Today's news brings some distressing information from Arkansas pertaining to a real estate broker who was tragically killed showing a vacant home. Having been a real estate agent for ten years I understand the impulse to meet a potential client at a listing in the quest to make the sale. No one in the real estate industry gets paid until the purchase is under contract, the mortgage loan is written and approved, and the deal is closed. The need to pay the bills, get food on the table and keep the children in shoes looms large in the decision to show a property -- even to someone the agent has never met before. As the situation in Arkansas shows, this need can put agents in a situation that an spiral out of control with devastating consequences.
I am sure that many real estate firms around the country will be reviewing their safety practices in light of this horrible event. For my agent partners I would make a couple of suggestions:
1) Resist the temptation to show a home to someone you never met. If they tell you they have been pre-approved ask who the loan originator was that spoke with them and follow up with that person. While pre-approval isn't fail safe, if a buyer has produced paystubs, bank statements, and identification it does lower the risk. Due to the increased scrutiny on lending required by the Patriot Act, we are required to obtain picture ID, social security cards, and do a Home Land Security search form, as well as review discrepancies on credit. If the person is giving a false name or social security number the credit report should pick it up. The Federal Government takes questions of identity seriously, please take advantage of that fact.
mkg74.com
One of the practical effects this may have is that as an agent you may want to consider offering the buyer an alternative to online lending. you aren't going to get much information about a client out of an online lender. Most of the agents I know would prefer to deal with a local lender that they can count on to give them information pertaining to how the financing piece is coming along rather than try to find whoever it is in cyber space that you need to speak with in order to get the job done. If you are a buyer reading this, by keeping things local you assist the efficiency of your own purchase process. In my experience very few online lenders are going to give you a deal that is significantly better than what you can find in your own town. The advertising may not have anything to do with the actual loan you, the consumer is getting.
Lenders should be asking prospective buyers the hard questions about where they live now, where they have worked in the past - - questions that many real estate agents feel uncomfortable asking. Listen, I have no problem asking a potential buyer just about anything. Divorce, child support, the reason for the bad credit two years ago, underwear size - - you name it we have to investigate it. Because if they aren't really a buyer I want to know now and not spend a lot of time on something that is not going to be successful. I have to close loans to make a living, and you my real estate friends, have to have buyers who can buy so you can make a living too.
2) If you are an agent that does open houses as a marketing strategy, don't go it alone. Either take another agent with you or call in your favorite Mortgage Loan Originator to assist you. Buyers almost always have questions about interest rates, programs and the short term future of lending. Bring in an expert to help. It's safer and you are building what may be an excellent partnership.
Okay consumers, this next section is for all you, HGTV watching, that doesn't look so hard, do it yourselfers. Besides the fact that selling a home is in fact hard - -if it was easy there would be no real estate industry - - there are some things to consider besides the money you think you will be saving.
Would you allow a stranger that pulls up into your driveway access to your home? Think about that for a minute. Some stranger pulls into your driveway one evening and says, "I have always loved the way this home looks. Can I see the inside right now? I might want to buy it sometime." Would you let that person have access to your home? This person will be seeing the inside of your home, any expensive electronics, furnishings, where doors and window are, if there is an alarm system and what is even more terrifying, where your children sleep at night. Would you do that? My friends, when you choose to market your home by yourself that is exactly what you do. You are allowing perfect strangers whom you know nothing about into your home.
It is a fact that our community is small, relatively speaking. Maybe the chances of someone coming into your home to do you harm are less than what they might be in a larger city, but that doesn't mean it can't happen here. Many real estate agents I know can speak to a visitor that came to an open house that might not have been there to see the house. In my own case, working as a new home consultant I had a visit from supposed prospective buyers at the end of an afternoon that made the hair on the back of my neck stand up. In that case I thought they were casing the house for a potential hit and run theft rather than to do me harm -- but even the thought of that is enough that I don't want to let just anyone into my home. And folks, I know a lot about selling houses and could so quite capably myself but I would never sell my home without the able assistance of real estate agent.
The fact is that a home owner is even less likely to ask any qualifying questions to a potential buyer, thereby putting themselves at even more at risk. If you are a sell-it-yourselfer- consider the additional layering of safety that listing with a real estate firm gives you. If your agent is doing their job they will know something about who is coming into your home. No commission savings is worth putting your family at risk.
If you are a real estate professional, the commission isn't worth your life. If a potential buyer won't do what they need to do to prepare to go inside of someone's home - don't risk it -the red flags should be flapping at the top of the pole. Due diligence is a good rule for personal safety and the safety of your clients as well.
As a rule I don't view the world as a dangerous place, but there is no sense allowing oneself to become a sitting duck.
12thompson.com
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