Real Estate FAQ
The process of buying and selling real estate can sometimes feel a bit daunting. Most people have questions about the process and for that reason, we have included the following list. Feel free to browse the frequently asked questions listed below for any questions or concerns that you may have. If you have other questions, please call or email us from the contact page.
Why should I use a real estate broker?
What is the difference between a real estate agent and a real estate broker?
What is the difference between a buyers' agent and a sellers' agent?
How do I choose a property to buy?
Where can I find a real estate code of ethics?
What contract terms do you set?
What is a property inspection?
What is an appraisal?
Should I get an appraisal on my real estate before I list it?
What is equity?
Do you offer financing?
How long will it take for my property to sell?
What can I do to make my house more "sellable"?
What are closing costs?
What is HUD housing?
Why Should I use a real estate broker?
If you are selling a home we can be an indispensable resource. We can give you current information regarding prices, financing, terms and conditions of competing properties, and information about the housing market in general. We will market your property to other real estate agents as well as the public, and will know the best way to go about doing so. We can further help you objectively evaluate buyer proposals and then, finally, help you close the sale. In fact, the sales price of an agent-assisted home generally is higher than one sold “by owner”.
If you are a buyer, having our assistance can be equally important. We have resources for assisting you in your home search not available elsewhere. We can provide you objective information about each property, and give you advice based on years of experience. We can negotiate and also coach you through the closing process to make sure everything goes smoothly.
Back to Top
What is the difference between a real estate agent and a real estate broker?
In Colorado the state issues only broker licenses. Colorado is a single-license state. To obtain a Colorado broker license you must complete 168 hours of pre-license education, pass the state exam, submit a set of fingerprints, and submit an application to the Real Estate Commission. Agent is a general term that many states use and many refer to, however in Colorado everyone is technically a broker. There may be an employing broker who supervises other licenses, an independent broker who may not hire or supervise other licensees, or an associate broker who works under the supervision of another broker qualified as an employing broker.
Back to Top
What is the difference between a buyer's agent and a seller's agent?
Again, everyone in Colorado is technically a broker. Each broker has different working brokerage relationships with their clients. The way you begin determines which forms are required and what your beginning legal relationship emerges as. When you work with buyer or seller you may begin a relationship in the following ways:
1. Have an exclusive agency listing with a seller or (listing agent).
2. Have an exclusive agreement with a buyer (buyers’ agent).
3. Have a transaction-broker listing with a seller or buyer.
A sellers’ agent might choose to retain a listing broker, to help the seller market and sell real estate (example “list” a house for sale). A listing broker’s loyalty is to the seller, and will likely advise the seller about property values, asking price, and negotiation and marketing strategies.
A buyers’ agent is a person retained by a buyer to help them purchase real estate and represent them in the transaction. The buyers’ agent can consult with and advise the buyer about the state of the market, available properties, financing, property values, and all the other details involved in buying real estate.
A transaction-broker is a real estate professional (broker in Colorado) who assists the buyer OR seller OR both in the same transaction. The transaction broker’s job is to act fairly and not favor one party over the other. Colorado law does not permit dual agency, (i.e. be a seller agent and buyer agent on the same transaction) therefore a transaction broker is by default the type of brokerage relationship that exists if you do not have a written agency agreement. A transaction broker is not an agent for either party.
Back to Top
How do I choose a property to buy?
Let Tom and Greg Smith send you a Homefinding Guide to help you understand the process of finding and buying a home. We understand that buying a home is a major decision. Our goal is to take you through the homefinding process, making it as efficient, stress-free and successful as possible. In order to best serve you, we will need to spend time with you learning more about your unique needs, both in a home and of your real estate sales professional. Our goal is that you will be delighted with your home buying experience.
Please feel free to call us at any time.
In addition, you can go to www.HUD.gov . The U.S. Department of Housing and Urban Development has a fantastic site with excellent advice.
For a short version, here are a few items to think about.
- Determine your financial situation.
- Educate yourself about the mortgage industry
- Get Pre-Approved for a Mortgage
- Nail down your needs
- Become versed with Real Estate Brokers
- Start you Home Buying Search
- Examine all Pre-Offer Assignments
- Make an Offer
- Home Inspections and Warranties
- Closing and Possession
Back to Top
Where can I find a real estate code of ethics?
The National Association of Realtor® ‘s web site is a fantastic site with all the codes. www.realtor.org
Back to Top
What contract terms do you set?
When buying a home the type of working relationship and length of terms is determined by you. When selling your home the standard commission is 6% (3% for listing agent, 3% for buying agent), the length of contract is determined by the seller.
Back to Top
What is a property inspection?
A buyer’s inspection is paid for by the buyer and documents the condition of the house prior to purchase. Most inspections give you a complete and accurate account of your prospective home’s condition and help you make the right decision. Go to www.nahi.org to view a national website.
Back to Top
What is an appraisal?
A real estate appraisal helps to establish a homes value. Your lender requires an appraisal because it wants to make sure that the property will sell for at least the amount of money it is lending. Also, do not confuse a comparative market analysis (C.M.A.) with an appraisal. We use a CMA to determine an asking price for clients. An appraiser's report is much more detailed and is the only report a bank will consider when deciding to approve or disapprove a mortgage.
Back to Top
Should I get an appraisal?
No, the buyer pays for this and will need one if they are getting a loan.
Back to Top
What is equity?
Home equity is the value of a home minus the mortgage debt and other encumbrances. Remember, your monthly mortgage payment (in some cases) includes principle, interest, taxes and insurance (PITI) so when trying to determine the amount of principle paid so far you can’t just add up the total payments you have made during the life of the mortgage. Example: If you have a home worth $250,000 and a $150,000 mortgage, the equity is $100,000.
Back to Top
Do you offer financing?
We have numerous lenders that we work with and can refer you to any one of them. In our office we have www.wfhm.com/jack-hamilton as a convenience to our clients. Jack can be reached at 970-377-4862 or 1800-283-1856 ext.4862 or email jack.hamilton@wellsfargo.com
Back to Top
How long will it take for my property to sell?
There are many factors that go into making a property appealing. There are many variables involved in closing the deal. We have no way of answering that question for sure but experience shows that if the price can not be justified by the market comparisons the property may not sell at all. A property thought to be not in demand will not sell at any price or simply there must be a market for the property to sell. A property may eventually sell below market value, but as “a rule of thumb”, a properly priced house or property will sell within a one year period. Generally within the first three months if priced properly. The most activity a new property usually sees is in the first 3-4 weeks.
Back to Top
What can I do to make my house more "sellable"?
To maximize your house’s sale potential you want your house to be presentable to buyers and show off its strongest features. To do so, take a fresh look at your house through a buyer’s eyes. See your residence as a house for sale instead of your family home. This will help you identify its strong points and where it can use some help.
Email us at Greg@ownfortcollinsrealestate.com or call 1 800–466–1189 or 970-226-5511 and we will mail you a Preparing Your House For Sale brochure from Prudential Real Estate.
Back to Top
What are closing costs and who pays them?
There are certain costs related to closing the sale of a house or property. The fees are split between the buyer and the seller as terms agreed upon in the sales contract. As we negotiate the sales contract for you, we will not only work to get the sales price you want, we will also work to limit the number of closing costs for which you are responsible. We will walk you through the closing costs, answering any questions you may have along with explaining which costs are prescribed by law to be yours and which are negotiable. Buyers will receive a “good faith estimate” of closing costs at the time the loan application is submitted to the lender. The estimate is based on the loan officer’s past experience and may not include all the costs. We will be glad to review the estimate and point out missing costs or estimates we feel are too low.
Basic Closing Costs Include:
Taxes
Property Taxes
Transfer Taxes and Recording Fees
Loan costs
Loan Origination Fee
Points
Appraisal Fee
Credit Report
Interest Payment
Escrow charges
Insurance
Title Insurance
Home Owners insurance
Private Mortgage Insurance (PMI)
Back to Top
What is HUD housing?
The Federal Housing Administration (FHA), part of the U.S. Department of Housing and Urban Development (HUD), provides federal mortgage insurance, which insures that mortgage lenders will be reimbursed when owners default on the loan. When an owner fails to make payments, the lender forecloses on the single family home, condo, or duplex. It can then file a claim with the FHA for the balance due on the mortgage and convey title of the home to HUD. So a HUD home is a residence HUD has acquired as a result of lender foreclosure on a FHA insured mortgage.
For more information, you may wish to visit http://www.hud.gov/
Back to Top |
