Can You Haggle with Your Real Estate Agent Over Their Fee?

The short answer is yes, you can negotiate the commission you pay for your real estate agent to sell your home. As a matter of fact, Consumer Reports conducted a survey recently of sellers.

It's findings may surprise you, but it may help you too when you go to sell your next home.

Survey findings:

1. Only 46 percent of sellers surveyed tried to negotiate the fee with their real estate agents
2. 71 percent of sellers who negotiated commission rates with their agents were successful

The moral of the story is you won't know if you can pay a lower fee if you don't try to negotiate a lower fee.

What about the quality of service?
Sellers reported there wasn't much of a difference in service because they paid a higher or lower fee. Even real estate agents admitted they are willing to negotiate their fee, especially if the home is in good condition and listed at a price point aggressive enough to sell it quicker. The less time and marketing money the agent has to spend on the deal, the more willing they are to accept less of a commission.

What do you have to lose? The worst they can say is no, so don't accept any commission rate. See if there is any wiggle room. It can say you thousands of dollars and all it costs you is one little question.

5 Tips for a Successful Seller Finance Process

Now that you have decided seller financing is the best way for you to go to sell your home, what do you do now? If done right, the seller financing process can be completed quickly, easily and safely. Use these five tips as a guide to make your seller financing experience as easy as possible.

1. Get professional help. Even though you are cutting out the lending institution, there are still other professionals you'll need during the seller financing process. The seller and buyer may each need a real estate attorney or agent to draw up the sale contract and promissory note and any other legal documents required for the transaction. You may also want to speak to and work with a tax or financial advisor about the taxes reported and paid on the property.


2. Obtain a loan application from the borrower. One of the first things you need to do to start the process is to get the borrower to complete a loan application. Similar to a bank or mortgage lender, you'll use the information provided on the application to run a credit check, verify employment, confirm bank and brokerage accounts, and check references.

3. Make it contingent. Hiring an attorney to draw up the contract ensures all of these points are covered, but if you use a standard contract or create the contract on your own, make sure you put a financial contingency in the agreement. This means that you as the seller have to approve the buyer's finances before agreeing to the seller financing arrangement. The agreement also spells out the terms and conditions including the loan amount, interest rate and term of the mortgage.

4. Make sure it's a secured loan. It's imperative that the agreement also spells out that the mortgage is secured by the property. This protects you in case the borrower defaults on the loan because it entitles you to foreclose on the home to recoup your costs.

5. Require a down payment. Make sure to get some kind of a down payment from the borrower. The reason for this is twofold. First, it provides you with a cushion against the risk of losing your investment. Second, it creates a vested interest in the property for the buyer--making it less likely that they'll walk away from the deal. It is suggested that you obtain at least 10 percent of the purchase price in the form of a down payment.

When done right, the seller financing process can be completed quickly and easily. Stick to these five tips and you'll ensure that your seller financing experience is as easy as possible.

3 Seller Financing Options

In an effort to sell their homes faster and easier in this faltering economy and strict lending environment, many home sellers are offering buyers seller financing. This is where the seller holds the mortgage on the property and the buyer pays the seller a monthly mortgage payment with interest. In essence, the seller acts similar to the bank or lending institution. It's helping more and more buyers and sellers to come together to combat what has proven to be a tough market.

If this interests you as a buyer or a seller, here are three financing options to choose from.

1. All-inclusive
The all-inclusive option permits the buyer to buy the home with as little money out of pocket as possible. The seller may or may not require a cash down payment from the buyer, but whatever the arrangement, the seller holds a promissory note on the property for the entire mortgage amount (less any down payment made by the buyer).

2. Second or junior mortgage
Another option for overcoming the strict lending guidelines of typical mortgage lenders is for the seller to hold a second or junior mortgage for the amount that a buyer would normally put as a down payment (approximately 20% of the purchase price). This bridges the gap in what the lender will loan on the property and the purchase price of the property. While there is a risk to the seller for any seller financing option, this option is a bit riskier because the seller is at a lower priority to be paid if the buyer defaults for any reason. The advantage to this type of seller financing is you receive the funds paid for by the first mortgage at the time of financing so you're only holding a note for the difference rather than the whole purchase price.

3. Land contract
This option doesn't sign the title of the property over to the buyer. Instead, the buyer makes payments to the seller and the buyer and the seller share title on the property. This is also known as "equitable title." When the buyer pays the property off, the seller signs over the deed of the property to the buyer.

Seller financing offers creative options for buyers to buy homes and sellers to sell homes in a tough economy. These situations are also used to make it easier on the buyer. If you're having a hard time selling your home, come up with creative ways to move the transaction along. Seller financing may the answer to your home selling problem.

Seller Financing: Is it the Way to Go to Sell Your Home?

Seller financing is just like it sounds. As the seller, you hold the note or the mortgage on the property (so you're like the bank) and the buyer pays the monthly mortgage payment to you. In today's tumultuous real estate marketing and lending environment, seller financing is making a comeback in popularity because it can benefit both the seller and the buyer.

How seller financing works
The thought of financing a property strikes fear in the heart of 90 percent of sellers because only about 10 percent use it as an option to sell their home. It is a selling point that can help you sell the property faster and easier. With stringent lending guidelines, borrowers that may have trouble finding a mortgage lender can turn to seller financing as an option.

It's all done as a legal transaction, so you'll need to have a professional contract agreement and promissory note drawn up and signed by you and the buyer. All of the terms and conditions of the loan are spelled out and agreed to by both parties and the mortgage is recorded in the county records. So far, everything is the same as if you're the bank lending the money to the buyer to purchase the home you're selling.

Where it becomes different is the terms and conditions of the loan. Seller financing typically has a shorter term than a bank loan. A seller financed mortgage may have payments amortized over 30 years, but it works more like a balloon mortgage because at the end of five years, the note becomes due. Seller financing usually works best when the seller doesn't have an existing mortgage on the property. Sellers that have a mortgage on the property have to get approval from their existing lender before seller financing is an option.

Is seller financing an option for you? It depends on your personal financial situation and needs. If you can delay receiving the total sales price at one time (or what's left after paying off your existing mortgage on the property) and it helps to sell the home faster, seller financing could be the way to go. Today's turbulent times are making it harder for some buyers to obtain the financing they need to buy your home, so it is something to at least consider.

3 Ways to Sell Your Home Faster

With a simple case of supply and demand, thousands of homeowners around the country are struggling to sell their homes. With a shortage of buyers and a flooded market, there is no doubt that it's a buyer's market. So how can you attract the buyers to buy your home instead of the multitude of other homes available in your area?

There are ways you can make your deal more attractive. Take one or all three of these steps to make your house more attractive to buyers and sell your home faster.

1. Pay some or all of the buyer's closing costs. Many of the buyers in the market have enough money for a down payment but may be struggling to cover the other costs involved in buying a home. Since closing costs can mean thousands of dollars in extra expense, offer to pick up the closing costs for the buyer. This widens your pool of buyers because those who could not afford to buy your house now may be able to easily afford it.

2. Offer something for nothing. If you have furniture, fixtures or window dressings you want to leave behind, throw them in the deal for free. It adds value to the purchase price without adding any extra cost. For example, my parents recently bought a home with a fully equipped gym. The sellers did not want deal with the hassle of moving the gym equipment to their new home, so they asked my parents if they were interested in it. Thousands of dollars of gym equipment sweetened the deal--all for free!

3. Buy a home warranty. Home warranties cost approximately $400, depending on the coverage options. This gives the buyer some peace of mind because it covers replacing or repairing major appliances, plumbing, electrical or heating and air systems within the first year the new owner is in the property.

In a buyer's market, you may have to come up with some creative ways to sell your home faster and easier than your competition. The more attractive you can make your sale look, the better off you'll be in the long run.

Credit Repair Companies: Friend or Foe?

With an increase in credit problems flying around the country, opportunists have seen the benefit of opening credit repair businesses. These credit repair companies charge upfront fees, usually ranging from $1,400 to more than $2,000, to scrub credit reports clean of bad credit, bankruptcies, late payments and more.

First, it's ironic that people with bad credit--usually due to lack of or non-payment of their debts--would have a couple thousand dollars to repair their credit. Whatever the situation, those that have paid the upfront fees to credit repair companies have been left holding the bag. They lost their upfront fee and still have all of the negative credit items showing on their credit report that they originally had.

The Federal Trade Commission (FTC) reports a 50 percent increase in complaints filed by consumers of credit repair scams. They also report that they have not found a legitimate credit repair company yet.

The fact of the matter is that anything the credit repair company can do, you can do for yourself--and all it costs you is a little bit of your time. Find out how to you can make yourself look credit worthy in Credit Scrutiny: What You Can Do to Make Yourself Look Worthy to Creditors

6 Ways to Benefit in a Struggling Economy

You're bombarded by the bad news of the economic turmoil every time you turn on the news, open a newspaper or read a magazine. Everything you see paints a bleak and scary financial picture. There is a silver lining though. While some businesses are closing their doors forever, other businesses are doing better than ever before.

If you're considering starting a new business or looking to make a career change, you may want to check out one or more of these industries. While other businesses are faltering, these six industries are soaring.

Beauty schools
When you look good, you feel good. During tough economic times, people are looking for ways to feel better. Second, people look for ways to keep up their looks in a less expensive. Beauty and cosmetology schools answer both of these needs. It allows customers to find a place to help them look and feel good at a lower cost than typical hair, nail and skin salons. There is no doubt that these schools are seeing an increase in customers.

Shoe repair shops
Tough times have less people buying new items and more people trying to fix what they have. Instead of splurging on a new pair of Gucci or Ferragamo shoes, shoe repair shops around the country are reporting an increase in their business. It is more cost effective to repair the shoes and make them look like new than it is to buy a new pair.


Car service and repair shops
The same line of thought holds true with the cars and trucks we're driving. People are making repairs to their autos and keeping up the maintenance on their vehicles rather than buying the latest model. Oil change shops, mechanics, transmission services and muffler shops have all seen an increase in business since the economy has gone into a downward spiral.

Thrift shops
It only makes sense that consignment stores, thrift stores and second hand stores are also doing a booming business. These stores hold hidden gems, where shoppers can snag name brand goods for a fraction of the cost. Even those looking to cut costs on clothing, household goods, shoes and other items are scouring thrift stores to fill their needs and to help them save money at the same time.

Pawnshops
In hard economic times, people are not only looking to save money, but they are also looking for ways to make money. For some, what used to be the last resort is now their only option--pawnshops. People are pawning their prized possessions to cover household expenses and necessities because of job layoffs and in an effort to make ends meet.


Yoga studios
Economic turmoil adds to the stress that we already carry in our daily lives. This is great news for stress relieving businesses such as yoga studios, massage parlors and spas. While you think people would think of these as added expenses, tough times actually cause people to return to themselves. This means any product or service that helps relieve their stress and feel OK on the inside, even if everything on the outside is going down in flames, is a big seller right now.

Don't let the bad news flying around get you down. There is always a silver lining to the bad that happens in the world. These businesses have benefited from the situation and you can too. Whether you're thinking about opening a new business or looking for a new job, here are six areas you may want to check out.

Mortgages & Mortgage Rates

Earlier today I came across a blog post titled, "Complete Guide to Mortgage Rates." If you have been following me for any length of time, you know why this title would intrigue me. I lived and breathed mortgages for over six years during my credit career with Merrill Lynch, Bayview Financial and a small real estate attorney and title company I worked for. Since I am still very much involved in the mortgage industry because I write for it, I clicked on the link to see what wisdom the author had to share.

I don't know about you, but when I read the word "complete," that is exactly what I expect. Boy was I disappointed. This "complete guide" turned out to be a five paragraph blog post. I have to ask the question, "How is this complete?" It is not possible to cover everything a consumer needs to know about mortgage interest rates in five paragraphs! Needless to say, it was far from being a complete guide to mortgage rates and it frightens me that people who may not know how much is missing from the "complete guide" may read it and think this is all they need to know.

If a "complete guide" is only five paragraphs, beware of the information it contains.

50 Ways to Cut Back Expenses

Tough times require cost cutting measures. There are ways you can cut back on your expenses without giving up on living your life to the fullest.

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3 Ways You Can Save on Your Mortgage

Qualifying for a mortgage these days can feel like going into battle. What was once considered a high credit score is now considered low, which means higher interest rates and not so favorable terms and conditions. There are ways you can save on your mortgage and three of these secrets are unveiled here.


1. Ramp up your credit worthiness
Your credit history and credit score are the two main things that lenders look at these days. With all of the turmoil in the mortgage industry, lenders are being very picky about who they will and will not loan money to. This means you have to keep your credit history clean and your credit score high. The higher your credit score, the lower your interest rate, the lower your down payment, and the more affordable your payments. You can learn more about how to make yourself credit worthy in Credit Scrutiny: What You Can Do to Make Yourself Look Worthy to Creditors.

2. Avoid origination fees and discount points
Origination fees and discount points are fees charged by the lender to buy down your interest rate. It may sound like a sweet deal since you get a lower interest rate, but each point you pay costs you 1 percent of your loan amount. If you do the math, it's not usually worth the thousands of dollars it costs for an interest rate that's one eighth or a quarter of a point lower. Situations do vary, but it's usually wise to stay clear of paying points as part of your closing costs.

3. Shop around
Getting a mortgage is a major financial decision--one you shouldn't take lightly. Comparison shopping is imperative to make sure you're getting the best deal possible. Compare at least three mortgage lenders before choosing the one that is right for you. And be sure to compare apples to apples by comparing closing costs and interest rates for each option. For a true comparison, compare the annual percentage rates (APR) instead. The APR is the annualized cost of credit that includes the interest rate and closing costs. The lender with the lowest APR is costing you less than the other lenders--even if the interest rate is higher.

Even in this tough lending market, you can still save on your mortgage. Make yourself credit worthy, avoid costs you don't need to pay and shop around. Implement these three tactics in your next mortgage and you'll save time and money.

How to Pay for an Emergency When You Don't Have Savings

It happens. The car breaks down, a pipe bursts in the house or your child makes an unexpected and uncovered trip to the emergency room. We all have emergencies that pop up. If you have a cushion in savings then it may be a small blip in your financial picture. If you don't have savings, however, it may be a scramble to figure out how you're going to make ends meet.


3 ways to help create emergency coverage--fast

1. Cut back and cut out. There are bills that have to be paid and money that has to be spent, no matter what your financial situation is. Then there are those expenses and bills that are not necessities. Redirect your splurge fund toward covering the emergency. It's amazing how quickly money that once covered eating out and cable bills adds up to enough to get the car fixed or pay an unexpected medical bill.

2. Beg and borrow. If you have family or friends you can turn to, borrow the money from them. Set up a repayment plan and put it in writing so there aren't any problems later.

3. Barter and trade services. If you provide a service or have a talent, try bartering and trading your services for the service you are need of. House needs a new roof and you own your own bookkeeping service? See if you can shave off the cost of the roof repair or cover the whole thing by providing bookkeeping services to the roofer.

It may be an emergency, but there is no need to panic. Stay calm and review all of your choices for raising the funds you need. Use these three ways to cover the cost, or come up with creative financing options of your own.