Realtor Tom Quits the Business

Here Is What Happened

Monday January 26th - 9:43 - Tom, a Realtor in Sarasota, Florida, arrives at his office and is anxious to get to work. Afterall, he hasn't sold a home in over 2 months.

Monday - 11:24 - 11:39 - Becky lives in Wisconsin and is thinking about buying a beach front condo on Siesta Key. Her family has been vacationing on Siesta Key for the last 10 years and with the depressed real estate market Becky and her husband Joe feel that this is a perfect time to buy. She finds Tom's website and gives him a call.

Tom answers Becky's call with enthusiasm. Becky tells Tom about her desire to buy a condo on Siesta Key and that she and Joe plan to be there January 30th and 31st to look at condos.

Tom, "Have you been to Sarasota before?"

Becky, "We have been vacationing on Siesta Key for the last 10 years so we know it well."

Tom, "Great. Are you looking in any other areas?"

Becky, "Nope. We only want to buy on Siesta Key."

Tom, "What kind of condo do you want to own?

Becky, "We would like a 2 bedroom, 2 bathroom, on the beach and under $700,000. We also want something in good condition because we don't want to buy a project. This will be a vacation home for us and we want to just come down and relax. Do you think we can find that Tom?"

Tom, "Sure you can. This is a great time to be a buyer. I just ran a search and there are 45 condos that match your description on Siesta Key. I will need to parse that down for you since many of them are overpriced or not in a good condition."

Tom, "Are you working with any other Realtors?"

Becky, "No. You are the only one that I have contacted."

Tom, "Great. I would be happy to help you and would appreciate it if you only work with me."

Becky is impressed with Tom's market knowledge and attentiveness so she agrees to not contact any other Realtors. 

Tom, "Would it helpful for me to email you all of the properties for sale with your requirements?"

Becky, "Yes."

Tom, "Have you arranged financing yet?"

Becky, "Not yet but we are pretty comfortable that we can get financing."

Tom, "Perfect. Let me know if you need someone to work with down here in Florida. I have some good lenders."

Becky, "Ok."

Tom, "When are you looking to buy?"

Becky, "We can buy at any time."

Tom, "Is there anything else you absolutely must have in any condo?"

Becky, "I don't think so. A 2 bedroom, 2 bathroom condo on the beach, not a fixer upper and a good deal under $700,000."

Tom gets all of Becky's contact information and confirms the dates of her visit with Becky and concludes the phone call.

Tom thinks in his head - $700,000 x 3% = $21,000!

Monday - 11:45 - After hanging up with Becky, Tom searches on the Sarasota MLS for Siesta Key condos to email Becky. He spends 25 minutes going through all of the listings and narrows down the list to 31 condos. He emails Becky the list of condos.

Monday - 1:54 - 3:45 - Tom is back from lunch and starts working on finding the best Siesta Key condos for Becky. He makes calls to listing agents to ask about the condition of their listings. Becky made it clear that she didn't want to buy a project.

Tuesday January 27th - 10:15 - Tom receives an email from Becky. She reviewed all of the Siesta Key condos and made a list of her favorites. Becky asks Tom some questions about a number of properties.

Wednesday - 3:23 - 3-39 - Becky emails Tom and asks about a few properties that she has seen on his website. Tom looks them up on the Sarasota MLS and reviews the units. He has seen them months ago and doesn't think that they are a good fit for Becky. Tom is happy that Becky is doing her homework prior to her arrival. She is showing buyer signals.

Thursday - 9:23 - Tom doesn't have a very busy day so he decides to preview condos prior to Becky and Joe arriving on Friday. This way he can eliminate all of the bad ones. He makes appointments to preview 15 condos later in the day. He can't preview everything on Becky's list but at least he can remove some possibilities.

Thursday - 1:12 - 3:10 - Tom previews the 15 properties and eliminates 5 of them. Tom gets back to the office and sets up showings for Friday to show Becky and her husband 10 condos. 

Friday - 10:00 - Tom meets Becky and Joe at his office. They sit down for a few minutes in the meeting room to discuss what they were going to see.

Friday - 10:08 - 1:12 - Tom shows them 10 Siesta Key condos where they find two possibilities. After the showings they are all pretty tired. Tom takes them back to the office where they agree to meet Saturday to see the rest of the condos on the list.

Saturday - 10:00 - 1:09 - Tom shows Becky and her husband 9 more Siesta Key condos. They only liked one of them. They also went back and looked at the other two possibilities from Friday. After the showings Tom dropped them off at his office. Becky and Joe were going to go back to their hotel to relax and think about it. They promise to call Tom later that day.

Saturday - 4:23 - Becky calls Tom to tell him that they are still contemplating which one to buy. Becky asks Tom if they can write an offer over the email or fax because they won't be able to do it prior to leaving. "That is not problem" says Tom.

Monday - 11:07 - Becky is back home and calls Tom to let him know that they made a decision to buy the unit in the Palm Bay Club that is listed for $649,900. She asks him to dig up some comparable sales and anymore information that he can about the property.

Monday - 11:10 - 12:09 - Tom calls the Sarasota Realtor that has the listing and asks for the sellers disclosure. He also searches the Sarasota MLS only to find one recent sale in Palm Bay Club. He has to search other nearby comparable communities to help value the property. He locates 2 other properties that are similar and that have sold within the last 3 months. He emails all of this information to Becky and Joe.

Monday - 1:15 - Becky calls Tom to review the information he sent her and ask his opinion of an offer price. They agree that $595,000 is a good starting point. They work out the terms of the offer and Becky tells Tom to type up the offer. 

Tom, "Can you email me a copy of your pre-approval letter so I can submit with the offer?"

Becky, "We don't have one but I will call our banker now."

Tom, "Ok. I will type up this offer."

Monday 1:25 - 1:58 - While Tom is typing up the offer Becky calls their personal banker, Leroy. Becky explains to Leroy about their trip to Florida and desire to purchase a condo on Siesta Key. She asks him about financing the condo. After all, he works at a large national bank that originates mortgages in Florida. Leroy asks Becky numerous questions and plans to call her back after he runs her credit report.

Monday - 2:48 - 2:56 - Leroy, "Hi Becky, I ran your credit report for you and your husband and we won't able to finance that condo on Siesta Key." 

Becky, "Why not?

Leroy, "Well. A few reasons. Your debt to income ratio is very high and you have some credit blemishes. Our lending guidelines have changed over the lst 12 months. I am sure you have heard in the news about how much harder it is to get a mortgage."

Becky, "I have but I didn't think it applied to me. Are you sure that you won't be able to give me a mortgage?"

Leroy, "Positive. I am sorry."

Monday - 3:15 - Becky calls Tom to let him know that her bank will not be able to give them a mortgage. Tom gives Becky two lenders that he works with regularly and tells her to call them today.

Tuesday 11:09 - Becky calls Tom to give him the bad news that neither lender would be able to lend her money to purchase the Siesta Key condo. She and Joe will just have to wait until their credit has improved, they lowered their debt and have more money saved up.

 * Tom is disheartened, quits the business and gets a salaried job. *

 

Here Is What Should Have Happened

Monday January 26th - 11:24 - ...qualifying questions...

Tom, "Have you arranged financing yet?"

Becky, "Not yet but we are pretty comfortable that we can get financing."

Tom, "Fantastic. The lending world has been turned upside down recently so you may want to double check that you can get financing. Also, if for some reason we get into a multiple offer situation you stand a better chance of getting the property if you have financing arranged. I have had several clients find their dream home only to be disappointed when they find out that they can't get a mortgage to buy it or they lose out to a more prepared buyer. Would it be possible for you to speak to your lender and get a pre-approval letter before you arrive?"

Becky, "Sure. I will call today."

Tom, "Great. Here is the number to two lenders down here in Florida that I use regularly."

....more qualifying questions..."

Monday - 4:45 - Becky calls Tom.

Becky, "Hi Tom, I spoke with my banker and your two lenders today and it doesn't look like we will be able to buy anything. My husband bought a new Range Rover and our savings, home value and retirement account have declined recently. We don't have good enough credit and too much debt to qualify for a mortgage. I am sorry but we cancelled our trip to come down."

Tom, "I am sorry to hear that. Well, if things change in the future and you can afford to buy please contact me."

Becky, "We will. Thank you."

* Since Tom asked important qualifying questions he only wasted a few minutes so he moves on to the next client. *