Should You Buy a House With Termite Damage? Pros and Cons of a Pest-Infested Property

termite-damage

Picture this: You’ve found the home of your dreams, made an offer, and it was accepted—but during the home inspection you discover that the house has termite damage. Termites! This will very likely leave you feeling both concerned and disgusted.

If you’re a buyer, any infestation is disheartening. But should it be a deal killer? If you find yourself in this predicament, here are some things to consider.

Where is the damage located?

One major factor that can help you determine whether to move forward with the purchase is exactly where the damage is located. Trey McCallie,principal broker at Urban Toolbox Real Estate in Lexington, KY, suggests that a buyer can purchase a home with termite damage as long as it’s not in the floor joists or any of the main supports of the home.

The damage is considered minimal if it’s primarily on the surface of wood structures. Any deeper and you may have a seriously costly problem on your hands.

Are you a first-time home buyer?

Termite-ravaged homes will usually come with a significant discount, which can appeal to newbies, who are often looking for a bargain. But McCallie says first-time home buyers should think long and hard before purchasing a home with termite damage. Why?

“First-time homebuyers typically have very little savings to tackle a major structural issue, because they are spending most of their money on the down payment,” he says.

Are the causes of the infestation fixed?

Besides fixing the damage, buyers need to ensure that the seller has fixed the parts of the home that led to the infestation.

“For example, termites see wood in direct contact to the soil—like siding, stairs, or door frames—as a food source, an entryway into the home, and also as shelter,” says Jeff Fisher, a real estate agent at PropertySimple in Scottsdale, AZ.

He says that moisture near the home’s foundation, in the form of clogged gutters, broken downspouts, or overflowing AC condensation lines, which can all result in water pooling near the home’s foundation, should also be eliminated. “Overgrown vegetation, firewood, and other wood stored near the foundation can also attract termites and should be addressed.”

Can the damage be eradicated?

Most damage, when found, can be treated and fixed. It is possible for more caustic species like the Formosan termite to damage a house beyond repair if it remains untreated for many years, but situations like this are very rare, according to Orkin pest control company.

“The majority of termite infestations can be treated by a pest control company, giving you assurance that the infestation will be eliminated and that the home will be protected against future termite infestations,” says Charlie Jones, EVP of Operations with Arrow Exterminators in Atlanta, GA.

If the termite damage in your potential home is extensive, Jones says you should consider having a structural inspection performed by a licensed contractor to determine if the damage is cosmetic (Sheetrock scarring, pinholes in walls, minor baseboard damage) or structural. If the damage is affecting the house’s structure, it will be more expensive.

How are your bargaining skills?

A termite infestation turning up during a home inspection might seem like a bummer, but it can be used as a major bargaining chip to help you knock down the price of the home.

Randy Mintz, a real estate agent at R.E. Shilow Realty Investors in Baltimore, says that if a buyer is already under contract, it is in the seller’s interest to work out a deal, allowing the buyer to use the discovery of the termite damage as leverage to get a better price.

“Generally speaking, I would advise a client to go ahead and buy a house with some termite damage, but to use it to their advantage as a negotiating tool,” he says.

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6 Myths About Pests Your Exterminator Wishes You Would Stop Believing

exterminator-myths-mousetrap-cheese

If you hate creepy-crawlies, an exterminator can sound like your saving grace. However, these pest control professionals are not miracle workers. Even though they’ll show up to assess your situation, spray, or set traps, you also need to do your part to prevent an infestation.

But did you know that some of your bug-busting methods could be doing more harm than good? There’s a chance you’re wasting money on practices that will backfire or hinder your exterminator’s hard work.

If your exterminator had a direct line to your house, here are the myths the pro would tell you to stop believing ASAP.

Myth No. 1: Mice can’t resist cheese in traps

One of the most common myths in pest control is that cheese should be used to bait mice and rodents. But it turns out that mice like cheese about as much as your kids like vegetables.

According to a Manchester Metropolitan University study, mice don’t like cheese at all—in fact, they prefer cereal, dried fruits, and chocolate. And a nonscientific study by the BBC revealed that when given a choice, mice were most likely to choose peanuts or grapes, and never chose the cheddar. Have we blown your mind?

“The real down and dirty is that mice are nibblers and prefer grains, kibble, and items that can be easily nibbled on,” says entomologist Mike Duncanat Truly Nolen Pest Control. “Roof rats, on the other hand, prefer fruits and nuts. Norway rats, which are burrow rodents, prefer meats and fruit in their diet.”

Myth No. 2: A clean home won’t have pest problems

You definitely want to do your best to keep your home clean, but it’s a mistake to think that pests infest only homes that are dirty.

Critters aren’t just looking for loose crumbs or dirty dishes. Scot Hodges, vice president of technical services and professional development at Arrow Exterminators, says they are also looking for shelter and water.

“Insects will be driven inside your home due to too much rain or dry weather,” Duncan says. “They will use any crack or unsealed space around windows or doors to get inside.”

Insects can also catch a ride in on grocery bags, packages, luggage, or furniture.

Myth No. 3: Citronella candles repel mosquitoes

Mosquitoes can spread all manner of illnesses, including West Nile and Zika viruses, so you need all of the protection you can get.

“Citronella candles and plants have gained popularity as a mosquito deterrent for good reason: They smell good and they do have some repellent properties that may keep some mosquitoes away from your immediate surroundings,” says Nancy Troyano, entomologist and director of operations, education, and training at Ehrlich Pest Control. “But none of them can protect you from being bitten by a mosquito in the way that an EPA-approved insect repellent can.”

So how do you know your bug repellent is EPA-approved?

“Look for the EPA approval on the label, and search for active ingredients such as DEET or oil of lemon-eucalyptus,” Troyano says.

Myth No. 4: Over-the-counter sprays can do the same thing an exterminator can

It may be cheaper to treat an infestation with a can of bug spray from your local hardware store, but it’s not necessarily as effective as calling a professional. According to Troyano, well-intentioned homeowners can often make problems worse.

“These are often repellent products, which means that they are designed to repel pests away from an area,” she explains. “Using these products may indeed chase a pest out of one area, but send it scurrying to another area of your home, spreading the problem even further than its original location.”

These sprays address the immediate problem, but not the cause, making them a solution only for the short term.

Myth No. 5: Ultrasonic rodent repellent devices work

Who doesn’t love mess-free pest control? Nothing is simpler than plugging a device into a wall that sends out ultrasonic pulses that only mice and other insects can hear.

But according to Judy Black, vice president of quality assurance and technical services at Orkin, there is no peer-reviewed research to prove that ultrasonic devices do anything to repel any type of pests.

“While some pests do ‘hear’ in the ultrasonic range, this does not mean that they are repelled by sounds generated in those wavelengths,” says Black.

Tim Horgan, service manager at Debug Pest Control in Chepachet, RI, says some of his customers have had success with these repellent devices, but most people admit they don’t work.

“The devices might annoy rodents, but ultimately rodents will choose shelter over freezing to death, even if there is an annoying sound,” Horgan says.

Myth No. 6: Hedge apples can repel or control pests

An apple a day may keep the doctor away, but it definitely won’t have that effect on pests, unfortunately for those seeking nontoxic solutions.

“Hedge apples, also known as Osage oranges, have been rumored as a pest repellent, but there is an absence of scientific research to validate that claim,” says Black. “While insect deterrent compounds have been extracted from hedge apples in laboratory studies, there is no valid evidence to confirm that Osage oranges are pest repellents.”

How Much Does Probate Cost? Real Estate Fees and Other Expenses

how-much-does-probate-cost

Probate is the legal process of sorting and distributing someone’s personal property when they die. The last will and testament is taken into account and executed according to the deceased’s wishes. This often includes real estate, as well as other high-ticket items like cars or valuable jewelry.

But what happens when the deceased didn’t bequeath a home to an heir? Typically, this prompts a probate sale in which an estate attorney or family representative must sell the property to liquidate the asset and distribute the money from the sale to the family.

“A probate sale is the sale of a property after the owner’s death when the late owner did not specify an heir to inherit the property,” says David Reischer, a real estate attorney and CEO of LegalAdvice.com. “A property is relinquished to the court, which then appoints the closest living relative as the executor who will sell the house.”

How much does probate cost?

The overall cost of probate will vary depending on the estate’s value.

“Typically the cost will be from 3% to 7% of the estate plus various fees. I’ve seen estate costs from as little as $5,000 to as much as $50,000,” Reischer says.

If you’ve just been appointed executor of a home that’s going through a probate sale, here are the fees you should be aware of.

Attorneys fees

According to Chris McDermott, a broker at McDermott Realty in Jacksonville, FL, the biggest costs in a probate sale are usually the attorneys fees. However, these fees can vary greatly depending on the state in which you live and the cost of the asset going through probate.

According to Nolo, a legal website, the state of Florida, as one example, uses the following fees:

  • Value of estate up to $40,000: $1,500
  • $40,000 to $70,000: $2,250
  • $70,000 to $100,000: $3,000
  • $100,000 to $1 million: $3,000, plus 3% of the value over $100,000
  • $1 million to $3 million: $3,000, plus 2.5% of the value over $1 million
  • $3 million to $5 million: $3,000, plus 2% of the value above $3 million
  • $5 million to $10 million: $3,000, plus 1.5% on the value above $5 million
  • More than $10 million: $3,000, plus 1% of the value above $10 million

Court costs

Court fees are usually set by state law and will vary based on location.

“Typically, court fees range between a couple hundred dollars to a couple thousand dollars,” Reischer says. “A more complicated estate will require more paperwork to be filed and will thus be on the higher end of the range.”

Costs to secure the real estate/insurance premium

One of the first things the executor needs to do is keep all easily movable valuables—such as cash and jewelry—safe until they can be turned over to the people who inherit them.

To do this, they will need to secure the property with new locks or alarm codes, according to Matthew F. Erskine, managing partner of Worcester, MA–based Erskine & Erskine, which handles estate planning and trust administration.

“Also, call the insurance agent and add the estate as a named insured to the policy, both for the property and for any motor vehicles,” says Erskine, who estimates that this process will cost between $500 to $1,000.

Cost to make required repairs

If someone in the family wants to purchase the property, they’d typically buy it from the estate.

“This is less expensive than selling it to a third party,” Erskine says, “since they will be taking the property as is, and there will be no broker’s commission on the transaction.”

However, if no one wants the property, he says it will need to be prepared for sale. The cost to make repairs—both cosmetic or mandatory—could range from $1,000 to $50,000.

There are certain building and zoning code-based upgrades that are triggered by the sale.

“For example, an older house may have 40-amp or 60-amp electrical service, which is a fire hazard when you have a lot of electrical appliances, and will need to be upgraded to 100-amp service—and that may cost several thousand dollars,” adds Erskine.

Other considerations include removing hazardous materials like lead paint or asbestos insulation.

Cost of getting the property appraised

The executor will also be responsible for arranging an appraisal of the property which will determine the minimum price for listing the property. This can cost anywhere from $0 to $5,000.

“When there is a sale to family member, charities as beneficiaries, or the potential for a dispute on the value of the home, getting an appraisal is a must,” says Erskine.

Cost to have property cleaned out

If the house is going to go up for sale, the furniture and other tangible property will need to be removed.

“Often the family will assist with this, but there is always some stuff no one wants, so they’ll need to hire a service to remove the remainder and either buy it, donate it, or dump it,” Erskine says.

He estimates this cost to be between $750 to $1,500. Sometimes more.

“I once had an estate with a two-bedroom ranch where we had five full-size dumpsters worth of trash,” he says.

Carrying costs

It can take a significant amount of time to complete a probate sale.

“A probate sale can take up to six to 12 months to finalize, depending on the complexity of the situation and the size of the assets,” says Mike Hills, vice president of investment brokerage at Denver-based Atlas Real Estate. That’s why carrying costs like mortgage payments, real estate taxes, and utilities should be taken into account— they’ll all need to be paid during the probate sale.

Other fees

McDermott says you should also expect to pay 5% to 6% of the sale price in real estate broker fees. However, Erskine warns this amount could go as high as 10%. The executor may also receive a fee, which is usually set by the court.

“Also, title fees will cost 1% to 2% to conduct closing and issue title insurance,” McDermott says.

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4 Costly Real-Life Lessons Learned While Buying a Home

painful-buying-lessons

Buying a home is exciting for sure, but on the flip side, a whole lot can go wrong during the process—scary events that can quickly turn this American dream into an American horror story. As proof, check out these home-buying nightmares from people who want to share their anguish with the hopes that they can spare future purchasers the same fate.

Home staging … or hiding?

“We ended up buying what we knew was a nicely staged fixer-upper, but we had no idea really what we were getting into,” says April Daniels Hussar of Verona, NJ. “When we finally got the keys and moved in, we literally cried. There was a throw rug melded to the kitchen floor. And the entire house smelled like cat pee—something we somehow had never noticed until then. The sellers made very good use of candles and who knows what else! We had to redo all the wood floors.”

Lesson learned: Staging is supposed to enhance a home’s features, but it may also cover up its defects, says Colby Sambrotto, president and CEO of USRealty.com. He suggests going through a house several times before buying it.

“Accompany the home inspector when he reviews the house to see for yourself what may be lacking. Open windows, turn on every light, trace electrical and plumbing systems to their connections to the outside lines, and ask for receipts and proof of any claimed improvements.”

The house was great, but…

“We moved from an expensive housing market in Chicago to Knoxville, where we could afford a bigger house,” says Ali Wenzke of Chicago. “But just because you can afford it doesn’t mean you should buy it. We rationalized that this would be our forever home, so it was worth it. The problem? Our neighbors were all much older and didn’t have small kids like we did. We lived there for only a year and a half before loneliness forced us to move.”

Lesson learned: When house hunting, it’s essential to look beyond the house alone.

“It’s about your access to all the amenities that make life enjoyable in your new neighborhood,” says Sambrotto. “Think about easy and convenient access to parks, recreational amenities like running trails, daily shopping, and your commute.”

That power line will go where?

After searching for a home for nearly seven months, Kiki Roten of Canton, OH, and her fiancé finally found a little ranch house they loved. Then just four days away from closing, everything came crumbling down.

“We got the worst email you can imagine from our mortgage company saying our house suddenly sits in a ‘fall radius’ of an electrical power line, and we can’t buy it—even though we’d already invested over $1,000 into this house for home inspection and other fees,” she says. “By that point, everything we owned was packed up in boxes, and my bridal shower was two days away. I can’t make this garbage up. In one week, we went from on top of the world to crying in our bedroom, which was piled to the ceiling with boxes.”

Lesson learned: “Unforeseen circumstances do occasionally emerge to derail deals,” says Sombrotto. “Kiki’s situation underscores the importance of a land survey. For an existing home, you’d think that might be redundant: What could possibly have changed about a house that has been in the same spot for years? But even if property lines haven’t shifted, adjacent encroachments, like power lines, might affect the effective use of the property. A survey can also re-establish correct property lines if a neighbor has built a fence.”

Another way to head off last-minute surprises is with gap insurance as part of the title insurance coverage.

“This won’t go into effect until you’ve bought the house, but if any challenges to the title emerge in the few weeks that the deal is in process, gap insurance covers the fallout,” Sambrotto says.

You’ll need a permit for that

“I had an itch to find a little cozy cottage near the water,” says Melissa Shelby in Alexandria, VA. “Thinking I could handle things without a real estate agent, I examined homes and lots on my own, and found a cottage I had grand plans to renovate. Nevertheless, thousands of dollars and six months later, I still failed to obtain the right permits. And because of all these unforeseen costs, I resigned myself to doing much smaller interior renovations rather than turn this into the cottage of my dreams.”

Lesson learned: Shelby’s advice based on her own experience? “Find a trusted local real estate agent who is an expert in the area, as well as hire a permit runner or specialist who can give you very specific and accurate guidance on what to do to avoid permitting holdups that may decrease your budget for improvements,” she says. “Local zoning red tape can be unforeseen, costly, and, frankly, zap the joy right out of buying a home.”

First-Time Home Buyer Programs to Help You Afford a Mortgage

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Conventional wisdom says you need a 20% down payment to buy a house, but let’s face it: That sum can be daunting, particularly for first-time home buyers who don’t have a pile of cash from a property they have just sold. The good news is that the average down payment for first-time home buyers is actually around 6% of the purchase price, according to the National Association of Realtors®’ annual Profile of Home Buyers and Sellers. Even still, coming up with a decent amount of cash when you’re first starting out can be tough. Thankfully, there are a number of first-time home buyer programs aimed at helping you get a loan.

Don’t know where to start? No problem. To point you in the right direction, we’ve compiled a list of loan assistance programs you should check out if you qualify as a first-time home buyer.

Who qualifies as a first-time home buyer?

A first-time home buyer is not just someone who’s never purchased a home before. You could qualify as a first-time home buyer if you or your spouse haven’t owned a home in three years. The term also extends to recently divorced persons who have only owned a home jointly with a spouse.

There are some other limitations to who qualifies. You might not be eligible for one of these first-time home buyer programs if your income exceeds a certain amount, you want to buy a more expensive property, or you plan to buy an investment or rental property.

Now that we have the fine print out of the way, let’s look into some first-time home buyer assistance programs that might be perfect for you.

FHA loans

The Federal Housing Administration offers a program that allows first-time buyers to purchase a home with as little as 3.5% down. One caveat—and it can be a serious one—is the mortgage insurance requirement on an FHA loan.

Unlike a conventional loan, where you no longer have to pay mortgage insurance once you reach 20% equity in your home, FHA loans require you to pay mortgage insurance throughout the life of the loan at whatever the rate was when you first closed your loan (currently 0.85%), unless you refinance. Still, it’s hard to beat the low down payment for those who are short on ready cash.

VA loans

As a veteran or active service member of the United States military, you qualify for 100% financing with a VA loan, which means no down payment and no need to purchase private mortgage insurance. Most reservists, National Guard members, and spouses of military members who died while on active duty may also apply.

To qualify for a VA loan, you’ll need a certificate of eligibility and a good debt-to-income ratio, and you’ll have to meet VA and lender guidelines for credit score. Borrowers are responsible for paying a fee, but in certain situations (such as if you we disabled during your service) the fee can be waived.

USDA loans

Wait, the people who certify your beef can also help with your down payment? Yup! If you qualify for the U.S. Department of Agriculture’s Rural Development Guaranteed Housing Loan Program, you’ll receive 100% financing—no down payment necessary.

The properties must be in areas with a population below 35,000, so they are primarily rural areas, although some suburban areas could qualify.

These loans are available only to families demonstrating need—they are without current safe housing and have an adjusted income at or below the local limit. Keep in mind that the limit can be relatively high in pricey areas like California, where a $141,000 income can get you a USDA loan in some counties.

National Homebuyers Fund

The National Homebuyers Fund provides down payment assistance in the form of a nonrepayable grant, for up to 5% of the loan amount. You read that right—you don’t have to pay back anything. The NHF offers two down payment assistance programs with different sets of requirements, but both are meant for low- to moderate-income earners.

The NHF Sapphire program is available in multiple states and has generous FICO score requirements (which is a good thing if you have a subpar credit score). The Golden State Finance Authority Platinum program is available only in California and requires you to have a FICO score of 640. Ask your mortgage lender if this program would be applicable to you.

Local programs

Many states and counties have a wide variety of down payment assistance programs for first-time buyers. For example, the Colorado Housing Finance Authority offers a portfolio loan that allows a consumer to pay only 3% down and has no mortgage insurance requirement. While this program is specific to Colorado, many other states have similar products.

While these programs provide only down payment assistance, David Hosterman, branch manager for Castle & Cooke Mortgage, in Denver, recommends checking with your real estate agent for assistance in getting seller concessions to help with closing costs.

“In many cases, consumers can get into a house with no money down,” he says, although he cautions that there are still out-of-pocket expenses associated with buying a property, such as the appraisal and home inspection.

Many of these local programs have specific requirements, such as for the buyer to complete a home-buying class before obtaining the grant.

To find more information about loan programs for which you are eligible, check with your lender, and visit this HUD portal or list of state programsto see what might be available in your area.

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Home Buyers Reveal: ‘What I Wish I Had Known Before Buying My First Home’

things-wish-knew-before-buying

Love. Terror. Giddiness. Teeth-gnashing desperation. Buying your first home involves all these emotions, and more. And like so many other milestones in life, you won’t fully understand it until you go through the process yourself.

In an effort to clue you into some of the challenges you’ll face as a first-time home buyer, we asked some folks who’ve already gone through the ringer to spill what they wish they’d known earlier that would have saved them a ton of time, effort, and tears. Here’s to hoping their 20/20 hindsight will help pave your own path to homeownership.

Even if a home looks ‘perfect,’ it has problems

First-time home buyer Hunt Ethridge fell hard for a recently renovated house in Jersey City, NJ, which looked like it was in absolutely perfect condition. What could go wrong?

The home inspection, that’s what.

“My home inspector found a laundry list of issues,” Ethridge says. “He pointed out that the hardwood floor had been lacquered without sweeping, so dirt was sealed into it. Kitchen appliances were broken. Some windows were missing caulking. Worst of all was an old underground oil tank.”

After recovering from his shock, Ethridge used this info to renegotiate a lower price with the home sellers. He is grateful he didn’t pass on the home inspection and urges all home buyers to never skip this step.

“The last thing you want to discover after you buy is a major problem that could have been identified early on,” he says.

The takeaway: No matter how nice a home looks, a home inspection is the only way to make sure you aren’t buying a lemon, says Jane Peters, broker and owner of Home Jane Realty in Los Angeles. “You don’t have to ask the home seller to make repairs,” she adds, “but you do need to know whether you should proceed with the purchase or not.”

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Step away from the computer

Jonathan Cooper and his wife had a baby on the way, so they were ready and raring to buy their first home in Royersford, PA. They spent hours scrolling through real estate listings and Googling questions such as “how much home can I afford?”

This was all well and good, but at some point, a mortgage broker gave him some sage advice: “Stop Googling, move away from the computer and into the real world.”

Sure, online surfing and research serve a purpose, but if you’re serious about buying a home, “it’s not until you get pre-approved for a mortgage that the home-buying process gets real,” Cooper points out.

The takeaway: “You can’t get pre-approved by plugging in simple numbers on a mortgage calculator,” Peters says. “You need an experienced lender who will take a detailed history and require documentation of your assets and income. This is the only way you’ll establish if you qualify for a mortgage and for how much.”

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Never miss a deadline

When Steven Mingilton and his brother found the perfect condo in Denver and their offer was accepted, they wanted to celebrate. However, their lender informed them that the closing process would take about two months. “And within those 60 days, we had a hefty to-do list,” Mingilton says.

Mingilton and his brother struggled to keep up with the copious paperwork and nearly missed an essential appointment to complete their loan.

“We had to beg and plead our case,” Mingilton remembers. “Thankfully, we were able to hustle and finalize.”

The takeaway: “Buying a home requires you to stay on top of your to-do items, especially during the escrow process where there may be penalties for missing a deadline,” says Peters. “Prime among this is the three-day requirement to send in your deposit. Miss that and you may miss out on the deal.”

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Choose a lender you like

Newbie home buyer Aaron Norris loved the real estate agent who helped him find his Riverside, CA, residence, but his lender was a “total jerk.”

“I couldn’t believe how disengaged and unprofessional he was,” Norris recalls. “He wouldn’t return emails or phone calls in a timely manner. He dragged his feet on a transaction that required speed, and he simply did not communicate.”

Although everything worked out OK in the end, he regrets not shopping for a lender he liked: “I felt like I was working for him and that he was not on my team.”

The takeaway: “A lender can make or break a deal, so choose wisely,” says Peters. “One of the main things to look for besides the loan rate is the responsiveness of the lender. They need to move fast or the deal may fail.”

Here are some questions to ask mortgage lenders to help you decide which one is right for you.

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Summon reserves of patience

While hunting for their first home in Omaha, NB, Jordan Bath and her partner put in several offers on different properties—all of which fell through.

“At the time, it was a major disappointment,” she recalls. Their real estate agent kept advising them to be patient. Sure enough, after a year of losing out on properties, the perfect home fell into their laps.

“Our agent overheard a contractor mention he was doing work on a house in our dream neighborhood,” Bath recalls. “She asked him for the address and seller’s information, and we were able to purchase the house without it ever hitting the market.”

Now, Bath says, they can look back at those frustrating “misses” and realize “they weren’t meant to be.”

The takeaway: It’s tough not to get disheartened while house hunting, says Peters. “Competition is fierce, and you need to prepare yourself for the long haul.”

You may need to adjust your criteria so more possibilities are opened up. In the meantime, “keep making those offers,” Peters says. “One of them will get accepted.”

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What Is a Listing Agent? Why a Home Sale Hinges on Agent’s Expertise

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If you’re getting ready to sell your home, finding a listing agent should be at the top of your to-do list. But just what is a listing agent? You might have a vague mental image of someone who plants a “For Sale” sign on your front lawn and shows potential buyers around your place, but there’s plenty more to it.

Here’s a primer on what a listing agent does, how the agent makes or breaks your sale, and how to find a real estate agent in your area.

How listing agents help you price your home

How much is your home worth? That’s a hard question to answer. You can get an estimated value by entering your address on realtor.com®, but from there you’ll want to do some fine-tuning—and that’s where a good listing agent can help.

And the stakes are high: Price your home too low, and you could lose out on a lot of money. Price it too high, however, and the picture isn’t pretty either. While it may be tempting to work with an agent who says he can fetch a fortune for your home, overpricing may mean your home languishes on the market for months or even years—making buyers wonder if something’s wrong with your home and lowball you anyway.

“Listing agents have many duties and responsibilities, but at the top of the list is to properly price your home,” says Janine Acquafredda, a Realtor® with House-n-Key Realty.

To do this, a listing agent will analyze the sales prices of comparable homes, or “comps,” in your area to see where yours should fit in, and advise you accordingly.

How listing agents help you sell your home

After you determine an asking price, a listing agent should provide you with a comprehensive marketing plan detailing how she’ll get your property sold. This plan should include the following:

  • Recommendations for home improvements or home staging, if necessary. Yes, these alterations will cost you time and money, but they will improve your chances of a faster sale and higher asking price.
  • Taking photos or hiring a photographer who will be able to highlight your home’s best features.
  • Adding your home to the multiple listing service, where home buyers and their agents can view your property and decide if they’d like to come visit for a closer look.
  • Advertising and holding open houses.
  • Coordinating showings with prospective buyers.

How listings agents negotiate with buyers

Once you get an offer on your home, it’s the listing agent’s job to present it to you and advise if any haggling needs to be done. For instance, if you get an offer way below asking price, your knee-jerk reaction may be to refuse in a huff. But a listing agent might be able to negotiate with the buyers and bring that price up to a decent level—or, if the buyers truly can’t budge much, find other ways to sweeten the deal like a faster closing date or waived contingencies. These compromises can actually save you tens of thousands of dollars.

How to choose a listing agent

If you’re looking for a listing agent, you can find ones in your area at realtor.com/agentconnection, where you’ll find such details as their years of experience, number of homes sold, clients’ reviews, and more. Don’t just move forward with the first agent you meet. Choose at least a few and ask them some questions to assess whether they’re right for you.

Here are some questions to ask a prospective listing agent:

  • How many homes have you sold in this area, and how long did it take?
  • In what price range do you sell most of your homes?
  • Do you have advice for me about the condition of my home, and what could be improved to glean a higher sales price?
  • What is your marketing plan?
  • Can you recommend contractors, photographers, moving companies, etc.?
  • Are you a member of the National Association of Realtors®? (Realtors must abide by the group’s code of ethics.)
  • Is this your full-time job? (A part-time agent is not a problem, but you will want to gauge her availability during off-hours.)
  • How often will you touch base with me?
  • Are you planning any vacations, and if so, who will back you up?

How much listing agents get paid

Listing agents don’t receive a dime unless your home gets sold. If it does, the typical agent commission is 6% of the price of your home (which is typically split between the listing agent and the buyer’s agent). This price may seem substantial, but consider this: For every hour an agent spends with you, he will spend an average of nine hours behind the scenes working on your behalf. In other words, listings agents work hard to earn that commission and get your home sold.

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