Sunday, January 24, 2010

You Might Not Need A REALTOR IF.... Reason #1

Reason #1: You Might Not Need A REALTOR IF….You’re sellin’ to Aunt Bessie.

If you are selling to a relative, neighbor, friend or even a company that you own, and all major terms have been agreed to, then you may not need a real estate agent, or at least not a full service agent.

There’s no need for marketing and pricing strategy and efforts, or initial negotiation assistance, because in this example, you are not looking to sell for the highest and best price, and you're not worried about protecting your "position" because you trust the person with whom you're doing business, and you simply don't have much at risk anyway. If the sale doesn't go through, you won't be in a bad position.  (Please do make sure all of these things are true in this example, otherwise, it does not apply to you.)

Even so, you still need someone to advise you on the legal requirements for contracts, disclosures and to assist and coordinate contract to close efforts. Depending on the transaction, an attorney may be best or a limited service real estate agent.

If the transaction is technically or legally challenging and is a little more out of the “norm” for the market – like a seller financed deal, or a rent-to-own deal or large land transaction, then an attorney is probably best. They will charge you more but are in a better position to assist you with the legal aspects, and they can likely handle the closing, too.

If the transaction is more traditional in nature – residential property, bank financing with appraisal contingencies, then a hiring a real estate agent would be a better choice. Agents are better trained to deal with this and have resources readily available to deal with financing and appraisal issues that may arise, and a title or settlement company can handle the title and closing process. This combination will also usually cost you less than hiring an attorney.

As a special note, I’ve not seen most limited service agents really know how to deal with “problems” in this area should they arise. They usually work by the hour and really don’t care if the situation gets worked out. They are used to the "other side" having a full service agent and doing the work for both sides. So, I’d try to hire an agent that typically handles full service transactions and ask them to act on a limited service basis. While their fee may be contingent, or a flat fee or hourly, they are used to operating as if their own livelihood is on the line, too, so they’ve developed strategies to deal with “problems”, and have a higher level of expertise and more resources available to them. Doing this is not possible in all states or at all brokerages, so you’d have to ask around.

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Make sure you don't miss any... so stay tuned to THE REAL ESTATE WHISPERER for the rest of the posts in this series.

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