The Homeselling Process

It can be daunting, but with my expertise and my company’sresources, it can be accomplished with the maximum of skilland the minimum of stress.

The Homeselling Process:Described and Demystified

Ryan Carson Office: 610-398-9888 Ext. 163Cell Phone 610-574-1451Fax 610-398-8106Email [email protected]

A Seller's Guide to Short Sales

WHAT IS A SHORT SALE?Short Sale: a term used to describe a property sale where the total sales proceeds areless than the total balance due against the property. This includes the cost of the sale (i.e. customaryseller closing costs, commissions, repairs, etc.)

Short Sales will require you to work with multiple individuals.Here is a helpful guide to know the role of each individual involved.

The Seller We understand this is a difficult time for you. To be successful,your full cooperation is needed.

The Lender Mortgage lenders of all types will be faced with a high volumeof non-performing loans on equity deficient properties over thenext several years.To a lender, a short sale is purely a matter of money.

The REALTOR® One of the most critical players of a Short Sale transaction. AREALTOR®, after identifying and qualifying the homeowner as acandidate for a Short Sale, is responsible for navigating throughthe process with commitment, patience and follow-through.

The Loss Mitigator A process to avoid foreclosure; the lender tries to help aborrower who has been unable to make loan payments and isin danger of defaulting on a loan.

The Title Company Escrow officers can identify and solve a wide range of issuesthat may come up during a Short Sale transaction.

The Buyer Every real estate transaction needs a Buyer to seal the deal. Inthe case of a Short Sale, you need the right Buyer - one who hasthe patience to stick through the obstacles that most ShortSales face.



WHY DO BANKS PARTICIPATE IN SHORT SALES?

� Banks participate in short sales to help homeowners and themselves preventforeclosures.

� Banks cooperate to avoid the costs associated with foreclosing, and thus themanaging and reselling of REO (Real Estate Owned) assets.

� Compared to foreclosures, short sales are less costly, less time-consuming andmore likely to see completion.

� The over supply of foreclosure properties is a financial burden against thebanks. Banks cannot afford to take back all of the foreclosed homes.

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WHAT ARE SOME OF THE BENEFITS FROM A SHORT SALE?

The Seller, Homeowner: The seller avoids the credit disaster of losing a home toforeclosure. It's viewed as the "responsible choice".

The Lender: By completing the short sale, the lender reduces the actual loss andeliminates the exposure to risk that goes with acquiring a property throughforeclosure.

The Buyer: The buyer that hangs in through the short sale process can get aproperty at a below market price.



WHAT IS LOSS MITIGATION?

It's a concept made up of two components:

� Limiting actual costs and expenses incurred by the lender on "at risk loans".

� Reducing the lenders exposure to risks tied to real estate ownership.

Each lender approaches loss mitigation with their own set of goals and priorities.Some will move aggressively to cut losses and limit risk by pushing short sale files toconclusion quickly. Others will proceed with caution on short sale files, placing ahigh priority on approving only those files with horrendous hardships and desperatefinancial circumstances. It all comes down to how a particular lender views the ideaof mitigating loss.

Each loss mitigation department will operate with slightly different policies andprotocols. Sometimes you'll be assigned just one case manager that you'll speak withall the time, other departments have a pool of case managers that work on all files inthat department. Each style of operation has advantages and disadvantages, butalways remember that the loss mitigator has a position of authority and you will bemost successful if you can accept the loss mitigator's style and approach.



UNDERSTANDING YOUR OPTIONSDepending on the seller's situation, there are many options to considerbefore attempting a short sale.

� Discuss your situation with the lender� Turn the home into a rental� Deed in lieu of foreclosure� Threaten to file bankruptcy� Stop making payments� List the property and negotiate a short sale

............................................................................................................................Discuss your situation with the lender - The seller should contact their lenderas soon as trouble arises. A lender may be willing to make accommodations if aborrower finds himself or herself in a difficult financial situation, particularly if it istemporary. The key is to let the lender know up front, before the problem becomestoo serious to work out with the lender. Lenders may allow borrowers to:

� Refinance� Reduce the payment� Defer the payment� Change the loan terms which includes renegotiating the interest rate,

monthly payment amount or maturity date, or waiving late payment charges.

If payments cannot be made in a timely fashion, lenders may extend the "graceperiod" and work with the borrower. Lenders may even agree to delay filing a Noticeof Default if, among other things, they feel they are informed about the borrower'sintentions. This may make it easier to sell the property, and may preserve theborrower's credit.

Turn the home into a rental - Is there the possibility of renting the property andpaying the difference between the rent and the mortgage payment and looking forother living options for the borrower?


A Seller's Guide to Short SalesUNDERSTANDING YOUR OPTIONS CONTINUED...

Deed in lieu of foreclosure - The borrower voluntarily delivers title to the lenderand the lender accepts it in full satisfaction of the debt. The lender then owns theproperty and can dispose of it as it sees fit. This effectively avoids the wholeforeclosure process and if the lender agrees to this, the homeowner would have tovacate the property and again, there could be significant tax implications to thehomeowner as well as their credit being compromised.

File bankruptcy - If the borrower declares bankruptcy, the foreclosure process istemporarily put on hold. However, the lender may request the bankruptcy court tolift the automatic stay with respect to the lender's loan and resort to its remediesunder state law, including foreclosure, if the lender can show justification toproceed. Some borrowers think bankruptcy offers the best way out, but theborrower's credit may be seriously impacted for many years.

Stop making payments altogether and stay in the property until the propertygoes through the foreclosure process. The timeline can vary, but generally, thetimeline does not begin until the lender feels they have exhausted all avenues forcuring the payment delinquency. Normally, this happens after the borrower hasmissed three monthly mortgage payments and the Notice of Intent to Foreclose hasexpired.

The borrower has probably been contacted by the lender several times prior tobeginning the foreclosure process. The official foreclosure process then begins bythe lender contacting a trustee and instructing them to file a Notice of Default. Thiscould take anywhere from 6-9 months, possibly longer. Once the NOD has beenrecorded it takes 120 days to complete the foreclosure process. The homeowner'scredit will be severely affected, however, they may have been able to stay in thehouse for many months saving their money by not making the mortgage payment toprepare for relocation once evicted.

List the property - Get an offer and negotiate the short sale with the lender(s).There is no guarantee that this will be successful and no guarantee how much timeand energy will be put into the process. If this is the choice that is determined to bethe least disruptive and the lesser of all other choices, then contact a REALTOR® who is a Short Sale Specialist to move forward.



CREDIT ISSUES

A short sale may have the least adverse effect on the borrower's credit status. Aborrower's credit may be adversely affected by any of thefollowing:

� Short Sale� Notice of Default being recorded� Deed in lieu of foreclosure� Foreclosure� Bankruptcy

............................................................................................................................SHORT SALE START UP CHECKLIST

Below is a list of what lenders are requesting:

� Seller Application:� Full Name� Address� Social Security Number� Employment information including salary� 401k and years of employment� Bank accounts including other investments

(i.e. stocks, mutual funds, other real estate, etc.)� Copies of your most recent paycheck stubs� Copies of your last tax return� Hardship letter explaining why the borrower is no longer able to make the

payments and any documentation to support their claim� Listing contract showing the house is on the market� Listing contract showing the terms of the contract


Your needs come first.

Our process of marketing your property must matchyour objectives, priorities and needs.

In order to best serve you, I will want to learn more about your plans, so please feel freeto ask questions and share your concerns with me. The following worksheets on the topicsoutlined below can help me understand your goals and help us build a strong workingrelationship.

• The agency laws that may apply as we work together in the marketing and saleof your property.

• The objectives you want to achieve from the sale of your home and the supportyou expect to receive from me.

• How the homeselling process should be tailored to fit the characteristicsof your property.

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The Homeselling Process

Selling a house typically includes many of the following elements.I will be your resource and guide every step of the way.

Initial Consultation• Determine your needs and priorities• Review “agency” choices and select appropriate working relationship• Discuss Marketing Plan• Establish pricing strategy

Design and Implement Marketing Plan• Complete home enhancement recommendations• Carry out scheduled marketing activities• Show the property to brokers and prospective buyers• Communicate with you on a regular basis• Monitor results of marketing activities• Modify Marketing Plan and Pricing Strategy as necessary

Review Offer(s) and Reach Agreement with Buyer• The Buyer’s Real Estate Professional presents the offer• Discuss and clarify proposed terms and conditions• Negotiation; possible counter offers• Reach final agreement

Complete Settlement Process (per purchase contract)• Deposit Buyer’s earnest money• Sign documents• Title search; preliminary title report to Buyer• Inspections• Removal of any remaining contingencies• Buyer’s final walk-through of property• Loan funding/balance of funds from Buyer• Record title• Relocation of Seller; possession property by Buyer

After-Sale Service• Help you find your new home, as needed• Assist you with relocation, as needed• Provide resources for other after-sale home owner needs

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Important ways to help promote your property

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Here’s how you can provide peace of mind to prospective buyers

Take these steps and you can enhance the salability of your property:

• Written disclosure

A written property disclosure statement will give buyersa clear understanding of your property and thesurrounding neighborhood.

• Home warranty

A home warranty can give prospective buyers peaceof mind by providing repair-or-replace coverage ofmajor home operating systems and appliances.

• Professional home inspections

Professional inspections, such as structural, roof and termite,will reveal the current condition of the property.

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. Discover property conditions before a buyer walks through the door

. Fix problem(s) and display receipts showing what repairs have been made

. Help prevent buyers from subtracting thousands for what may be a hundred dollarsworth of repairs

. Shop contractors to find the best price for repairs

. Set your listing apart from the others

. Demonstrate your motivation and strengthen your market position

Benefits of a Pre-listingInspection for Sellers

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How will buyers see your property?

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It is important for a property to makethe best possible impression on prospective buyers.

The following factors can interefere with a buyer’s appreciationof your property:

Exterior• Clutter• Lawn needs mowing and edging• Untrimmed hedges and shrubs• Dead and dying plants• Grease or oil spots on the driveway• Peeling paint• Anything that looks old or worn

Interior• Worn carpets and drapes• Soiled windows, kitchen, bath• Clutter• Pet and smoking odors• Peeling paint, smudges or marks on walls

A comparatively small investment in time, money and effort to removethese distractions can lead to strong offers from buyers.

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Show off your home –– every time!

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These tips can help your property make the best impressionevery time it is previewed by sales professionals

or shown to prospective buyers.

InteriorMake beds, clean up dishes, empty wastebasketsRemove clutter throughout, organize closets andcupboards; put away toysSet out “show towels” in bathroomsFreshen the air with potpourri or baked breadaroma; deodorize pet areasSet the temperature at a comfortable levelDo quick vacuuming and dustingArrange fresh flowers throughoutHave a fire in the fireplace (when appropriate)Turn off the television; play soft background musicOpen drapes and shades; turn on the lights

ExteriorRemove toys, newspapers, yard toolsand other clutterTidy up; pick up after petsPark vehicles in the garage or on the street;leave the driveway clearAdd color with flowers and potted plants

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You are the key playeron the homeselling team!

No one has a more important rolein the home selling process than you.

Here are some ways your participation can contribute to a successful sale:

Maintain the property in ready-to-show condition.

Ensure that the house is easily accessible to real estate professionals. (lock box and key)

Try to be flexible in the scheduling of showings.

When you are not at home, let me know how you can be reached in case an offer is received.

If approached directly by a buyer who is not represented by a real estate professional, pleasecontact me. Do not allow them into the property unescorted.

Remove or lockup valuables, jewelry, cash and prescription medicines.

If possible, do not be present when the property is being shown.

Securely pen up pets, or take them with you.

Be cautious about saying anything to prospective buyers or their agents that could weakenyour negotiating position, especially regarding price or your urgency to sell.

Collect the business cards of real estate professionals who preview and show your home, andpass them on to me.

Let me know of any change in the property’s condition that would need to be disclosed topotential buyers.

Be available to review with me the list price and condition of your property if it has not soldin a reasonable period of time.

Feel free to contact me at any time with questions or concerns.

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Scheduling Your Home to be Sold

Our Appointment Center is just one tool BerkshireHathaway HomeServices Fox and Roach, REALTORS® has to lead the way with technology.

Maximizing Your Home’s Showing Potential throughBerkshire Hathaway HomeServices Fox and Roach, REALTORS®

How this Works• Buyer’s Agent calls the Appointent Center to schedule showing.• Appointment Center calls you to confirm the appointment.• An email is sent to the Buyer’s Agent notifying the appointment has been approved and requests feedback after the showing.• Your Berkshire Hathaway Fox and Roach agent will receive an email confirmation of all appointments and showing feedback.• Get updates on the potential buyers’ reactions to your home, and pricing from your agent.• Your agent has the ability to respond to those potential Buyer’s Agents with announcements such as open houses, price improvements, concessions, etc, which could ultimately move a buyer towards making an offer.• Our Appointment Center is just one tool Berkshire Hathaway HomeServices Fox and Roach, REALTORS® are leading the way with technology.

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From offer to completed sale...

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When our marketing efforts bring forth a purchase offer,you can count on me to:

Negotiate the agreement• I’ll explain the offer to you and answer your questions.• I’ll help you determine the best course of action by pointing out potential advantages

and disadvantages of the offer and by clarifying the choices avai al ble to yo .u• I’ll prepare an Estimate of Net Proceeds based on the proposed price and terms.• I’ll negotiate through the buyer’s agent, and handle possible counteroffers, to reach

a final agreement that is favorable ot yo .u

Complete the transaction• I’ll explain to you in detail all the steps that will occur for a successful closing, and

answer any questions you might have.• I’ll work with the buyer’s broker, settlement officer, title officer and others to help

forwar .dgnivomnoitcasnartehtpeekdnaseitivitcariehtetanidrooc• I’ll monitor the progress of inspections, the buyer’s loan and other contingencies as

called for in the purchase contract. I’ll resolve questions or problems that mightarise, in order to ensure a timely c ol sin .g

• I’ll accompany the buyer and buyer’s agent during their final walk-throughof the property.

• I’ll assist you in handling details required for the completion of the transaction.• I’ll communicate with you on a regular basis so you can stay informed and

l .eremain as worry-free as po ss ib

Follow up after the sale closes• I’ll confirm that all your real estate-related needs have been met, and

provide information on service providers you may er quir .e• I’ll offer relocation assistance if you’re moving to a new area.• I’ll help you locate a new home if you’re remaining in the area.

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Homeselling Services Commitment

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Selling your property is an important decision. As your Berkshire Hathaway HomeServices Real Estate professional, my goal is to help you sell your property for the

highest price attainable, within the time frame that fits your plans, and to make the homeselling process as efficient and stress-free as possible. Toward that end,

I commit to you that I will:Communicate with you in a timely and efficient manner.

Identify your needs.• Consult with you to clarify your needs, expectations and priorities.• Discuss seller, buyer and dual agency alternatives and determine

how I can best work with you to achieve your real estate objectives.• Answer any questions you might have about the homeselling

process.

Develop and implement an effective Marketing Planfor your property.

• Design a Marketing Plan that is tailored to your property, inorder to achieve maximum exposure to prospective buyers.

• Share information about your property with the BerkshireHathaway professionals in my office, and other real estate professionals through the Multiple Listing Service (MLS).

• Install the well-recognized Berkshire Hathaway HomeServicesReal Estate FOR SALE sign (where allowed).

• Discuss how Open Houses may be an effective way to reachpotential buyers, and hold open houses as needed.

• Explain how written property disclosure, a home warranty andprofessional home inspections can enhance the salability of yourproperty.

• Seek buyers who are pre-qualified or pre-approved by a lendinginstitution, and require financial qualifying information on allbuyers submitting offers.

• Communicate with you throughout the marketing process.

Help you determine an effective Pricing Strategy.

• Explain how market value is determined, and discuss the role ofmarket-sensitive pricing in the successful sale of your property.

• Research and present a Comparative Market Analysis (CMA)showing recent real estate activity and trends, to help youdetermine a realistic listing price.

• Discuss financing options that will help attract potential buyers.

• Prepare a preliminary estimate of your costs and cash proceedsbased on the probable selling price and financing terms.

• Continue to monitor real estate market activity, and, if appropriate,recommend price adjustments to keep your property competitive.

Recommend steps to prepare your property for market.• Identify enhancements what will help your property make the

best possible impression on prospective buyers.• Advise you how to prepare your property for real estate

professional previews and buyer showings.Represent you in negotiations with prospective buyers.

• Review all purchase offers with you, and explain your availablechoices to accept, reject or counter each offer.

• Negotiate in your best interests, including the handling of counteroffers, to reach an agreement that is acceptable to you.Work to protect your interests through the completionof the transaction.

• Work with the buyer’s real estate professional and others to seethat all requirements of the purchase agreement are satisfiedand to help keep the transaction on schedule.

• Keep you informed of the progress of the transaction.• Follow up on any remaining details after the close of sale, and

provide you with information on relocation assistance oradditional services you may need.Other Services:

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––This is my commitment to you to ensure that I meet all of yourexpectations in the marketing and sale of your property.Prepared for:_________________________________________(Seller’s Name)

Prepared by:_________________________________________(Sales Associate’s Name)

_________________________________________(Company Name)

Date Prepared:_________________________________________

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The “Grand Opening” Open House

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The advantages? It’s a highly controlled marketing event.It creates excitement about your property.

And it creates competition among potential home buyers.

The Pre-Marketing Phase

• We stage the home for sale• We photograph the home’s key elements• We prepare brochures, mailers and

other advertising and marketing• We contact neighbors and invite them

to attend• We notify the co-broker agents via

email, courier service or hand-deliverflyers inviting them and their clientsto attend

• We notify all Berkshire Hathaway Fox & Roach sales associates in the regionvia email invitation

• We distribute a flyer to all Realtorsannouncing the Grand Opening andinviting them and their clients to attend

• Your MLS status will be active/noshowings until the Grand Opening

• To generate excitement, your home willnot be shown until the Grand Opening

• A special “Grand Opening Topper” willbe placed on your sign one week priorto the Grand Opening

Grand Opening Day

• Open House sign will lead peopleto the property

• Your Open House will be listedprominently on foxroach.com

• We will have a Trident Mortgage consultanton call and on site to provide mortgagecalculation sheets

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Documents

The Homeselling Process