Call me at 306.533.1395 | curtis@heycurtis.com

05 Oct

Posted at 16:08h in Buying a Home by

Hoping to buy a home? Awesome, it’s a great idea.

Buying a home always starts at the lender—you need to be sure they’ll give you some money.

The first time you call or visit your lender, they will either pre-qualify or pre-approve you, and they aren’t the same thing. One’s like a breezy chat with your favourite aunt, while the other feels more like a job interview with a side of paperwork-induced migraines. Let’s break it down, shall we?

Pre-Qualification: Think of it as the friendly neighbour who pops over for a chat on a sunny Sunday afternoon. Your lender asks you a few questions, does some quick math, est voilà, they throw out an estimate of what you can borrow. Mortgage brokers love this one because it’s a hook to get you in—a five-minute icebreaker, and who doesn’t have five minutes? They’ll save the tough questions for later; they don’t want you walking across the street on them for now.

Pre-Approval: Now, this is where things get real. Like “meet the parents” real. The lender rolls up their sleeves, pulls your credit score, and scrutinizes the darkened corners of your finances. They’ll ask you to produce more documents than you knew you had. Not exactly a picnic, but it’s a necessary step before you can officially call yourself a homeowner.

Here’s the deal:

  • A pre-qualification is informal. With merely a pre-qualification, you’re still watching from the sidelines. You can’t shop for a home. 
  • A pre-approval is formal. With a pre-approval in place, you’re in the game. You can shop for that dream home and even make an offer.

 

Good Advice: Ask your lender to provide a letter of pre-approval. They might not like it because it’s a pain but do it anyway. Take the wheel and drive. I’ve seen sales fall through on financing because the buyers couldn’t get a loan. They thought their lender had pre-approved them correctly but hadn’t. How’d you like to drive past your dream home and see another dude mowing the lawn because your mortgage broker fumbled the ball. Brutal.

 

CB

15 Nov

Posted at 12:00h in Buying a Home by

Just because the lender gives you a pile of money doesn’t mean you have to spend it all.

Recently a client (and friend!) sent me his pre-approval letter for $375,000—well done for a 30-year-old dude.

We’re looking at houses in the 300k range right now. He didn’t earn a $375,000 qualification by being careless with his money.

At 30 there’s still plenty of time to get everything he wants, for now, he’d be happy to keep a little walking-around money.

I’m not saying everyone should do that, just don’t venture out of your comfort zone.

Curtis

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20 May

Posted at 22:51h in Buying a Home by

Don't Use This DoorIt’s a little thing, but you’re trying to win at this.

When your new listing hits the market, somewhere on your property there will be a lockbox holding the key. Like trained search dogs, REALTORS® arriving to show your house sniff out the location. You should see us in action, it’s beautiful to watch. Once located, we head for the closest door and in.

So, let’s make sure the closest door is the one that impresses the most—usually the front door.

“But hey Curtis, we don’t use the front door, we always come in the side door.” That may be true, and the new owners will likely do the same thing, but the side (or back) door usually leads to a stairwell or cramped space. We don’t want buyers waiting while the person in front of them takes off their kicks.

Let’s bring ’em through the front door.

Curtis

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20 May

Posted at 19:38h in Buying a Home by

People love a story.

I listed a home in Normanview for a friend of the family. Our families lived a few blocks apart and I played hockey with her son growing up. Everyone had long moved away, her husband had passed, but she remained steady in the house from the day it was built in 1974. They raised two boys in their house and made lifelong friends with the neighbours, both current and past. A few years back, after turning 70 something, it became clear it was time to move to a condo.

As you can imagine, this was an emotional time, 42 years in the same house. But on schedule, that spring, the sign went up. Her home was immaculate and we priced it well—within a week we had an offer.

When I met her to go over the offer her first question was, predictably, “how much?” The second question—“who are they.” I told her I had no idea. She replied “really?”

You see, the buyer’s agent had just fired me the offer in an email with the subject line “scanned from MFP07868497”. She didn’t bother with a follow up call either.

With the offer on the table, we could see there was a man’s name just above the line “buyer”, so we tried to guess what that person might be like. Is he young or old? With a name like Thomas, he could be either! I wonder if he has a family. I just checked Facebook and only one result showing he works at “retired”. His profile picture is a Rider logo—that’s something right? The offer was open until 10 pm.

So did the buyer’s agent do her job? She did her job, she just didn’t do it well.

I’ve learned over the years that sellers always want to know who’s trying to buy their house. They have fond memories, it’s part of their life, their story. They (usually) like the neighbours, and just about always want to see the house go into good hands. Years after the home is sold they slow down when they drive past. I’ve even seen sellers with multiple offers take less money because the agent with the higher offer acted like a putz.

Every single time I write an offer for one of my buyers, I phone the listing agent and tell them all about my wonderful clients, because I know the seller is going to ask. The listing agent appreciates it too, after all, they are hoping the sale comes together—it’s how they make a living.

People negotiate differently with people they like or at least think they like. When the sellers consider your offer they factor this in. Now when the counter comes back, it’s usually a little softer, or maybe no counter at all.

If you’re buying a house, ask your Realtor how they plan on selling you. Let’s get that offer accepted 🙂

CB

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12 Apr

Posted at 16:00h in Buying a Home by

All buyers should understand Double-Ending. REALTORS® like it because they get paid more, but for you, it could be a disaster. 

Here’s a Common Scenario

You’ve been following the market online for a while and finally found a home that looks perfect for you. You took a drive past, and it’s everything you thought it would be. Priced right, good area—exactly what you’re looking for. What Now?

Well, because you aren’t working with a Realtor, you call the name on the sign. This person is known as the listing agent. You explain, excitedly, that you are considering making an offer. The listing agent jumps all over it and offers to show you the home. He tells you to bring a cheque.

You have a look, and the home doesn’t disappoint—it’s the one! You tell the Realtor (whom you’ve just met) you want to write an offer. That’s fine, right? He’s a Realtor, so why not let him write the offer for you?

Double-Ending Explained

First off, I’ll tell you how Realtors get paid. The short answer is to sell a home. This is also the long answer. We receive a commission on the successful sale of a home. Unless we work part-time at the Home Depot, we have no other income.

Further, the seller supplies the commission we earn—buyers don’t pay commission. The Realtor representing the buyer then gets paid a portion of the total commission offered by the seller. It’s usually a 50/50 split, so if the seller’s full commission is 4% of the sale price, 2% goes to the agent that brings the buyer (writes the offer), and 2% goes to the agent that listed the property. 

Most home sales in Regina (90% plus, I’d guess) involve two Realtors, one representing the buyer and the other the seller. From time to time, though, the listing agent represents both the buyer and the seller in a transaction. This is known as double-ending. Realtors like this because they can earn both sides of the commission split or “double” the amount of money.

Here’s the Problem With It

It’s a conflict of interest. The Realtor has “inside” information on both parties.

I guarantee the listing agent listens carefully to every sound that comes from your mouth. Clues about your financial ability, motivation and where your head is at.

The listing agent also has a relationship with the seller. He knows why the seller is moving and usually knows how much they’ll take for the home. He may even be good friends with the seller.

With This in Mind, Can You be Sure the Listing Agent is Acting in Your Best Interest? 

How do you know he didn’t overhear (or maybe you just told him) that you would pay $275,000 for the home but would like to offer $265,000 to see if the seller will accept it. When the counter comes back at $275,000, you’ll wonder if the Realtor sold you out.

Realtors follow rules (I must stress) to ensure this doesn’t happen and all parties are treated fairly. When a Realtor acts for the buyer and the seller in a transaction, they must not discuss money or motivation with either side.

This means that when you look to the listing agent for advice on how much to offer or inquire as to why the seller is moving, they have to close their mouth and tell you they can’t help you. You’re on your own to try and figure out how to proceed.

Doesn’t Seem Very Helpful, Does It. So What Should You Do?

The best solution is to have a different Realtor from another brokerage work on your behalf. They can serve you better by helping you come up with a strategy to get the property for a good price and make sure all the inspections are done correctly.

Since Realtors are free when you buy—we get paid by the seller—it doesn’t cost you any money to have better representation.

Having someone that doesn’t have an interest in the subject property working on your behalf ensures you get fair and impartial advice.

Curtis

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01 Jul

Posted at 09:33h in Buying a Home by

In Canada, you require a minimum of $220, $2.35, $240, $2.45 to buy an extra-large coffee at Tims and a minimum of 5% of the total purchase price available as a downpayment to buy a home. Check your bank account and if you have less than $5, buy yourself the coffee and your co-workers a box of donuts. Sadly, you won’t be buying a home.

In addition, you need the 5% downpayment saved and in a bank account, as a gift with documentation of such or in an RRSP. You can’t borrow the down payment. Buyers with a down payment of less than 20% of the total purchase price must have their mortgage insured against default. Mortgage insurance protects the lender and not the borrower. It assures lenders that they will be covered if a borrower defaults on, or fails to make, their mortgage payments within 90 days of being due. The lender is the one that actually buys the insurance for their benefit and then passes the cost on to the borrower. Bummer. The insurer most people have heard of is The Canadian Mortgage and Housing Corporation (CMHC). The CMHC is a federal crown corporation and is the largest insurer of residential mortgages in Canada. Their rates are here and vary depending on the amount you put down. Borrowers also have the option to choose private insurers that include both Genworth Financial Canada and Canada Guarantee. All 3 are good choices but are all a little different. Have your lender discuss the benefits of each. If you have more than 20% of the purchase price available as a down payment, congratulations! You manage your money well and will not need mortgage insurance. This is called a conventional mortgage. Some lenders will opt to insure the mortgage anyway but are not required by law to do so. The lenders will not typically pass this charge along to the borrower. Saving for a down payment is a challenge, but with some good advice and some good habits, you can do it.

Cruise on over to the contact page and send me an email. I work with some excellent lenders and would be happy to connect you with the right people. You might be surprised as to how quickly you could become an owner!

Curtis

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12 Feb

Posted at 12:15h in Buying a Home by
How much do you think they’ll take for it? It’s a great question and one I get asked all of the time. Here’s the answer: How should I know?
 
Several years ago I was representing a buyer purchasing a condo in Windsor Park. He had split up with his wife and was looking for something with enough room for his kids when they stayed with him.
 
We found a great place and made an offer of $247,000 for a condo priced at $259,900. We received a counter offer of $255,000. This was more than my guy was willing to pay and he asked me if I thought they might take something in the low $250’s.
 
As are the rules, when an offer is made and a counter offer presented a buyer cannot then counter the counter offer. If the buyer wants to pursue it further they need to re-open negotiations with a new offer.
 
I called the listing agent first to see if we would be wasting our time writing a new offer or if there was room to move, responded flatly “how should I know”.
 
How should I know? You’re her REALTOR®, don’t you guys ever talk. Then I thought about it some more.
 
First of all, the answer I got was partly self-serving on the listing agents behalf. Instead of getting on the phone with the seller he wanted me to write a new offer. This way all he had to do was email it over to her and he was done for the evening.
 
But, I could also see he was right.
 
Realtors don’t know what people will take for their home. We can gather clues as to motivation from past conversations but we don’t own the home. People don’t always do what’s good for them. Selling is an emotional time. Have you ever got caught up in situation and made a decision that, looking back on, wasn’t your finest? People blow it occasionally, sometimes more so when money is involved.
 
A better question, and one that I can answer is “how much should they take for the home”. Base your buying decision (in part) on how much a home should sell for and not what the seller is asking. What people should do and what they actually do doesn’t always line up.
 
Instead of getting angry with the Realtor, which was my first reaction, I took it as an opportunity to learn.
 
We ended up getting the condo for $253,000. My guy still lives there.
 
 
Curtis
 
P.S. Whether you agree or disagree with this I would welcome your feedback. Let’s start the conversation and get you moving in the right direction.
 

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