|Top Ten Realtor Mistakes|
1. Poor, incomplete or late / last-minute communication with title company, buyers/sellers, other realtors. Not telling title company in advance about:
a. A buyer/seller who must be absent from closing – coordinating a remote close is time consuming but easily done with enough time;
b. Need for a POA – seller POA is much easier, but a borrower POA must be approved by the lender in advance.
c. That the seller is deceased or an estate or trust is involved. There is NO way for title co. to know that a seller has died. All we see in our title search is their name on the deed when they bought the subject property. This fact could result in a multi-week delay if a seller died without a will, or if the will does not give the specific power to sell real estate to the executor, etc.
d. That the buyer/seller just changed marital status. Affects deed language, AND who must attend closing. In KY all spouses MUST attend a closing of a purchase or refinance EVEN if they are not on the deed of the house…(except for a cash purchase – in this case only one buyer is needed even if married.) E
e. Ugly divorce situation: As long as they are still legally married at time of closing, both selling spouses must sign all sale documents – we will smoothly accommodate them at different times/rooms if needed.
f. Short-sale; Bank-owned; Relocation comapny
2. Including personal property on the contract as part of the sales price. Most lenders do not allow it, especially not on FHA or KY Housing loans.
3. Scheduling a closing: The lender drives the bus for date of closing, not the realtor, meaning a loan can not close until the lender issues final approval for a buyer. So, when an eager realtor “sets” a closing date and tells the clients so, half the time this is simply setting yourself up for failure and the needless upsetting your buyer/seller adding to unhappiness that is avoidable and unnecessary.
4. Setting unrealistic expectations for their clients. There WILL be bumps in the road, and both the realtors and their clients need to be prepared to deal with them without getting too upset when they occur. Price negotiation. Loan approval due to the new landscape – that ALL lenders must abide by new strict and comprehensive rules to verify all facets of a borrower’s credit worthiness, sometimes in seemingly excruciating, redundant detail.
5. Putting off bad news to anyone, mainly to their clients. The only thing that is worse than bad news, is bad news later.
6. Making mountains out of molehills. The sign of a true professional is one who can keep a deal together by smoothing things out and finding compromise. One who knows how to guide their clients, and be firm with the clients when they need to be, is priceless. Buying/Selling a home is tremendously emotional, and, without guidance, buyers/sellers unchecked emotions can kill a deal faster than two shakes of a lamb’s tail.
7. Complaining to their clients or to service providers about reasonable fees charged by other service providers involved in the transaction. Especially at the closing table – This is exceptionally unprofessional.
8. Not bringing the original termite inspection to the closing table – required for FHA/VA loans. Forgetting to bring the good faith deposit check to closing.
9. Not thoroughly reviewing the HUD when it is sent to you for approval – not only the commission, but all numbers.
10. Forgetting that the title company can not complete a HUD until the lender first sends the title co. the Closing Instructions (CI).
a. The CI has all the loan numbers, fees & loan-structure restrictions needed to prepare the lion’s share of the HUD.
b. Once the title co receives this set of instructions THEN the title co. is on the clock, and can complete the HUD and send it to the lender for approval.
c. Only after lender approval, will the lender send the loan documents to the title co. to be reviewed, printed, then copied for closing.
d. After lender approval, then we send the HUD out to realtors/etc. Why? Because when a prelim HUD is sent out, it often results in realtors, buyers & sellers forgetting the words “preliminary” or “not final” or “not lender approved” and forgetting that it was clearly communiacated that it is “subject to change”, and false expectations are set. Realtors, buyers & sellers often become upset when the inevitable changes are then made. Changes are made by the lender or the loan officer at least half the time before HUDs are sent to realtors.