The Real Estate Team: Why is the Right Team So Important to Your Transaction

I have mentioned before that buying and selling real estate in Hemet, CA is a team sport that requires skill, coordination and spirit - just like any professional or amateur sports team.  A team cannot function if it cannot coordinate its efforts, if it does not have the skill to play in their league or team spirit with a drive to be #1.

I have a friend, Joey Aszterbaum, one of my preferred lenders with Patrion Mortgage - a division of Altura Credit Union who uses the phrase, "His Success Team" to describe all of the people he surrounds himself with to conduct business

Real estate in Hemet is no different.  Not only does it take a realtor to buy or sell real estate, there are many other players, each of which plays an integral role in the process - a process that must be coordinated so the right player is on the filed at the right time.

For sake of this series of articles, I will consider the purchase team, since it is more complex - the sellers team has many of the same players doing many of the same tasks - but for this article, we will focus on buying real estate.

It should be pointed out that team members may work together, but each is either an independent business or an employee of an independent business.  If any tam member were to have a financial interest in another company that they refer you to do business with, they would have to fully disclose that under the Real Estate Settlement ProceduresAct, also known as RESPA

1.         The REALTOR® is perhaps the most important player to the buyer, because the REALTOR® is the individual that will have the most contact with the buyer - from the very beginning to the very end of the transaction.

I have used the analogy that the REALTOR® is to the real estate transaction what the conductor is to the symphony orchestra.  It is the REALTOR® who is constantly in the spotlight and is totally responsible for the outcome of each section of the orchestra as well as each individual player.

2.         The Loan Officer will be the second most important person in the formula to success.  It is the Loan Officer who will be called on to bring the money to the table, in a timely fashion.  The Loan Officer does not set the rules; he just follows them (or he goes to jail for mortgage fraud) and gathers the information required by the lender.  A good loan officer will have many resources available to obtain loans and will place a loan in a program that is best for the client - not the one that earns him the biggest commission check.

In addition to using Joey Aszterbaum, I have a back up mortgage broker, John Severino of Symphony Mortgage that is a very integral part of my Success Team.  The reason for two players is not to keep each of them honest, but rather because they each serve and specialize in different segments of the market.  As the Conductor of the Hemet Real Estate Symphony Orchestra, it is my job to go in the right direction and lead the Hemet homebuyer to the lender that will be the most responsive to the particular situation at hand.

3.         The Appraiser is rarely someone that you get to choose.  The typical scenario is that each lender has their list of approved appraisers.  Many times the loan officer is tasked with coordinating with the Appraiser and you may be able to influence the decision as to whom they will use.  As an investor, it is always good to have an appraiser available that you know will get the right job done.  As a consumer, it is more important that your loan officer is confident in the appraiser and that it will be honest, fair and come in where you need it to be.  A good REALTOR® will always have a referral to the best appraisers for the area the REALTOR® works.

4.         Escrow Company plays a critical role in each and every transaction.  Your REALTOR® should negotiate firmly with the other REALTOR® for selection of this vendor in every transaction.  A good Escrow Officer can make all of the difference in a smooth transaction closing on time and a total disaster.

Escrow in California may be a bit different than most other states in the country.  Here, escrow is responsible for making sure that all the terms of the purchase agreement are adhered to and that the funds are dispersed according to the contract.  The Escrow officer has a unique position in that they represent each party individually - the buyer and the seller.

Escrow is in place to minimize the potential for fraud, loss, theft, errors and even a conflict of interest.

When selecting an escrow company/escrow officer you should be looking for experience and not price.  In boom times, escrow offices sprout up all over the place.  Many realty offices will have their own in-house escrow companies.  I do my best to avoid these as a potential for a conflict-of-interest or preferential treatment to one party over the other. 

Although most escrow companies charge similar rates - typically a small flat fee and then so much per every thousand dollars of a transaction.  Some do charge a flat fee.  My advice is to never select an escrow company based on price - in case you may have forgotten, you get what you pay for and escrow is no different!

For real estate transactions in Hemet CA, I always prefer to work exclusively with Michelle Hewitt of Fidelity Title & Escrow; she can be reached at (951) 652-5522.

5. Title Company is another integral team member.  You should find one through your REALTOR®, as your REALTOR® will do consistent business with the Title companies and should know which one do what they are suppose to do and which ones don't perform at the speed you need.  Many an escrow has been held up due to a slow Title Company.

The Title Company will guarantee a clean title to the property when you take possession - meaning there are no liens or other encumbrances on the property that may come back and haunt you. 

Although, every now and then, something can go wrong.  I had my own personal experience.  My home is on an acre and a half - consisting of two different parcel numbers.  When we refinanced and set up a impound account for our taxes and insurance, it turned out they were only collecting the taxes on the larger parcel and not the smaller. 

Advance the calendar five years and Riverside County is now ready to auction my smaller lot - leaving me land locked.  Well, the Title Company stepped up and paid 5 years of delinquent property taxes and penalties to avoid the auction.

My choice for Title in the Hemet market area is Fidelity Title and Escrow with Mr. Mike McKinlay taking care of the needs of my clients.  Mike can be reached at (951) 852-2262.

6. Real Estate Attorney is an important team member for the real estate investor and less important for the family looking to buy a home to live in.  I say this because there is typically little to resolve in the purchase of a home that the REALTORS® can't work out with the help of their clients

A good real estate attorney can be instrumental in obtaining legal advice and creating strategy.

Remember, in California; only an attorney can give legal advise.  As your REALTOR® I can offer an opinion based on how I feel something may happen - but only an attorney can give you sound legal advise on the consequences and what to expect in the case of a dispute.  Nothing can replace a true understanding of the law and how it applies to your own unique situation.

A real estate attorney can also provide the investor or For Sale by Owner seller with the necessary legal documents to facilitate a transaction.  As a licensed California real estate agent and member of the California Association of REALTORS® (CAR) I have direct access to an entire library of legal contracts and forms that comply with all of the necessary laws - both state and federal.  An investor working without a member of CAR (not all licensed real estate agents are REALTORS® or members of CAR) may not legally use CAR forms.

Because no one wants to use a lawyer because they are involved in litigation, it is best advised to seek one out early in the process of building a real estate business.  I can hear my Grandmother now, "An ounce of prevention is worth a pound of cure".

7. Home Inspector is a team member that you need to rely on.  If you are only involved in one or two transactions a year - either as a consumer or as an investor, then it is best to rely on your REALTOR® to select the home inspector he typically uses.  However, if you are involved in multiple purchases on a regular basis - find someone you know and can trust to deliver the unbiased analysis of the condition of the subject property.

A good home inspector will spend anywhere from an hour to two (longer for larger homes) and literally inspect every system in the home.  Any questionable items will be identified as well as those in outright need of repair.  The Home Inspector will also point out any code violations, based on today's building and safety code.

When the inspection is completed, you should receive a printed out report with a detailed explanation of the issues that were raised, including color photographs.  In today's era of technology, most home inspectors will also generate a version that can be emailed to you or accessed from a secure website. (Make sure you save a copy to your own computer, as it may not be available a year down the road.)

I suggest you make certain that you are at the property when the inspector is working and stay close to them.  This way you can see the thoroughness of the work they are doing and get a good feel for the home.  Certainly, at the end of the inspection, the Home Inspector should walk you through the entire home, pointing out every issue that they raised and the seriousness of each issue.

Most inspectors I have dealt with separate themselves from any conflict of interest by not making themselves available to do the work.  Then there are those investors who have a "go-to" guy that will thoroughly check the home out and then be paid a fee to correct the deficiencies. 

Know what works for you.

8. Insurance Agent is probably the most overlooked team player.  I can't begin to tell you how many escrows are delayed (never one of mine) because the new homeowner neglected to acquire the right insurance before the close of escrow.

You probably already have an agent for your existing home (if you are a homeowner) or even your automobile insurance.  Most companies offer multi-policy discounts, so make sure you ask and consolidate if possible.

When buying a home, you should let your insurance agent know with as much advance warning as possible.  No one likes to jump through hoops and obtaining the right policy for you will typically take a few days.

Insurance is similar to an attorney - no one want to ever use it, but it is nice to know they are available when the need does present itself.

A good Insurance Agent will also be your "go-to guy" if you need to file a claim.  Recently in our area, we had some 130 mph Santa Ana winds rip through portions of our valley.  A local agent who has space in my office, Chris Skeeters, was on the phone checking out his policyholders, initiating action on behalf of the company - great service is a great thing to find and should not be overlooked.  Like every other service you contract for, price should never be the deciding factor.

As an investor, you should consider an umbrella policy.  This is a policy that kicks in when the limits of your regular policy are exhausted.  An umbrella policy will not only cover you for losses on your rental properties but your primary residence, your vehicles and even business claims.  Umbrella policies are generally issued in $1 million increments and will typically run about $20 per month, per million - a small investment for the piece of mind they bring.

You may want to check with any Associations you may belong to for special packages.  I personally have a great policy through AARP.

9. Chattel Appraiser is definitely the most overlooked member of the real estate investor's team. Most people don't even know that Chattel is - because it is not a term used very often.  It simply means personal property - both the moveable and unmovable type.


As in investor of rental property, you should have the home appraised as soon as the rehab is complete - before your first tenant moves in.  The fee the Chattel Appraiser will charge will be nothing on comparison to the tax benefits you will legitimately be able to claim with his report.  If you are ever audited, then you know you will not have any issues with your properties and the tax deductions you have taken.

So other than your spouse or partner, you should have a solid team of seasoned professionals that you can call into action for the acquisition or disposal of your real estate investments.  As time allows, I plan on re-visiting each of these team members and expanding on the use of each and the criteria to select the best player for your real estate investing team.

Until Next Time, Have a Blessed Day,

John Occhi, Hemet CA REALTOR®
Mission Grove Realty

Author of "What You Need to Know...About Foreclosure and How You Can Stop It!" - If you are a Hemet or San Jacinto Homeowner please call (951-443-6259) for your free copy.

 This blog and the contents written here is the intellectual property of John Occhi, Hemet California REALTOR®.  The views and opinions expressed are just that - views and opinions of John Occhi and those who comment.  Please note that I am not an attorney or a tax professional and any time I discuss either topic, I suggest you consult with the proper professional for relevant assistance. 

This blog is part of the ActiveRain Real Estate Network, which is a social network highlighting the best of Web 2.0.  Information is provided with the intent of educating and assisting home owners, home sellers, home buyers and real estate investors with information the can be used to make better real estate decisions. 

I am proud to be a full time REALTOR® with Mission Grove Realty who is proud to be a contributing member of the ActiveRain community.