Pay Now or Pay Later

By
Real Estate Agent with Bragg & Associates Real Estate, LLC

The market that I'm in is located close to a military base.  We have families moving in and out of our area on a regular basis.  This is a good thing and this is a bad thing.  

We all know why it's good, people moving in need homes to buy.  People moving out have homes to sale.  If you're in an area where there is a military base you know that there are a large number of homes purchased with a VA loan.  100% VA loans.  Great for the buyer, they can usally get into a home with very little money out of their pockets at closing especially when if the seller or builder they are purchasing from agrees to pay their closing costs.  

Now the bad starts.  The buyer plans to be in the home 2 maybe 3 years.  This is bad.  They have no equity in the home. This is bad. The home has not appreciated enough to cover the commission that they are going to need to pay if they list the home for sale with a REALTOR. Another bad.

No one told them this.  No one asked them how long they think they'd be stationed here. No one mentioned to them that the subdivision they bought in has 2 more phases that will be built over the next 3 to 4 years.  No one told them that when they got ready to sale they'd be competing with new homes in their subdivision.  

No one told them they would probably have to write a check at closing.  They didn't pay to get into the house, but now they have to pay to get out. 

The "no one" is the agent that sold them this house. The agent that ran all the way to the bank with the commission they received from original purchase is now the agent that is no where in site to explain to this seller that "now you have to pay".

Today, I was that agent that had to tell them, they have to pay.  I don't like it.  These folks are young they needed their agent to guide them 2 years ago.  Today they recieved guidance, I just hope I wasn't too late.

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Rainer
79,929
Daniel Sundberg
Crystal Springs Real Estate - Kentwood, MI
There isn't much more you can do.  Also in today's military, they do not know whether they will be at a station a year or a lifetime.
Sep 15, 2007 04:04 PM #1
Rainmaker
299,208
Kathy McGraw
CELLing Realty - White Water, CA
Riverside County CA Real Estate
My heart breaks for these families......it is pitiful that some agents don't complete their duties to the buyer....just get the sale ;(
Oct 20, 2007 06:34 PM #2
Rainer
63,553
Greg Fox
Realty World Wichita - Wichita, KS
Techy Broker in Wichita Kansas

A little devil's advocate here.  Sometimes, buyers/sellers have selective memory.  I'm not defending all agents, and all mortgage people.  They should do their part and make sure the buyer understands fully.  I've seen a few glaze over facts.  I've  also seen mortgage brokers ask how long they intend to be in the home.  Not only for appreciation, but because the VA funding fee escalates after the first use, and if they will only be in the home 2 or 3 years, there are lower cost ways to get into a home.

But often, the buyer thinks all of that "Small print" isn't important.  They see low interest, a payment they can afford, and "forget" they'll have to sell shortly.  Until the selling time comes, and they're faced with the small print they forgot about.

Kim, I know you do it right, and I'll bet there are times you walk away from a conversation thinking thy should've listened to me....

Nov 22, 2007 02:49 PM #3
Rainer
7,371
Kim Bragg
Bragg & Associates Real Estate, LLC - Augusta, GA
Broker/Owner, ABR, CRS, GRI, ePro
.....every day, Greg, every day!
Nov 27, 2007 10:52 AM #4
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Rainer
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Kim Bragg

Broker/Owner, ABR, CRS, GRI, ePro
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