HOW TO NEGOTIATE WITH SELLERS

If you dread the negotiating process when buying a home, never fear. When you hire a Realtor you will have a partner that is an experienced negotiator who helps keep the bargaining from becoming emotional and veering off track.

Your Realtor must know your desires by heart and have quick access to you if a negotiation point needs to be made. It's important to stick to the strategy you and your agent have agreed upon -- showing the seller how strong your offer is.

First, get pre-approved for a mortgage loan. That means your mortgage lender has reviewed your credit history and assets, checked employment and income, examined your debt-to-income ratios, and has pre-approved you for a certain amount, terms and interest rate so you know exactly how much you can spend.

Being preapproved shows sellers that you are prepared and able to buy. Before you submit an offer, ask your agent to find out more what the seller wants as far as terms. The more your offer matches up with the seller's requests, such as a closing date, the more likely your offer will be accepted.

Find out when the house will be vacated, if any repairs or improvements are planned, and if the seller has any pressure points such as a relocation deadline. Also, you'll want to review the seller's disclosure of the condition of the property.

Your agent must also find out if other offers are on the table. Your position is stronger if there are no other offers. The seller may be less likely to bend on price concessions or repairs if there are other offers.

Have your agent pull up the most recent CMA (comparable homes recently sold or on the market) within a reasonable radius of the home, so you can sculpt your offer price. Be sure that you are comparing apples to apples in terms of updates, size of the home, amenities, location, schools districts, etc.

Once these steps are made, you are ready to write an offer.

Making the offer

Make yourself think like the seller. It helps you anticipate what the seller will accept in price, terms, and other conditions. By considering the seller's position, you will likely create an offer that is either accepted or strongly considered.

Your offer should be clear on the terms, closing dates, repair requests or other conditions the seller needs to meet and it should be accompanied by a letter from your lender that you are preapproved to buy the seller's home. Include a cover letter summarizing your strengths as a buyer in terms of creditworthiness, flexibility in closing, and the strength of the offer.

Don't insult the seller with an offer that's too low or requires too many concessions. The seller may be nostalgic about his or her life in the house and may not like the idea that you want to remodel.

The only thing a seller can't argue with is a strong set of comparables that show the home is overpriced or out of date. These are homes that have sold that are nearby (within two blocks) and similar in age, size and features. If you can show that a similar home has sold within the last two months for less than the seller is asking, that's good.

Be sure all conditions, repairs, etc. are agreed to in writing. Some sellers may feel that a handshake covers a promise, but it's essential to be clear on paper what is expected and when. A seller's promise to paint should be included as an addendum to the contract and include all details, such as primer, exact color and type of paint, how many coats, and when the work will be finished for inspection.

Negotiating after inspections

The offer is negotiated and accepted, the earnest money is at the escrow agent's office. Now the inspections occur, and this is where the contract negotiations can break down.

No home is perfect, not even brand-new construction. During the inspection process, the inspector is usually required to tell you about any condition of appliances, heating and cooling systems, roofs, electrical and plumbing systems, etc, and if your future home is up to current city codes.

Sellers are usually not required to bring a house completely up to current local building codes. Negotiate a repair only when a system is unsafe or a major repair is needed to make the system operate effectively.

As long as the seller has a reasonable explanation of what your position is and why, and communication remains open, the seller should have as much desire to make the contract work as you do.

New State of Michigan Appraisal Management Company Licensing Requirements

New State of Michigan Appraisal Management Company Licensing Requirements

Contact: Melanie Brown 517-373-9280

Agency: Licensing and Regulatory Affairs

May 28, 2014 - On December 27, 2012, Gov. Rick Snyder signed into law House Bill 4975 of 2011 which became PA 505 of 2012, effective April 1, 2014. This new law makes it mandatory for appraisal management companies (AMC) to be licensed in Michigan for the first time. 

Section 2663 of the Occupational Code, MCL 339.2663, provides that a person shall not do any of the following in this state without an AMC license:

•             Directly or indirectly engage or attempt to engage in business as an AMC.

•             Directly or indirectly perform or attempt to perform appraisal management services.

•             Advertise or hold itself out as engaging in or conducting business as an AMC.

•             Use the term “appraisal management company,” “mortgage technology company,” or any similar term that indicates the person is licensed under the Occupational Code.

Currently, the Corporations, Securities and Commercial Licensing Bureau (CSCL) in the Department of Licensing and Regulatory Affairs is reviewing applications and issuing licenses to applicants who meet the AMC licensing requirements, as defined in section 2665 of the Occupational Code, MCL 339.2665.

As of May 27, 2014, CSCL has received 106 applications for licensure and has issued 56 licenses.  If an incomplete application was received, a deficiency notice was sent to the applicant.  Since this law went into effect, there have been no complaints and there are no open investigations regarding AMCs.

An application for licensure may be downloaded from the www.michigan.gov/amc website by clicking on “Forms and Publications” on the right-hand side.  The fee for a three-year license is $2,000.00.

For more information about LARA, please visit www.michigan.gov/lara

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4400 W. WALTON BLVD

WATERFORD, MI 48329

248-674-4080

10 WAYS TO GET THE HOME YOU WANT

Rates may soon rising, banks are still operating under tight lending conditions, inventory is shrinking, and competition for well-priced homes, especially in the first-time buyer range, is fierce. Are you being shut out of the real estate market?

With some advise from Real Estate at MSN.com,  here are 10 ways to improve your chances of getting in the market and getting the home you want.

1. Know what to expect from the process

No two real estate transactions are exactly the same, but buyers who have an idea of how things work will have a leg up. "Buying your first home is one of the most important decisions of your life," said MSN. "Yet most people lack in-depth knowledge of the process." Working with an agent you can trust is key. And while you might be tempted to use the lady down the street who just got her license or your brother-in-law's cousin's stepbrother, your best bet is to ask for referrals from your core group and interview a few. After all, there are hundreds of thousands of dollars and the American dream at stake.

2. Know the market

In real estate, things can change quickly. Make sure you keep up on what's happening with mortgage rates as well as home sales and prices in your target neighborhood. You'll also want to know if any homes are in default - this will shed some light on neighborhood stability, and may also uncover a great real estate deal for you.

3. Know your neighborhood

That abandoned house on the corner might be a great deal, but as for neighborhood charm…well, how do you feel about a real-life Breaking Bad situation going on across the street? You don't want to end up on the news as a witness to a drive by, so make sure you consider more than price when narrowing down neighborhoods. How are the schools? Great Schools can give you some insight, but you'll also to simply ask those who live in the area. If you don't know anyone, reaching out to your contacts through social media is a good way to make use of your extended network. You'll also want info on area crime rates, which your agent should be able to provide. The local police department can also give you some information. Finally, you'll want to check registered sex offenders in the area, which you can do on a site like Family Watchdog.

4. Know your credit score

Minimum scores needed to qualify for a mortgage vary depending on the type of loan, the lender, the going rates, the amount of money you are putting down…it's a complicated equation your lender can help explain. For an FHA loan, which is what many first-time buyers use because of the more relaxed requirements, buyers typically need a "minimum FICO score of 580 to qualify for the low down payment advantage, which is currently at around 3.5 percent," said FHA. Buyers should know that a score that low in combination with the minimum down payment may result in a more complicated loan approval process and a higher rate. And "borrowers need, in general for a conventional mortgage, a minimum FICO score of about 650,. Remember, the higher your credit score, the lower your mortgage interest rate will be.

5. Know how much it really costs to buy a house

Down payments are one thing. Have you factored in any upfront fees you are expected to pay? Your earnest moneyrequired to show the seller good faith? How about your closing costs? These will vary depending on your lender and your loan, but closing costs are usually between three and five percent of your loan amount, which can be a hefty and sometimes unexpected output of cash on top of everything else you just paid. For a detailed breakdown of FHA closing costs, click here.

6. Know how much you can afford

And stick to it, even if it's tough to find a house you like. Busting your budget won't pay off in the end if it's a constant struggle to keep up with your mortgage payments. "The rule of thumb is that you can buy housing that runs about two-and-one-half times your annual salary," said CNN Money. "But you'll do better to use one of many calculators available online to get a better handle on how your income, debts, and expenses affect what you can afford."

7. Know how monthly payments really work

About those calculators…many real estate sites and online calculators calculate principal and interest only, but as a homeowner, you will also pay insurance and taxes. If you put less than 20 percent down, you will also have to add in private mortgage insurance. And if you are in a planned community, you need to account for homeowners association (HOA) dues as well. Make sure you ask your agent about HOA fees, and ask your lender to do a calculation including everything you will pay on a monthly basis. You can also try this one.

8. Know how to win friends and influence people

Nothing tests the patience like losing out on the home you've fallen in love with (unless it's losing out on 2 or 3 or 10 - hey, it's tough out there for a first-time buyer.)  A good agent should be able to reach out to his or her network to potentially find you a home that is not currently on the market or help you stand apart. But you can also take it into your own hands! Try a little tenderness, and you just might get ahead. After all, not EVERYTHING is about the bottom line. "To stand out from the pack, an increasing number of buyers are taking the old-fashioned approach and penning a love letter to sellers telling them what they adore about the house and why they are the best suitor to end up with it," said MSN. Sometimes, all it takes is a little something extra to take you from frustrated homebuyer to happy homeowner, and making a personal connection with a seller who may be overwhelmed with offers can only help.

9. Know how to play hardball

Is somebody who's working for you under performing instead of over-delivering? Go back to that whole "working for you" thing. If you remember that your realtor, your lender, and your title company are all there to help you - but they're being paid to do so - it'll be easier to have a tough conversation if and when necessary.

10. Know when to cut and run - and how

An inexperienced, overly busy/inattentive, unethical or abusive agent or lender can turn what should be a joyous experience into a disaster. If you reach the point where it's time to move on, heed this advice from MSN: "Once you're ready to break up with your agent, make sure you have this dissolution in writing. That protects you from paying unnecessary commission and keeps the agent from continuing to work on your behalf after you've moved on. Make sure you have the agent revise a contract of representation if you signed one to make it clear that the relationship has been cancelled." 

FIVE THINGS YOU SHOULD KNOW ABOUT HOME INSPECTIONS

If you're hiring someone to inspect the home you want to buy, or you're a seller trying to find out if there are any

hidden problems that need fixing before you put your home on the market, here are five things you need to know:

1. You can choose your home inspector.

Your real estate professional can recommend an inspector, or you can find one on your own. Members of the National Association of Home Inspectors, Inc. (NAHI), must complete an approved home inspector training program, demonstrate experience and competence as a home inspector, complete a written exam, and adhere to the NAHI Standards of Practice and Code of Ethics.

2. Home inspections are intended to point out adverse conditions, not cosmetic flaws.

You should attend the inspection and follow the inspector throughout the inspection so you can learn what's important and what's not. No house is perfect and an inspection on any home is bound to uncover faults. A home inspector will point out conditions that need repair and/or potential safety-related concerns relating to the home. They won't comment on cosmetic items if they don't impair the integrity of the home. They also do not do destructive testing.

3. Home inspection reports include only the basics.

A home inspector considers hundreds of items during an average inspection. The home inspection should include the home's exterior, steps, porches, decks, chimneys, roof, windows, and doors. Inside, they will look at attics, electrical components, plumbing, central heating and air conditioning, basement/crawlspaces, and garages.

They report on the working order of items such as faucets to see if they leak, or garage doors to see if they close properly. Inspectors may point out termite damage and suggest that you get a separate pest inspection. The final written report should be concise and easy to understand.

4. Home inspectors work for the party who is paying the fee.

The NAHI Standards of Practice and Code of Ethics clearly state that members act as an unbiased third party to the real estate transaction and "will discharge the Inspector's duties with integrity and fidelity to the client." A reputable home inspector will not conduct a home inspection or prepare a home inspection report if his or her fee is contingent on untruthful conclusions.

The inspector should maintain client confidentiality and keep all report findings private, unless required by court order. That means it is your choice whether or not to share the report with others. If you're a seller, you don't have to disclose the report to buyers, but you must disclose any failure in the systems or integrity of your home.

5. Inspectors are not responsible for the condition of the home.

Inspectors don't go behind walls or under flooring, so it's possible that a serious problem can be overlooked. Keep in mind that inspectors are not party to the sales transaction, so if you buy a home where an expensive problem surfaces after the sale, you won't be able to make the inspector liable or get the inspector to pay for the damage. In fact, you may not be entitled to any compensation beyond the cost of the inspection.

As a buyer, you need the home inspection to decide if the home is in condition that you can tolerate. You can use the report to show the seller the need for a certain repair or negotiate a better price. You can also take the report to a contractor and use it to make repairs or to remodel a section of the home.

One thing you should not do when buying a home is skip having the home inspected because of cost or undue pressure by the seller.  There's a reason why buyers should beware, and a home inspection gives you the information you need to make a sound buying decision.

THE TOP FIVE MOVING MISTAKES YOU CAN MAKE

Do you know what the Tuesday after Memorial Day is? It is the busiest day of the year for people to move items into  

self-storage and one of the most popular days of the year to move, earning it the name "National Moving Day."

Whether moving across town or across the country, packing up and moving can be stressful, costly and full of surprises. From shady movers and inaccurate price quotes, to overpacking or not allowing enough time to get the move set up, every step of a move has the potential for mistakes that can make a move a nightmare.

These tips will help anyone preparing for a move, whether they currently live in a house, an apartment, a dorm, with friends or with mom and dad.

1. Hiring a shady mover.

We've all heard horror stories about moving scams, and perhaps maybe you've been the victim of a moving scam yourself. You can steer clear of a less-than-upstanding mover by doing your homework. The Better Business Bureau, Angie's List, your state transportation regulator and the U.S. Department of Transportation -- and even your relatives, friends, neighbors and colleagues -- are all good sources of information about whether a moving company is on the up-and-up. Doing some homework online can save you a lot of heartache on moving day.

If you've done your research and still aren't confident in the movers you've come across, you always can go the DIY route -- just be sure you're up for the task.

2. Messing up the quotes.

If you hire a mover, you should be able to have someone from that company come to your place for an in-home moving estimate. If a moving company won't do an in-home estimate, you should think about shopping around for another mover.

Along those lines, don't rely on just one quote from one mover. Contact several movers for quotes. If you really like one mover over another but your favorite company is a little pricey, try negotiating for a lower price. Always make sure to get a moving estimate in writing.

3. Packing too much stuff.

Do you really need those old boxes of baby clothes that you haven't laid eyes on since your 6-year-old was in diapers? Before you move, you need to "edit" your belongings. Think about whether you can trash some of your possessions, donate them to charity, or give them away to friends and relatives. Perhaps you could hold a garage sale to clear out some of the clutter. If you haven't seen, worn or used something in a year, it's best to think hard about whether you need to keep it -- and whether you need to haul it to your new place.

4. Failing to schedule your move well in advance.

During the summer months, good moving companies are booked up quickly. Rather than waiting till the last minute, make sure your move is scheduled weeks -- or, better yet, months -- in advance. You don't want to be scrambling to find a mover the day before you're supposed to head out. Moving already is stressful enough without adding that frustration.

5. Ignoring the need to pack ahead of time.

You'll find very few people who'll say that packing is fun. In fact, a 2013 survey commissioned by SpareFoot found that people who'd moved in the past year identified packing and unpacking as the biggest hassle in the process.

You can lessen the load by beginning to pack well before moving day comes along. Start by boxing up stuff that you won't need right away -- for instance, if you're moving in the summer, pack up your winter clothes so that they're out of the way. Also, be sure to carve out time in your schedule to check items off your packing to-do list.

If you get down to the wire and need help with packing, enlist friends, neighbors, relatives or colleagues to lend a hand. Make sure you've got plenty of food and beverages as a "thank you" for your volunteer helpers. If you can't rustle up any free help, consider hiring laborers to do the packing for you; that may be a small price to pay to alleviate moving-related stress.

Staging Your Home To Help Sell Your Home

If you're getting ready to sell your home, there are a few things you should do first. At the top of the list are repairs, decluttering, and staging your home for a super sale. With the help of your

agent and/or homestager, you can create the perfectly staged home that's eye-catching at first glance.

In today's market that's vital; buyers typically begin their search online. That means they're going to view photos and videos of homes before they decide if they want to actually go to see the home in person.

Start with rooms that tend to be the biggest attractions: the kitchen, master bedroom, and bathrooms. Declutter first. Gather up large trash bags and boxes, then sort through the clutter by either packing up things that will move with you or throwing out trash and unusable items. Use another bag for items that you'll sell or give to charity.

Don't go on to another room until you have cleared away the clutter and the personal belongings in the first room. This process can become highly unsuccessful if you bounce between rooms, moving clutter from one room to the next. The idea is to get organized by having three categories: moving boxes, charity bags, and trash.

Once, you've cleared some space, now lighten and brighten the room. If you have dark or heavy curtains or window coverings and you're selling your home in the spring or summer, consider swapping them out for a lighter color and material that's more seasonal. They don't have to be expensive. They should, however, convey a tone of cheerfulness and help to open up the room and show off its best features.

Chipping and peeling paint, cabinets that look worn, and stained countertops are all signs of wear and tear. While these things alone may not deter buyers, they do give them cause to think twice about your home. However, it's a good thing there are quick and relatively simple tricks like applying fresh paint on the walls and refinishing cabinets and/or built-in shelf-tops. These fast renovations seem like huge improvements and add value to your home.

5 TIPS TO ADD VALUE TO YOUR HOME

We all know that renovated kitchens and bathrooms sell homes. Slabs of granite and gleaming floors make us ooh and ahhh…but do they top the list of projects that provide the best return on investment (ROI)? Not according to Remodeling magazine. Their annual Cost vs. Value Report on remodeling provides some insight into average remodeling costs, and this year, the top of the list in terms of value-add renovations is: a new front door.

Not a new kitchen. A new front door (more on this below). And it's not surprising to experts who understand that flash is great, but foundation is greater.

Basic maintenance, such as the roof and exterior painting, are frequently more important than an awesome kitchen.  If the roof is leaking, buyers won't get beyond that," no matter "how awesome the kitchen is.

It is the "basic systems" - roof, HVAC, plumbing - that buyers want to take for granted. "They assume the roof doesn't leak and the air conditioning and plumbing work. Maintenance can chew up a lot of cash quickly, and people are afraid of that."

Here are 5 unexpected ways to add value to your home:

1. The front door

"The top-ranking home improvement? A new front door, which on

average adds 96.6 percent of the amount you spent to the value to your home," said MSN. But "it has to be the right front door. Keep in mind that sometimes painting the existing front door provides the same payoff."

Even if you have to replace a steel front door, the cost is only $1,162 according to the report, with a resale value of $1,122.

2. The garage door

Another economical renovation that pays dividends is replacing the garage door. A $1,534 investment pays back $1,283, for an 83.7 percent return on investment.

3. Adding a deck

Most people wouldn't think of spending $9,539 on a deck addition at the expense of other, more necessary renovations and updates

when they are getting ready to sell. But for those who want to add a great amenity that also adds value and pays them back later on, a deck is a great way to go. The deck pays back $8,334 for an ROI of 87.4 percent.

4. New windows

No one wants to hear they need to replace their windows. It's thought of as a pricey job that doesn't have much tangible benefit, at least in terms of the "wow" appeal (like a renovated bathroom would have). But spending $10,926 on windows yields a 79.3 percent ROI, which translates to $8,662.

5. Attic bedroom

An addition to the house can cost huge dollars ($103,844 with a 67.5 percent return for a master bedroom, $155,365 with a 71.8 percent return on investment for a two-story addition). Which is why building up instead of out can be a great way to go if you need to add space. An attic bedroom is No. 3 on Remodeling's list of smart renovations, with a cost of $49,438 and an ROI of 84.3 percent, or $41,656.