Have you noticed that you can literally go almost a full day without speaking to someone if you wanted to buy something, order something, research something……there is an app for ordering a coffee before you arrive so it is waiting for you…you can go to the grocery store and check out through the self check out isle….and who doesn’t love Amazon.com? You really don’t have to speak to anyone if you don’t want to. My parents generation (they are in their early 80’s) is all about making a connection. They don’t like the idea of ‘self’ anything. They want to speak with the cashier at the grocery store, they think it is rude to be so non-communicative.
My parents generation does not drive the economy like the younger generation does. Look at the type of programming on TV we have now. Advertisers target age groups between 30-45. That group loves an app, ease of use, a Tweet to get their news, something needs to peak their interest to get an indepth analysis. When their interest is focused, they are amazing at finding stuff. Back in the day, we had to go to the Library for an encyclopedia, now that information is just a quick Google away. These folks get fully immersed in whatever it is they want to know about and feel like they are as good as an expert. Sometimes they are.
In real estate we have gone from being a very individual centric business model to one that is more about the collective. Back in the day, a Realtor had to go to the local board of Realtors to pick up daily listings to show their clients. Now, prospective buyers and sellers can get a lot of the same information as an Agent has by going online. Zillow seems to be dominating our local markets. This isn’t because of my parents generation – Zillow knows that they are not the drivers of the market. Zillow, like other online services, target the markets that are most receptive and have the most disposable income to drive sales.
Here is where that type of situation doesn’t work out well for the real estate consumer, both buyer and seller, because the transaction part of the sale is very fluid. There are more than 40 people working behind the scenes when a deal is in escrow – if you don’t work with a Realtor that has experience, a good team and negotiation skills – the old saying, “You don’t know what you don’t know” comes into play here.
Here is an example: Recently I was representing a buyer in a sale where the seller had a HERO lien on the property. HERO liens are loans that are made by the PACE program for clean energy. People use these loans, that then turn into liens on the property, to finance energy saving central air and heat, solar panels and solar collection systems. When a homeowner takes out a PACE loan for one of the covered items, the property now has a lien on the Title and cannot be purchased without the re-payment of the loan, which removes the lien, in most cases. If a buyer is using an FHA loan to purchase a property with a HERO lien on Title, the situation becomes very dicey. Here is why…..Buyers with high DTI (Debt to Income) ratios often need an FHA loan to qualify because they have higher debt than a conventional loan will allow. Lenders are required to slide HERO lien debt, that can be as much as $50,000, onto the buyers DTI. This extra debt from the HERO lien could push the buyers DTI above what the lenders allow.
A buyer or seller wouldn’t know this unless they had a really good and experienced Realtor and lender who could navigate this. Spend less time trying to learn about the whole business of real estate and find yourself a great Realtor, like us, to help! You will be happy and in the end your transaction will be the best it could be!