Are you preventing your home from selling?

It’s a fact! There are some of you who are preventing your home from selling.

You see, there are actually still some lenders who are lending 100% mortgages at rates as low as 6.25%. hard to believe? Not really. The 10 year bond is at about 3.45 to 3.55%. I track it almost daily. The 10 year is what long term interest rates are based on. So when the 10 year bond is at about 3.50% then you can bet mortgage rates are still ultra low. Do you remember a time when everyone said “mortgage rates are the lowest they’ve been in 40 years?” Well, since then mortgage rates haven’t changed much. Now for the reason  you’re preventing your home from selling….

You’ve priced your home too low!!!!

That’s right too low!

You see, after you find a buyer and you want to increase the price to structure the contract appropriately, it’s tough to increase the price. That’s a fact, especially in THIS market that we’re all experiencing. So you have to be smart about pricing your home. Your “pretender”, oops, I mean PROFESSIONAL REAL ESTATE AGENT, will try to get you to price the home “realistically” so it can sell rather than stay on the market for months. But when she says this she is really doing you wrong. She should be recommending that you INCREASE the asking price. Increasing the asking price does two things.

1. It makes it easier to structure a contract if the buyers have credit dinks or if you need to  include a “decorating allowance” as a concession. In addition, you can also pay a large chunk of closing costs, from 3% to 6% if you already have money built into a higher asking price. As the seller, your net will be very close to the same assuming you build some concession money into the contract. However, because agents generally don’t have the slightest idea of how residential real estate financing works, they don’t tell you about this. Let’s face it….you NEED a real estate agent or broker that understands real estate financing. Not an agent that has an “in house mortgage broker” or a “bank that works with the agents customers” but THE AGENT THEMSELVES must understand finance to be able to work with you!!! I’ll bet you’ve never heard that before but it’s true!!!

2.  The second reason home sellers should increase the asking price of the home is because lenders HATE to see the asking price of the home change AFTER THE CONTRACT IS SIGNED. This was a familiar occurance in the last 5 years. However, the mortgage implosion is showing us the errors that were made and this is one of them.

So there you have two reasons why you, or someone you know, may be preventing a home from selling!

Increase the price to sell your home faster!

Need to check the value of your Home?

Check http://www.zillow.com to check the value.  Just enter your home address or the address of any home and you’ll get a very accurate value that is similar to an appraisal.

I hope this helps someone in forclosure.

That’s it for today!

Talk to you soon!