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Friday, May 6, 2016

How to Handle Appraisal Issues

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On average, about 1 in 10 real estate transactions will have an appraisal that does not meet the home’s market value. That can be a messy situation when you have certain deadlines and contingencies involved. Luckily, there are a few options for buyers and sellers in this situation.

It’s important to know there’s not an exact science for appraisals. You can hire 10 different appraisers and get a 10% to 15% difference in value on either end of the spectrum. The appraisal is only another person’s opinion of your property’s value, anyway.

A buyer will pay true market value for your home. However, a bank can’t lend on whatever a buyer is willing to pay. The bank needs some way to protect itself in the instance a buyer defaults on the loan and can not make the payments. Appraisers are hired mainly to protect the bank.
Here’s an example of an appraisal gone wrong.  A few weeks ago, an appraiser valued a property much lower than the actual market value should have been according to the comparable homes in the neighborhood. The appraiser was from Dallas and trying to appraise a property in the Austin area. That doesn’t make any sense, does it?

   "True market value is what a buyer is willing to pay."

There were plenty of comps in the neighborhood and he used comps outside the neighborhood. In this case, the buyers had to switch lenders and get a new appraisal done. There are other options if something similar happens to you.

As a buyer, depending on the loan, you can make up the difference, renegotiate with the seller, or terminate the contract. On the seller side, you can’t terminate the contract. However, you can negotiate or drop the purchase price down to the appraised value. You can also decide to proceed with the agreed upon price.

Sometimes we can get the appraiser to correct the report if something is blatantly wrong. Other times, the appraiser won't admit a mistake. I’ve seen an appraiser not include the value of a pool on the property. That’s a lot of money that went unaccounted for. Sometimes, the bank will reject a report that is obviously wrong, but more often than not, they’ll go ahead and accept the appraisal.

There are some things we can do up-front to prevent any appraisal issues, so give us a call if you’re concerned about appraisal issues or if you have any other questions. We would be happy to help you!

Wednesday, November 25, 2015

The Key to Presenting Your Home in Its Best Light

Buying an Austin HomeSearch all Homes for Sale
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You may think that the first showing takes place the moment a buyer pulls in to your driveway, but this isn't the case. The first showing takes place on the Internet, which is where the majority of home buyers begin their home search.


The quality and effectiveness of your photos online is absolutely crucial when listing your home. The first thing you need to do is get your home show-ready. We help our clients do this by sending out a professional home stager and designer. The stager will make the home look its absolute best!
Once the home is looking fantastic, we send out a professional real estate photographer. They will ensure your home looks as best as it possibly can in the photos that are eventually posted online.

If you follow these two steps, you shouldn't have too much trouble attracting buyers to your home. If you have any questions about getting your home ready for the market, or if you would like our assistance, please don't hesitate to reach out to us. We would love to hear from you!

Wednesday, November 4, 2015

How to Get Your Offer Accepted

Buying an Austin HomeSearch all Homes for Sale

Selling an Austin Home? Check out our FREE Home Value Report

Since Austin is one of the most competitive buyer environments in the country, it's quite common to see multiple contracts offered on a single property. This can make life stressful for buyers, who find themselves forced to bring their highest and best offers to the table in order to win a multiple offer situation. Today, we want to share a few tips to ensure you don't miss out on the home of your dreams.

The first and most important thing is to be ready to submit an offer. In Austin, if you do not have a pre-approval or a funds verification letter to prove you have cash in hand to purchase, a seller will not acknowledge your offer, much less consider accepting it. Having your pre-approval letter in hand while aggressively looking for a home is the most important thing you can do when buying in Austin.

If you find yourself in a multiple offer situation, upping the option money is something that can sweeten the deal for the seller. When you do this, option money is given to the seller upfront for what we call the option period; often, for seven days it's $150, but making it $500-$1,000 can make the offer more attractive. Another option is offering a greater amount of earnest money, which is held in escrow once the contract is executed. You will only get that money back if you terminate within the option period or some other outlet in the contract. This allows the sellers to see on paper that you're highly motivated and that you're serious about buying the house and less likely to terminate the contract.

Giving the seller the choice of the closing date is another way to make your offer stand out. If you're not in a situation where you need to move into a home in the next 30 days as soon as the loan is process, it will benefit you to be flexible with your timetables. Let the seller choose their close date, or if the seller prefers, close as soon as possible.

Writing a personal letter to the seller is a great way to grab their attention. Explain what you love about the home, why you're moving, where you're from, and what you plan to do with the home. This humanizes your offer, as you become more than just a name on a piece of paper.

Lastly, you need to be patient when buying in a competitive market. Ultimately, in this market, everything is in the seller's hands. Submit the strongest offer you can and relax the best you can; pestering the seller's agent is only going to make you look anxious and desperate, two qualities you don't want sellers to pick up on.

If you have any questions about making the most of this competitive marketplace, please don't hesitate to contact us. We would love to help you find success in this difficult buying environment!