foot: $132.07

Whitefish Bay, WI

630 E Fairmount Ave

Selling Price: $242,000

• 3 Bedrooms, 1.5 Baths
• 1,288 square feet
• 1.5 car attached garage
• .120 acre
• 2008 Taxes: $5,246.91
• Original Asking Price: $259,000
• Final Asking Price: $259,900
• Closing Date: 11/16/2009
• Total Days on Market: 123
• Price per Square Foot: $187.89

Franklin, WI

7737 W Margaret Ln

Selling Price: $255,000

• 3 Bedrooms, 2.5 Baths
• 2,059 square feet
• 2.5 car attached garage
• .466 acre
• 2008 Taxes: $6,464.67
• Original Asking Price: $269,000
• Final Asking Price: $259,900
• Closing Date: 11/10/2009
• Total Days on Market: 41
• Price per Square Foot: $123.85

Milwaukee, WI

2029 E Kenwood Blvd

Selling Price: $255,000

• 3 Bedrooms, 1 Baths
• 1,559 square feet
• 2 car detached garage
• .110 acre
• 2008 Taxes: $5,671.50
• Original Asking Price: $264,500
• Final Asking Price: $264,500
• Closing Date: 11/06/2009
• Total Days on Market: 143
• Price per Square Foot: $163.57

Fox Point, WI

8065 N Navajo Rd

Selling Price: $257,000

• 3 Bedrooms, 2 Baths
• 1,630 square feet
• 2 car attached garage
• 2008 Taxes: $5,756.53
• Original Asking Price: $264,900
• Final Asking Price: $264,900
• Closing Date: 11/09/2009
• Total Days on Market: 51
• Price per Square Foot: $157.67

Oak Creek, WI

1021 E Mary Ln

Selling Price: $248,900

• 3 Bedrooms, 2.5 Baths
• 2,164 square feet
• 2.5 car attached garage
• 2008 Taxes: $5,796.98
• Original Asking Price: $274,900
• Final Asking Price: $264,900
• Closing Date: 11/27/2009
• Total Days on Market: 226
• Price per Square Foot: $115.02

Shorewood, WI

4309 N Morris Blvd

Selling Price: $260,000

• 2 Bedrooms, 1.5 Baths
• 1,528 square feet
• 1 car detached garage
• 2008 Taxes: $6,660.04
• Original Asking Price: $268,000
• Final Asking Price: $268,000
• Closing Date: 11/20/2009
• Total Days on Market: 249
• Price per Square Foot: $170.16

Posted in: Housing Market
Tags: fox point, franklin, greenfield, hales corners, Home Buying, home selling, milwaukee, oak creek, Real estate, shorewood, whitefish bay

Meeting With Realtors

So you’ve decided to sell your home and have a fairly good idea of what you think it is worth. Being a sensible home seller, you schedule appointments with three local listing agents who’ve been hanging stuff on your front doorknob for years. Each Realtor comes prepared with a “Competitive Market Analysis” on fancy paper and they each recommend a specific sales price.

Amazingly, a couple of the Realtors have come up with prices that are lower than you expected. Although they back up their recommendations with recent sales data of similar homes, you remain convinced your house is worth more.

When you interview the third agent’s figures, they are much more in line with your own anticipated value, or maybe even higher. Suddenly, you are a happy and excited home seller, already counting the money.

A Sales Practice Called “Buying a Listing”

If you’re like many people, you pick Realtor number three. This is an agent who seems willing to listen to your input and work with you. This is an agent that cares about putting the most money in your pocket. This is an agent that is willing to start out at your price and if you need to drop the price later, you can do that easily, right?

After all, everyone else does it!

The truth is that you may have just met an agent engaging in a questionable sales practice called “buying a listing.” He “bought” the listing by suggesting you might be able to get a higher sales price than the other agents recommended. Most likely, he is quite doubtful that your home will actually sell at that price. The intention from the beginning is to eventually talk you into lowering the price.

Why do some agents “buy” listings this way?

There are basically two reasons. A well-meaning and hard working agent can feel pressure from a homeowner who has an inflated perception of his home’s value. On the other hand, there are some agents who engage in this sales practice routinely.

What Happens Behind the Scenes

If you start out with too high a price on your home, you may have just added to your stress level — and selling a home is stressful enough. There will be a lot of “behind the scenes” action taking place that you don’t know about.

Contrary to popular opinion, the listing agent does not usually attempt to sell your home directly to a homebuyer. That would be inefficient.

Listing agents market and promote your home to the hordes of other local agents who do work with homebuyers, dramatically increasing your personal sales force. During the first couple of weeks your home should be a flurry of activity with buyer’s agents coming to preview your home so they can sell it to their clients.

If the price is right.

If you and your agent have overpriced, fewer agents will preview your home. After all, they are Realtors, and it is their job to know local market conditions and home values. If your house is dramatically above market, why waste time? Their time is better spent previewing homes that are priced realistically.

Dropping Your Price…Too Late

If you start out with a high sales price, then drop it later — your house is “old news.” You will never be able to recapture that flurry of initial activity you would have had with a realistic price. Your house could take longer to sell.

Even if you do successfully sell at an above market price to an uninformed buyer, your buyer will need a mortgage. The mortgage lender requires an appraisal. If comparable sales for the last six months and current market conditions do not support your sales price, the house won’t appraise. Your deal falls apart. Of course, you can always attempt to renegotiate the price, but only if the buyer is willing to listen.

Your house could go “back on the market.”

Once your home has fallen out of escrow or sits on the market awhile, it is harder to get a good offer. Potential buyers will think you might be getting desperate, so they will make lower offers. By overpricing your home in the beginning, you could actually end up settling for a lower price than you would have normally received.

Realtors Talk to Each Other

If you start out with a sales price that is too high, there is a high likelihood you interviewed other agents. They didn’t get the listing, of course. They got “aced out” by someone telling you what you wanted to hear.

If your listing agent routinely engages in “buying” listings, he has probably aced out scores of other agents in the same way. Being human, Realtors talk to each other. If they don’t like your listing agent, not as many of them will be showing your home.

In short, you may have ended up with an agent who was good at selling you , but not good at selling your house . And you’re going to pay them a commission for it.

It is human nature for you to want the highest price for your home. However, when you choose the agent who promises what you want to hear, it often leads to stress and frustration. Most of the time, it will take you longer to sell your home. Possibly, you will end up selling at a lower price instead.

Or maybe as a result of reading this article, you will choose one of the “good” Realtors in the first place. They are out there, you know.

Posted in: Sell Your Home
Tags: agent, home selling, overpricing, Real estate, realtor