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Why shouldn't I ask the listing agent for help?

5/17/2014

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One of the the biggest (and most persistent) myths in Real Estate is that home buyers will get a better deal when buying the house directly through the listing agent. Try as I might, I just cannot figure out the reasoning behind it!

Silver Spring, MD Buyer FAQ: Why shouldn't I just ask the listing agent to help me?

The listing agent is the seller's agent and as such he/she has a fiduciary duty to the seller. Any information that you, the buyer, disclose to the listing agent can and will be used against you in negotiations. Buying a home through the listing agent will not put you in a better negotiation position and will not save you money.

It is the listing agent's job to get the highest and best price for the property. Why would they assist you in getting the most bang for your buck? They won't and they can't.

In Maryland a REALTOR® can only represent one side, either the seller or the buyer but never both. The broker of a company can act as a dual agent and designate agents for either side. The listing agent can also assist a buyer with submitting an offer but said assistance is very limited.
Which contingencies should you include? The listing agent can't answer that question. Can you prepare a Comparative Market Analysis for me so I know how well (or not) the house is priced? Negative! Is the seller willing to pay my closing costs? No!

When buying a Silver Spring, MD home it is in your best interest to hire a buyer's agent to represent you. You shouldn't ask the listing agent for help because his or her loyalty lies with the seller. Anything you say that could somehow help the seller in negotiations has to be reported to him.

Buying your new Silver Spring, MD home with the help of the listing agent will not get you a better deal and will not save you money. 


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Can I still call you after closing?

5/5/2014

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Can I still call you? asked my client recently after we closed on her new Howard County, MD home.

Why, yes, of course! I will always have time for you!

I have always found closing days to be bitter sweet. Going from frequent meetings, daily texts, emails and phone calls to very little communication takes a bit getting used to. I actually find myself missing that interaction once all is settled and done and keys were exchanged. Maybe we can call it client-withdrawal syndrome  

Of course, she can still call me. In fact, I would love for her to. I want to hear how much she enjoys her new home, the personal touches she added or upgrades she made. I love to see pictures of the improvements in my email in-box, birth announcements, Christmas wishes and phone calls just because.

And if she has any questions in the future, I would be more than happy to answer those, preferably over a cup of coffee. Our buyer-broker-agency may have officially ended but our relationship has not.

Perhaps I have just been incredibly blessed but I do enjoy ongoing relationships with my clients. As a matter of fact, I'm going to meet one of them for dinner this weekend and I can't wait to catch up and find out what's new.

Can I still call you? asked my client. Of course! I would love to hear from you!


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What happens to my earnest money deposit?

2/22/2014

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When you submit an offer on a home in the Silver Spring, MD area it is customary to include a copy of your earnest money deposit check. Just a copy .. your REALTOR® will hold on to the check until you either have a ratified contract or continue looking for your new home.

If the latter is the case, the check will be returned to you promptly. If your negotiations are successful and the Residential Contract of Sale is ratified, your earnest money deposit has to be put into an escrow account within 7 business days of ratification.

More often than not, it's the escrow account of the Real Estate Company your buyer's agent is affiliated with. Sometimes the listing agent requests for it to be put into their broker's escrow account or for it to be held at the title company.

In any case the earnest money deposit will show up as a credit to you on the settlement closing costs sheet. Thus, your cash needed to close will be reduced by the amount of your earnest money deposit.

As a side note, your lender will request a copy of your cancelled check to include in the loan package.

What happens if you never make it to the closing table?

If the contract falls apart then both sides have to sign a release form. Your agent's broker, or listing agent's broker, cannot release the deposit without it.

Should you and the seller not come to an agreement after a home inspection repair request was submitted, or there are appraisal issues or you exercised your right to declare the contract null and void after reviewing (and not agreeing with) the condo or HOA documents, then signing the release form is usually a smooth process (there are always exception to the rules).

However, if you are found (or thought to be) in default of the contract, then it can get more complicated. The seller could claim part or all of your deposit to cover his damages. A signed release agreement in this case would also release you from further liability. If either party refuses to sign and decides to litigate, then the escrow account holder would pay the entire deposit into the court.

Silver Spring, MD Home Buyer FAQ: What happens to my earnest money deposit?

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Can I see the house again before closing?

4/7/2013

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Congratulations! You are under contract to purchase your new Silver Spring, MD home and have successfully completed the home inspection, negotiated repairs and are now sprinting towards closing.

But a lot has to happen still - the appraisal, final loan commitment, title work, termite inspection, utility transfers ... which usually take another 3 - 5 weeks (on average).  One of the questions that I get asked frequently by my Silver Spring, MD home buyers is if they can see the house again before closing. They want to take measurements of the rooms, take more pictures to plan furniture arrangements, perhaps meet with a contractor to get some estimates, show it off to family who is only in town for a few days ...

YES, you will get the chance to see the house one more time before closing. According to the MD Residential Contract of Sale the buyer reserves the right to inspect the property within five days prior to settlement.

This is what we call the final walk through during which we make sure that the property is vacant and free of trash and debris and in the same condition as of the date of contract ratification (or home inspection). We don't want to wait until the last minute to conduct the final walk through but the seller should have moved out completely before we do so.

The final walk through is the one visit to the property that you are guaranteed before closing. Any other visits, however, are at the discretion of the seller, he/she does not have to grant you access for any other reason.

Although more can sometimes be arranged, it is not always possible, and you should plan on taking pictures and measurements when we are at the property for the home inspection or any prior visit.

Silver Spring, MD Home Buying FAQ: Can I see the house again before closing?

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How much should my earnest money deposit be?

3/21/2013

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A: There is no set rule or requirement, the amount of your earnest money deposit typically depends on several factors: what is customary, the buyers finances and what are the market conditions. 

In the Silver Spring, MD area a customary earnest money deposit is about 1%+ of the sales price. A low earnest money deposit can considerably weaken an offer since it doesn't show the seller that the buyer will have any skin in the game.

Just think about it, how serious will the seller think you are if you are making a $100 deposit on a $400,000 house? Yes, I almost had this happen once .. 

It's important to note that the amount of the deposit is written into the Maryland Residential Contract of Sale and only a copy of the check is submitted with the offer.

After contract ratification the check must be deposited into escrow within 7 business days. Silver Spring, MD home buyers will see their earnest deposit as a credit on the settlement sheet.

How much of an earnest money deposit you should make also depends on market conditions however. In a competitive market where buyers far outnumber sellers, a higher earnest money deposit can considerably strengthen your offer and give you a leg up over the competition.

In the Silver Spring, MD seller's market we are currently experiencing buyers got to put their best foot forward when making an offer - a higher than customary earnest money deposit can help you do just that.

Silver Spring, MD Home Buying FAQ: How much should my earnest money deposit be?


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Which Silver Spring School District is a Good One?

8/17/2012

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The good school district is typically high on the wish-list for families with school-aged children looking to buy in Silver Spring, MD - ranking high up there with the good subdivision.

Good, however, is relative - what may be good (enough) for one, may not be good (enough) for another. As a Silver Spring, MD Realtor® I cannot determine for you which area or school meets your definition of good and which one doesn't.

That does not mean, I cannot assist you in your home search and in narrowing down your choices. I will point you to the right resources and I will adjust my search based on your specific criteria.

If you are new to the area or the school topic is a new one for your family, then the following are good starting points:

1. www.greatschools.org: provides information on school performance and rates schools accordingly, it also allows for comments which may or may not be helpful (keep in mind that people are more likely to comment when dissatisfied than happy)

Currently, the following are the top-rated public schools in Silver Spring, MD: Viers Mill Elementary School, Cloverly Elementary School, Forest Knolls Elementary School, Takoma Park Middle School and Montgomery Blair High School.

Viers Mill Elementary School is also a Maryland Blue Ribbon School of Excellence having received the award in 2005.

2. The Montgomery County Public School Assignment Locator: If you already have a subdivision in mind or like a specific property, you can check and see which school district it falls into. Just enter the street number and name (do not enter the type) and click on GO:

Once you have identified a specific school district/area we will research the market to make sure it fits your budget and any other criteria that may be high on your wish list (proximity to public transportation for example, or lot size).

I will adjust my search based on your preferred geographic area and make sure the homes we are going to tour fall within it.

Only you can decide which area is the right one for you and which school district meets your standards. It is part of my job to assist you with the right resources and in narrowing down your choices - just one of the many things I do as a Silver Spring Realtor®!

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Do I Really Need A Buyer's Agent?

8/5/2012

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There are literally hundreds of thousands of property sites that allow you to search for your new home online based on your criteria. There is also a ton of how-to and how-not-to advice 'out there' and if you are able to identify the relevant information for you, you might ask yourself "Do I really need a buyer's agent to purchase a home in Maryland?".

Technically, the answer is "No, you don't" but why wouldn't you? Yes, you can house hunt online, you can even arrange to view the homes you are interested in and the listing agent can give you the necessary paperwork. But that is all the assistance you can expect from the listing agent. He/she represents the seller and cannot represent you, too, it is either/or in the State of Maryland.

Wouldn't you want someone to represent you the same way the listing agent is representing the seller?

So, how will a buyer's agent assist you with your Maryland home purchase?

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If you would like to get more detailed information, please keep reading. It is impossible to sum up with 2 sentences however, so please bear with me as I attempt to explain my role as a Maryland Buyer's Agent:

  1. Preparation: I like to take the time for an initial face-to-face meeting. I do believe that in order for your home buying experience to be a pleasant one, we need to "click". If all goes well I need to find out where in the process you are at:

    Do you have a loan pre-approval in hand or are recommendations for trusted loan officers needed? Do you have a clearly defined wish-list or is it still a work in progress? Do you understand the market and the home-buying process? What is your time-frame for moving? ... 

  2. Home Search: Your loan pre-approval is needed to proceed with the next step. There's nothing worse then falling in love with a house that you cannot afford. Based on your price-range and wants and needs we'll start the home search. There are several ways to go about it: you can search online and email me what you find of interest, I can set up a search and email you the listings that fit your criteria. I will schedule the showing appointments and we'll start viewing homes .. I'll point out things to you that you may miss (the water stain on the ceiling, the lack of privacy, the missing ...), we'll review what we've seen and adjust your criteria. Sometimes that process ends after just one trip and sometimes it takes several months. Sometimes it involves a reality check or fine-tuning your wish list ...

    But however short or long it takes to find your new home, I am committed to finding you the perfect match!

  3. Preparing the Offer: As soon as we have found YOUR new home, we'll get busy with all the paperwork that I gave you before for review. I will request the disclosures from the listing agent and I'll pull the comps and assist you with your offering terms. I will make sure all i-s are dotted and t-s are crossed. I will talk (again) to your lender to make sure we allow enough time for appraisal and financing contingencies. I will identify necessary addenda and prepare it for you - depending on what jurisdiction your purchasing in, what loan program you are using and what type of home and sale it is will determine which contract addenda is needed.

  4. Negotiating: It does happen that a seller will just accept the terms you proposed but more often than not, we'll be negotiating. We will discuss beforehand what, if anything, you are willing to compromise on and what your bottom-line is.

    There are different strategies depending on the house, how well it is priced, the owner, you, your motivation and wants & needs, inventory, competition and even the listing agent. Price is not the only term that can be negotiated, there are seller concessions, inclusions and time-frames .. all open to negotiations. The goal is to negotiate the terms you are most comfortable with.

  5. From Contract to Settlement: Congratulations! You are now officially under contract and it's only about 4 - 6 weeks until you will receive the keys to your new home. A lot has to happen during that time frame and it is my responsibility to make sure it all gets done by communicating with all parties involved and staying on top of deadlines, time is of the essence!

    Applicable inspections need to be scheduled and performed, the lender & Title Company will receive a copy of the contract and we will work towards removing all the contingencies:

    there is the home inspection, termite inspection, radon or mold if you opted to get them done, well inspection if applicable, there is the appraisal and financing contingency and title work, too. Repair negotiations may be necessary, an appraisal problem may present itself, there may be a defect on the title ... ideally all goes smoothly but more often then not purchasing a home may seem like climbing a tall mountain. Rest assured if obstacles do turn up I will work towards getting you passed them.

    When all contingencies have been removed and any obstacles have been mastered, we'll hear the magic words Clear to Close! and sprint to the settlement table. We'll take care of the last things that need to get done, transfer of utilities and final walk-thru for example and I will review your HUD 1. I will also attend closing with you, for moral support or in case questions arise and because I love to be the first one to welcome you home!

  6. Your trusted Realtor® for Life: Closing Days are always bittersweet! Please know that although our client-Realtor® relationship has ended, I will still be available for any questions and always love to hear from you!

Hiring your own buyer's agent has tremendous value and it all comes at no cost to you. It is customary in Maryland for the seller to offer a cooperating broker commission which is how buyer's broker & agent get compensated. At Thompson Company Realtors we also do not charge anyone a "transaction processing fee" thus your buyer representation and all that it entails is free to you. 

Are you ready to get your home buying journey started? Then give me a call and we'll schedule a meeting to enter Phase 1!

P.S. You have made it to the end of this very long blog post! Thank you very much for reading ... I look forward to hearing from you,

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