Sellers Sweeten the deal to attract Buyers

Need to give buyers some extra incentive to choose your listing over the large inventories of others? Sure, price will get their attention, but some incentives may be the extra motivation needed to get the deal to the closing table.

Here are a few common extras that are growing in real estate transactions.

Home Warranties
Home warranties, which can cover the repair or replacement of many home system appliances and components (such as air conditioner, water heaters, and more), can provide buyers with some extra confidence when purchasing a home. “Home warranties are appealing to buyers because they cover appliances and system components that a new home owner has no familiarity with,” says Lelia Chapman, vice president of field sales for American Home Shield. “Sellers benefit from offering a home warranty because it sets the home apart from the rest of the competition in today’s saturated market, often leading to faster sales at better prices.”

Seller financing
With tight credit nowadays making it difficult for some to get a loan, some sellers may even offer financing to get a deal closed. Seller financing, in which the seller is willing to hold the loan, has become more common. Seller-financing is generally offered at a higher rate that is capped at a few years and then requires the buyer to pay off the loan or find new financing. (Read more.)

Furniture
Furniture can be costly to move anyway so more sellers are offering some of their furnishings to sweeten home deals too. For example, if sellers are moving to a condo, in which lawn care is no longer their responsibility, throwing in that riding lawn mower may just be the extra incentive a buyer needs. Some home sellers also may even offer to sell some of the furniture to the buyer at a discounted price to earn a few extra bucks.

Creative offers
Some home sellers are getting more extravagant and creative with the incentives they are offering to buyers. Some have even offered a week’s vacation in Hawaii or thrown in a time-share ownership, which they wanted to unload anyway.

Source: “5 Ways to Sweeten a Home Sale,” AOL Real Estate News (June 29, 2011)

5 Questions to Ask When Evaluating Short Sales

“Mortgage lenders across America are eager to avoid foreclosures, and short sales can be an attractive option for clients and real estate professionals alike,” writes Bill Ervin, the national sales director of real estate relationships for CitiMortgage Inc., in an article at RISMedia. “Ask the right questions and you’ll be well on your way to a successful short sale.”

Here are some questions Ervin points out are important for real estate professionals to consider when evaluating a potential short sale for a client.

1. Who owns the lien according to the servicer?

2. What documents are required? For example, the transaction always requires a Letter of Authorization (which is from the client authorizing the real estate professional to speak on their account); listing agreement; purchase contract; estimated/final HUD Settlement Statement; and 2nd Lien Approval Letter.

3. Do all of the parties agree on the property’s value?

4. Has the seller signed a short sale agreement?

5. What are the major challenges the client may face in this transaction? (For example, are there subordinate lien holders or will the client be able to secure financing in time?)

Read more of Ervin’s tips for successful short sale transactions at RISMedia.

Source: “Don’t Fall Short: Follow This Path to Successful Short Sales,” RISMedia (June 29, 2011)