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        <title>The Monopoly Report®</title>
        <link>http://www.carlandcompany.com/blog/author/carl-eschenburg/</link>
        <description></description>
        <item>
            <guid>http://www.carlandcompany.com/blog/buyer-agency-agreement.html</guid>
            <link>http://www.carlandcompany.com/blog/buyer-agency-agreement.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Buyer Agency Agreement</title>
            <description> <![CDATA[  I think one of the most misunderstood concepts in Michigan real estate today is that of the buyer agency relationship and what it means to have a Buyer Agency Agreement. I've heard an incredible number of people say that they prefer to just drive around or browse online while randomly calling real estate offices for information and they don't want to be "trapped" working with just one agent. I've heard an equally incredible number of gasps when they realize the truth about buyer agency and how it REALLY effects them as potential home buyers.

In the early 90s there was a significant shift in Michigan law regarding 
the legal relationships between real estate licensees and the clients 
they service. This change came in the form of a legally recognized Buyer 
Agency relationship which is easily explained and understood using the Michigan Agency Disclosure document. While this disclosure is mandatory, by law, to be signed by EVERY buyer an agent represents, the unbelievable truth is that most agents fail to present this disclosure when it matters most; when they first meet a potential client!


When working with an agent to purchase your home you would naturally assume that the agent is working in your best interests and in essence is working for you. The harsh reality is that this is not the case under Michigan law unless a written Buyer Agency Agreement exists. In fact, its quite the opposite!


EXAMPLE: If a Seller lists their home for sale with Agent X of ABC Realty Michigan law states that the listing agent, listing Broker and EVERY other agent at ABC Realty work directly for the Seller and are obligated by law to share any and all information they learn about a perspective buyer with that Seller. So when you call ABC Realty ANY agent you speak with actually works directly for the Seller! In fact, if you don't have a written Buyer Agency Agreement with an agent YOU selected ANY agent you speak with at EVERY real estate office in Michigan works for that same Seller! Yes, you read that right EVERY real estate agent that you talk to about ANY house on the MLS is actually working for the seller as a Seller's Agent OR Sub-Agent. This is true even if they work for a company OTHER than the office listing the home!


This amazing fact is supposed to be disclosed to you in writing by any real estate agent you speak with BEFORE you disclose any personal or confidential information about yourself, finances or goals as a home buyer. Unfortunately this is rarely the case and most agents simply slip both the Agency Disclosure and Buyer Agency Agreements in front of unsuspecting buyers as part of the purchase package AFTER they've worked together for an extended period of time and know everything there is to know about the buyer(s) and their situation. 


A written Buyer Agency Agreement is a powerful tool that was meant to empower you as a consumer NOT "trap" you or force you into working with someone you don't feel comfortable with. In fact it's the opposite! We recommend that our potential clients interview more than one agent and select the person they feel most confident can represent them best in their purchase BEFORE they start looking at houses.

By giving you the right to legally work with an agent YOU choose you are assured that you can work with Mr. or Mrs. "Right for You" instead of having to settle for Mr. or Mrs. "Right Now"; and no-one wants to make that mistake :-) ]]> </description>
            <pubDate>Wed, 14 Mar 2012 06:04:16 -0500</pubDate>
            <category>Agency,Buying a Home,Buyer Agency</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/size-really-does-matter.html</guid>
            <link>http://www.carlandcompany.com/blog/size-really-does-matter.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Size Really Does Matter!</title>
            <description> <![CDATA[ 
Question: Can the size of my down payment make a difference in my negotiations?


Answer: Absolutely! In the past several months we have seen more and more competitive bidding for move-in ready Metro Detroit homes. When this is the case EVERY attribute of a Purchase Agreement has the potential to strengthen or weaken your offer in the eyes of the seller. Buyers who do not take this into account will find the seller then focuses on the elementary elements of their offer and this usually means a laser focus on price.


To maximize your potential for a favorable negotiation be sure to structure your offer in a way that forces the seller to think about more than just the price. While there are several strategies that can accomplish this, in most cases the size of your down payment has the potential to be a key component of a winning the bid.


Skilled agents and savvy sellers will note the size of the down payment detailed in the Purchase Agreement. In general, when a potential buyer makes an offer with a large down payment they are perceived as a strong buyer. When their offer is viewed against other competing offers, or even past offers, the seller will tend to have more confidence in the offer with the larger down payment. We see this regularly when an FHA buyer with the minimum 3.5% down payment loses a bid to a 5% down conventional mortgage buyer. Even that small of a difference (1.5%) makes a big difference in the eyes of the seller. I've even seen numerous examples where a seller actually took a LOWER offer just because the down payment was higher and they felt had a stronger buyer! 


In a nut shell, when purchasing a house, regardless of the type of mortgage you select, offer more than the minimum down payment. Even a small increase in upfront cash can send a strong message to the seller and be the difference between winning and losing the bid.
 ]]> </description>
            <pubDate>Mon, 12 Mar 2012 21:21:12 -0500</pubDate>
            <category>Buying a Home,A Client Asked Me</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/trap-1-national-real-estate-sites.html</guid>
            <link>http://www.carlandcompany.com/blog/trap-1-national-real-estate-sites.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Trap #1 | National Real Estate Sites</title>
            <description> <![CDATA[ Myth: Websites like REALTOR.com, Trulia, Zillow and ListingBook are the best sources to find potential homes and gather information.

Truth: These companies are first and foremost marketing companies and their sites are set up to service real estate professionals NOT
 the home buyers and sellers that use them everyday! They make their 
money by attracting buyers to their sites with the promise of free 
access to millions of homes and then sell your information to real 
estate agents and brokers hoping to gain a client. The worst part is 
that the information they use to attract you is merely repackaged MLS 
information and is usually inaccurate, incomplete and out dated. It's 
not uncommon for a client to call us with a list of 10-15 homes they 
found using these sites, only to find that 80-90% of them are pending or
 have been sold for quite some time!


Example: Number of Active Listings by Area and Source






 


REALTOR.com


Trulia


Zillow


Actual*




Grosse Pointes


805


 552


 480


363




Macomb


430


 720


 562


318




Saint Clair


130


 241


 239


75






*Actual active MLS listings at time of writing



Solution: Once you start driving neighborhoods, "curbing" 
potential homes and narrowing your list of properties. Instead of relying on the commercial websites find a 
trusted locally focused agent or brokerage website that has a direct connection to the actual MLS and offers an option to inquire about any property currently for sale.
 ]]> </description>
            <pubDate>Thu, 01 Mar 2012 20:37:03 -0600</pubDate>
            <category>Buying a Home,Buyer Traps</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/trap-2-calling-for-sale-signs.html</guid>
            <link>http://www.carlandcompany.com/blog/trap-2-calling-for-sale-signs.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Trap #2 | Calling For Sale Signs</title>
            <description> <![CDATA[ Myth: The company that has the home listed is the 
best source of information on the property and you can probably get a 
better deal if you deal with them directly.

Truth: Under Michigan law the broker that has the 
home listed and all of thier agents legally work for the seller. They 
are
 obligated to disclose to you, by law, that any personal information you
 provide them
 is required to be shared with their client, the seller. They legally 
owe all fiduciary responsibility to the seller which means they are also
 obligated to sell the home for as high a price as possible under 
current market conditions. You are therfore at an 
extreme disadvantage when you call their office for three reasons:




Regardless of whether or not the agent you speak with is the actual 
listing agent, he or she has the same agency relationship with the 
seller under law. Therefore, they are in fact your adversary as a 
potential buyer!


The agent who answers the phone when you call will most likely know 
little to nothing about your property of interest because they are most 
likely NOT the listing agent. Most offices only have a 
handful of full-time agents that
are actually responsible for listing the majority of homes they sell.  
The other agents take shifts answering calls to find buyer 
leads. 


They cannot legally negotiate a deal in your favor. Since they 
legally represent the seller they have a fiduciary responsibility to 
maximize their client's return on the sale of their home.




Solution: In short, find a full-time agent you feel comfortable 
with and ask them about buyer agency. You have the legal right
 to select an agent you choose to represent you in your
 real estate related transaction. By law agents are required to provide 
you with the standard Disclosure Regarding Real Estate Agency 
Relationships document before you share personal information. This document will give you a clear understanding of the 
various types of relationships that can legally exist in Michigan and 
will empower you to protect yourself right from the beginning of your 
home search.
 ]]> </description>
            <pubDate>Thu, 01 Mar 2012 20:36:45 -0600</pubDate>
            <category>Buying a Home,Buyer Traps</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/trap-3-foreclosure-short-sale-inventory.html</guid>
            <link>http://www.carlandcompany.com/blog/trap-3-foreclosure-short-sale-inventory.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Trap #3 | Foreclosure &amp; Short Sale Inventory</title>
            <description> <![CDATA[ Myth: Foreclosures, bank owned, government owned and short sale homes can still be purchased for pennies on the dollar.

Truth: The massive drop in home values in Michigan 
over the past 6 years has basically leveled the field between the 
distressed properties and the privately owned homes listed for sale. 
What this means is that the days of being able to find a foreclosure 
that was move-in ready and purchase it for 60% of its actual value are 
long gone. The banks have been holding foreclosure inventory back and in
 essence controlling the prices by slowing the release of new inventory 
into the market place and pricing their homes at market value less 
renovations. This has brought an equilibrium of sorts that was absent 
just a couple of years ago which translates to great opportunities ONLY 
if you are willing to purchase a home that needs at least some work to 
bring it back to "retail" condition. In most cases the purchase price 
plus to cost of renovations puts the total cost of ownership right at or
 just slightly below fair market value of a similar privately owned home
 in the same area. These few-and-far-between deals typically get 
purchased very quickly and in competitive bidding situations involving 
cash investors.


Solution: Obtain access to 
reliable and real-time 
alerts of foreclosure listings from your buyer agent. Be sure to ask 
them for guidance on how to read the listing tickets effectively and 
what to avoid. This will prevent you from looking at a large number of  
homes that turn out to require too much renovation to met your needs. 
The combination of this relationship with a trusted advisor and thereal 
time listings will put you in a powerful position to quickly 
write an offer and get it accepted if and when you do find the perfect 
distressed property deal.
 ]]> </description>
            <pubDate>Thu, 01 Mar 2012 20:33:36 -0600</pubDate>
            <category>Buying a Home,Buyer Traps</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/mls-multiple-listing-service.html</guid>
            <link>http://www.carlandcompany.com/blog/mls-multiple-listing-service.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>MLS Multiple Listing Service</title>
            <description> <![CDATA[ 
M·L·S | acronym | Multiple Listing Service


A multiple listing service or "multi-list" is a private forum in which participating member brokers and REALTORS® share information about  real estate they have available for sale or lease. In years past the MLS was a literally a book that held paper listing tickets detailing area listings of "Cooperating Brokers". Today the MLS has evolved into a network of sophisticated computer databases offering both private (members only) and "public" access.


By listing properties in this forum agents are able to market them directly to a very large and focused audience: the thousands of area agents who represent actively shopping buyers.


As a listing agent the primary objective is, and always should be, effective marketing of a client's property. Simply put:




If no one knows your home is for sale then it will never sell.




The MLS is an effective way to introduce a new home to the market because it leverages the relationships of thousands of buyers working with area agents who may not be part of your listing agent's company.


Since the Michigan Multiple Listing Services require a professional designation for subscription and because Michigan is a Buyer's Agency State, having your home listed on MLS assures you that area professionals will be exposed to your home and have the opportunity to review and present it to buyers your listing agent would not otherwise have access to.


While there are many additional marketing and advertising tools needed to effectively sell a home in today's challenging market, the Multiple Listing Service is an essential tool agents should be using. Be sure when selecting an agent to list your home that he/or she is a member of at least one MLS, and is willing to list your home quickly and accurately using this resource.
 ]]> </description>
            <pubDate>Fri, 25 Mar 2011 09:32:24 -0500</pubDate>
            <category>Real Estate Terms</category>
                    </item>
        <item>
            <guid>http://www.carlandcompany.com/blog/functional-obsolescence.html</guid>
            <link>http://www.carlandcompany.com/blog/functional-obsolescence.html</link>
            <author>Carl@CarlAndCompany.com (Carl Eschenburg)</author>
            <title>Functional Obsolescence</title>
            <description> <![CDATA[ 
ob·so·les·cence | noun | a loss in the utility or value of property that results over time from intrinsic limitations (as outmoded facilities) or external circumstances.




func·tion·al ob·so·les·cence
:: obsolescence deriving from lack of adequate or appropriate equipment, space, or design.




Real Estate Examples:




Homes with 3 bedrooms and only one bath were popular in the 50s and 60s, but are now considered functionally obsolete because most buyers want a minimum of two bathrooms.


Homes with detached, 1 or 1.5 car garages are functionally obsolete; homeowners don’t want to walk that far (especially in the snow and rain) and most have a second vehicle or “Stuff” for which they need storage.


Think about how things have changed in the past 15 years with home technology alone. It was a big deal to have a house pre-wired with multiple analogue phone lines just a few short years ago. Today, few people even have land lines in their homes? 


Houses with CAT-5 (Computer network) wiring in every room were very attractive for a short period of time, but now that wi-fi is available and so reliable network wiring is an obsolete solution for most residential situations.


 ]]> </description>
            <pubDate>Tue, 15 Mar 2011 07:57:21 -0500</pubDate>
            <category>Real Estate Terms</category>
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