In recent months, real estate has become a popular career change goal for those who left their previous jobs as part of the big resignation. New agents entering their first transactions will need to exhibit a polished demeanor and a value-added approach, while trying to find their place in their new profession.
The procedure for guiding a client through the intricacies of buying a home differs significantly across the country, but here are some basics. Check with your manager for the specifics of your region.
Make sure buyers are pre-approved by a bank
Make sure buyers are not just pre-qualified, but pre-approved. A seller will not look favorably upon a buyer who wishes to finance but whose qualifications have not been verified by a bank.
Help them get a lawyer, if necessary
In some parts of the country, a lawyer is considered essential. In others it is not. If your buyer needs a lawyer, make sure he finds a real estate lawyer and not someone’s brother-in-law who is a personal injury specialist who will do him a favor. If they’re considering buying a co-op or condo, they should have a lawyer read the board minutes and review the financial statements and prospectus — more on that below.
Ask the brokers in your office to recommend lawyers. Give your buyers a list of at least three choices. Tell them to make sure the person they choose doesn’t go on vacation in the next few months.
Prepare buyers to submit a financial statement
This financial statement accompanies the offer in certain regions of the country. It should show assets and liabilities and what the buyer’s cash flow will look like after closing. Also make sure they have funds for the contract deposit, which is negotiable but usually 10-20% of the purchase price.
All of the above should be in place before, or at least by the time you show them properties, so they’ll be ready to move in quickly when you find them their dream home. If a house is perfect for your buyer, chances are it’s just as perfect for someone else’s buyer.
Help buyers do smart searches
You are now ready to start looking for houses or apartments. Don’t show more than five to a buyer at a time or the properties will start to fade. Bring up a map and put a star on the location of anything you’re going to show, to make sure your route makes sense of location.
Try to schedule properties in the same neighborhood on the same day so you can walk from one to the other.
If you’re showing properties that are far apart, you might want a car service or at least an assistant to help you drive so you don’t have to waste time finding a parking spot. It can be expensive, but it will save you time and build customer loyalty. Don’t stand there waiting for a taxi.
If their eyes are bigger than their wallet, plan for at least two or three properties that are within their price range, but also show them what they could get for a few dollars more. You don’t want them to be too depressed at the end of the day.
Help buyers rethink their wishlist, if necessary
If you’ve shown your buyer more than fifteen properties and they’re still not ready to make an offer, it’s time to have a conversation.
Maybe they should consider another place where their money will go further. Maybe they should reconsider their priorities. Is a third bedroom really necessary? Would they consider a house that needs work?
Talk to your broker or mentor before the offer
This is where you should check with your manager to find out exactly what to do next, as the procedure is different from state to state or even city to city. But some things are universal.
I strongly recommend that the buyer or buyers enter the apartment or house at least twice before signing the contract. Your buyers may see that at second glance the light is not as good as they remembered. Or that the place seems to have shrunk.
Find as many recent comparable sales as possible to make sure the property is worth somewhere near the asking price and to help them decide what to offer.
If it’s a co-op or condo, get the building’s most recent financial statements from the seller’s broker or managing agent and check to see if it appears to be in good financial health . (Your manager can help you understand the financials.) The buyer’s attorney will examine the financials under the microscope once the offer is accepted, but you should be able to spot any red flags – litigation. in progress, for example.
Notify the seller’s broker that you will have an offer for him and ask if there are already any on the table. If there are other offers, your buyer should bid as aggressively as their comfort level allows. But even if there isn’t, their offer should probably be at least 90% of the asking price, assuming comparable sales show the price is right.
Compose the offer. In some parts of the country, the buyer’s broker fills in the blanks in a form letter. In other areas, the buyer’s broker generates the letter. In some places, it may be a real contract.
Here is the basic information it should include: the name and address of the buyer, the amount of the offer when they want to close, if they plan to finance and, if applicable, the amount of financing , whether the contract will be conditional on funding and any other contingencies.
It may or may not also include the financial statement the buyer has prepared and the name and contact information of their lawyer.
Know how to prepare for the contract
But that’s only the beginning.
An agreement is the most vulnerable between the accepted offer and the finalization and signing of the contract. If the property is a condo or co-op, make sure the seller’s broker immediately sends the financial statements and prospectus to the buyer’s attorney. (Prospectuses for most properties are now available on the web, so it may not be necessary for the seller’s broker to send one.)
The buyer and his lawyer are now doing their due diligence, i.e. for an apartment, reading the financial statements, the prospectus and going to the manager’s office to read the minutes of the board meetings. ‘administration. If there is to be a home inspection, it should be done right away. In some regions, this period is specifically authorized for this purpose. But the contract must be signed as soon as possible.
Present the buyer’s financing options
If the purchase of an apartment is to be financed, check with the buyer’s bank or mortgage broker to ensure that the bank will finance in the chosen building.
Most banks won’t begin the process of setting up the loan until the contract is fully executed, but you need this information up front in case you need to find another bank. Once the contract is signed, check in with the bank or mortgage broker from time to time to see where they are in the process.
Put together a winning application
Today, condominiums, as well as cooperatives, require complete application kits. They include, among other things, tax returns, personal and professional reference letters, payslips and bank statements. Ask the seller’s broker for a copy of the package so your buyer can start gathering the information.
Then wait for the contract to be signed. Transaction management is a skill that agents will need to constantly hone and practice. Helping your customers get to the closing table requires follow-up, but with careful attention, you can create a professional and seamless experience for them.