Who you choose can make a big difference
How to Find the Right Pros to Buy or Sell Your Home
by Brandon Ballenger, courtesy of MoneyTalksNews.com
Satisfaction with the nation's largest real estate companies has reached a five-year low.
J.D. Power and Associates' newly released 2012 Home Buyer/Seller Satisfaction Study says, "Overall satisfaction among home buyers (using large national realty companies) is at its lowest level in the (five-year) history of the study, averaging 789 on a 1,000-point scale, compared with 797 in 2011." Seller satisfaction numbers were even lower, at 768.
The survey measures satisfaction with the largest national realty companies in categories including "agent/salesperson, office, and variety of additional services" for buyers, and those plus "marketing" for sellers.
The survey included 2,790 respondents, most of whom have been around the block before. 60 percent were repeat buyers, and 70 percent were repeat sellers. So the decline doesn't look like it necessarily came from a surge in new people on the market.
Instead, the survey says, "The agent/salesperson has the largest impact on overall customer satisfaction among both home buyers and sellers."
How can you make sure you get the right pros? Check out this video where we interviewed an experienced mortgage broker and real estate agent about what to look for. Then read on for details…
The Mortgage Pro
The first person buyers need (unless they're flush with cash) is a mortgage expert. A pro will help you figure out what kind of mortgage you can get based on your credit and offer advice if your credit needs help. They'll also help you decide which type of mortgage best suits your needs (15-year or 30 and adjustable-rate or fixed). Then, they'll walk you through the pre-approval process so you'll be ready to nab that perfect home before someone else does.
A mortgage expert's job is to provide three numbers: the mortgage amount you're able to qualify for, the cash you'll need to close, and the monthly payments you'll ultimately fork over. As mortgage pro Rob Hurst says in the video above, "Once you know and accept those three numbers, you're more comfortable writing a contract" - because you know exactly what you're getting into.
So how do you pick a mortgage pro? Here's Hurst's advice:
- Talk to several. "I would get three good-faith estimates from three different reliable lenders and compare and shop in terms of rates and fees."
- Be wary. "I would ask if there's any upfront fees." Hurst adds that the company he works for doesn't collect anything until the buyer has a contract, and that "anybody who wants a higher-than-normal application fee or up-front fee, I would stay away from them."
- Ask questions. While interest rates and fees are obviously important, so is working with someone experienced. Ask about that. The paperwork involved in closing a mortgage loan can be daunting, and problems aren't uncommon. Someone who's done 1,000 transactions is better than someone who's done 10.
- Get recommendations. Ask your real estate agent to recommend a mortgage pro; they should know who's good. "Let's say there are two that are identical," Hurst says. "If one of those two has a relationship with my agent, that's the one I'd pick."
Of course, recommendations work both ways. A local mortgage professional may be able to help you find a good real estate agent too.
The real estate agent
A real estate agent isn't essential for a buyer or a seller. Owners can deal directly with buyers, and they often do. Many buyers prefer it because that saves them thousands on commissions, which means a potentially lower price.
But a good real estate agent can help in major ways. Real estate agent Denny Grimes says, "A lot can go wrong, from an appraisal issue to a negotiation issue, to an inspection issue… Everything along the way can cost a percent or two, and that adds up."
Having the right person to help buyers find the right house at the right price (or help sellers price and market theirs effectively) may well be worth it. Grimes' advice…
- Ask open-ended questions. Aside from asking about experience and recent transactions (both critical), Grimes says he would quiz the agent with open-ended questions. "I would ask, 'Please give me your evaluation of the market.' If they start to spout headlines versus local data, or they're a little bit uncomfortable with that question, that suggests to me they have not adapted to local market dynamics."
- Focus on qualifications, not personality. Everyone wants to deal with someone they feel comfortable with. But take comfort from winning credentials, not a winning smile. "For a lot of people, it's relationship-based instead of professionally based," Grimes says. "The best agent for you may not be your best friend."
- Request referrals. In addition to asking mortgage pros and agents about each other, get in touch with past customers. The personal feedback, along with the sheer number of referrals they offer, may say something about the agent's experience. "If you're looking for a pedigree, I can provide more satisfied customers than probably any other agent in town," Grimes says. "If you ask for a satisfied customer and they only have one on their list and it happens to be their mom, you might want to look elsewhere."
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