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CAN THEY AFFORD MY HOUSE ?
1: BORROWING MONEY
Buyers need to know how much they can afford before presenting an offer, if the agent does not find this out, you could waste 3 weeks waiting for the finance approval on an accepted contract, only to find out that they cannot make the payments or have an undisclosed car loan that causes a decline.
2: FINANCE PRE-APPROVAL
Banks will give buyers an Approval in Principle before they start looking for a home, this is only a guide based on the amount they can repay. When buyers say "oh its fine, we are pre- approved" the agent needs to ask more questions and find out the amount they can actually afford by contacting the finance broker or bank.
If your buyer is issued with a pre-approval its a positive sign that they are clear about what they can borrow.
3: DEPOSIT
Your agent needs to encourage buyers to commit to a good deposit, this gives sellers confidence that the buyer is serious by putting their money on the line. A strong deposit is a good sign of the buyers intentions and commitment, however we are seeing less high value deposits due to the credit culture.
​4: BANK VALUATION
Once you receive an an acceptable offer, the buyers bank can issue a Conditional Finance Approval subject to a valuation, the bank then carry out the full valuation. This is done by either sending a licensed valuer to look through the home or by doing a drive by valuation. If the Loan To Value Ratio is acceptable then a formal approval is issued by the bank and the property proceeds to settlement . The cost of the valuations are all covered by the lender.
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5: FINANCE DECLINE
​​A good agent can rescue the sale If the buyer is issued with a finance decline. This is done by organising another bank to assess the buyers finance application and another property valuation. This can be relatively quick, however its always dependent on the buyers being willing to work with another bank. We have rescued many sales by helping buyers secure finance and more often at better interest rates than their original lender
9 QUESTIONS TO ASK AGENTS
1. What experience do you have?
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Experience in real estate, is essential. The chances of an agent securing a high sale price, depends on their ability to build a rapport with potential buyers. Interrogating a prospective agent’s resume is a priority. Ask the agent how long they’ve been working in the industry, and whether they have a license, as opposed to a real estate registration that only takes 4 weeks to get, rather than 2 years.
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2. Which local properties have you sold recently?
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Asking this question will shine a light on the agent’s selling ability and the prices they have achieved. This will also give you an idea about the agent’s assessment of pricing your property. It’s a common practice for inexperienced agents to use the overpricing tactic, which can cost you money and waste time. Ask the agent to give you an exact sale price that they feel is achievable. It’s also worth asking for the contact details of past vendors, so that you can fact-check the agent’s claims.
3. How much do you know about the local area?
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Local knowledge is vital when it comes to selling real estate. As soon as a buyer steps foot into your home, they begin to paint a mental picture of what their life would look like if they moved in – and it’s the job of your agent to fill in any gaps. The more your agent knows about the local area, the easier it will be for them to answer a potential buyer’s questions.
4. How much do you know about planning?
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A deep understanding of the local area should also be complemented by a full knowledge of local planning regulations, this allows the agent to educate the buyers about and any potential upgrades, rezoning or added value renovations that your property may have.
5. Who do you think will be interested in my property?
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Before you can reach an audience, you need to know who that audience is. If your agent doesn’t know who the potential buyers for your property could be, then your marketing campaign has little chance of success.
6. How will you market and sell my property?
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You should discuss everything from which selling method your prospective agent recommends for your property, to how they plan to make it stand out.
Ask how many buyers they have ready to view your home and where they expect other buyers to come from, knowing this will help you develop a marketing plan that captures more of that target market.
Ask the agent to demonstrate how they’d handle the negotiation with the buyer; this will give you some insight into their knowledge and creative communication skills. If they are friendly, clear and concise with a firm but positive frame of mind then you’re on the right track.
7. Are you too busy to sell my house?
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Ask who will be managing your property sale, many agents will put juniors at the homeopens, they are generally inexperienced and unable to answer questions or educate potential buyers to the features and benefits of your home.
8. What are your fees?
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While agent’s fees should not be your main consideration, it’s important that both parties understand what’s expected from them before they sign any contracts. Ask for a clear written overview of the agents fees, marketing strategy and costs, this reduces the chance of any disagreements. Don’t fall for confusing fee structures and costly marketing strategies. Good agents should be fully confident in their ability and communicate the right solution to get your property SOLD in the shortest possible time, for the highest possible price.
9. Why are you the best person for the job?
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Asking this question will put the agent on the spot and offer a glimpse into how they think on their feet. The standard answer they give will be about their experience, sales and database of buyers. However the most important reason to employ them, is that the agent has the knowledge, energy and belief to achieve the highest price through educating the buyers about the features and benefits of the home.
