I hear way too many Realtors and investors tell me they missed out on a deal because the homeowner was “too close to foreclosure”. This is never the case! If you find a homeowner and need to delay the foreclosure so you can close the deal, you have options!
Option 1: Bankruptcy
While this will be a “credit hit” to the seller, bankruptcy is an option they can take to delay the auction. The good news is this can be done right up to the morning of the auction and can be done for free! The sellers do not need an attorney, however, you can not act as one and help them if you are not an attorney. But they should know that they can call the local Federal Bankruptcy Court and a Court Clerk will be more than happy to let them know which documents they need to download and file in order to prevent the foreclosure. This is known as the “emergency bankruptcy kit”. If they ask the Clerk for that, they will get what they need.
Continue reading “Foreclosure Prevention”
I give a lot of classes, including continuing education credit classes for Realtors, on the topic of “Sub2” — the practice of purchasing a home through the transfer of deed without paying off the existing liens. This is a way to assume someone’s payments without having to qualify with the lender and without taking the note out of the seller’s name. Attend a CE Class for more information!
One of the first reactions is that this must be illegal! Or the banks “don’t allow” that.
The truth is, it is perfectly legal and the lender cannot prohibit you from transferring your deed to whoever you want! More importantly, they cannot prohibit you from purchasing property “subject to” the existing lien.
Continue reading “Should I Be Afraid of the “Due on Sale” Clause?”
We like to think of the value of our house as whatever it would appraise for, comp for, or sell for on the open market. That’s never an exact number, but definitely a number that falls into a very small circle of values. We’ll call that value the “Appraised Value.”
That value, however, has a few assumptions built in. It assumes that the seller has a house that can be marketed to the world (put on the MLS) for an extended period of time and that buyers can finance the home in any way typically available to them (Cash, Conventional, FHA, VA, etc.).
In other words, the Appraised Value assumes the homeowner has the luxury of time and the house is both marketable and “loanable”.
Continue reading “What is a House Worth?”
As the broker for over 235 Realtors/Investors, I hear about
it when an agent thinks they are about to lose their commissions. I take these
concerns seriously and advocate for my agents and their rightfully earned fees.
However, there are some things you can do to help avoid someone trying to skirt
their contractual obligation to you and some things you can do to make sure
your Broker is better equipped to fight for that recovery.
First, show your value to your client. When a client sees
and hears what you are doing for them it is a lot more difficult for them to
justify, in their minds, that you don’t deserve the commission they agreed to
pay. You can start immediately at the first meeting and explain to them some of
the services you provide & their value:
- MLS market statistics that are only available to
licensed Realtors and not cheaply!
- Knowledge of sales process and required
disclosures…they could find themselves in hot water if they fail to perform
actions by a certain date or neglect to provide required disclosures.
- Ability to reach the broadest audience of buyers
via MLS listing and syndication.
- Security. Someone to watch out for their best
interests and removing the risk of attracting someone with bad intentions with
a FSBO sign.
- If you are a StepStone agent, then the added
network and knowledge of how creative and/or investor offers work.
Second, make sure the client understands their rights and
- Explain the commission rate, what an “exclusive
right to sell” is and make sure they understand you get paid even if they find
a buyer themselves.
- Educate them on what to do should a buyer, other
agent or other party attempts to contact or negotiate with them directly.
Ensure they know to direct EVERYTHING through you and they should never sign
anything outside of your direction.
- Let them know that if they have concerns with
your representation that they should bring it up sooner than later. Make sure they understand that claiming you
didn’t do your job as a reason to not pay you after they have signed a contract
will not hold water and you will pursue a commission.
Next, do your job right. Nothing is more frustrating to me
when trying to secure an agents commission when I discover they made an error
in their paperwork. Don’t get sloppy, ever. If you do, it’s Murphy’s Law that
that’s the one that will come to haunt you later.
- Properly execute a representation agreement.
Make sure it’s signed and dated by both parties with all blanks filled in.
- Uphold the requirements placed on you in the rep
agreement. Don’t delay in listing on the MLS unless the agreement says
otherwise. If it says otherwise, make sure you stay on that date or amend if
- Provide an Information About Brokerage Services
and have signed. Don’t forget to get one
from the other party to the contract if they are not represented.
- Get amendments signed. Don’t just make changes
based on a verbal or email correspondence.
- Stay engaged. Don’t let them have the excuse
that you didn’t do anything. Even if there is nothing to be done still reach
out to the client with updates.
If you’ve got yourself a slippery fish and think that your
client is trying to side step their obligation to pay a commission, take these
- Reach out to your Broker right away.
- Advise any and all parties you are aware of that
you have a listing agreement.
- Consider recording a Memorandum of Listing
Contract with the County. (Consult with your broker, first! There could be
legal ramifications for this action).
If you are a StepStone Agent, then know that I have your
back and will fight for you! Follow this advice and I’ll have a much stronger
case to make when the time comes!
Each year, in each of our four major markets, we get an incredible opportunity to take a tour of some of our agents’ projects. While we still have DFW to go, I already have learned so much from the incredible opportunity to learn from each other! Here are some of the highlights!
Continue reading “What I Learned On Our Project Tours!”
If you search the internet for “Should I get a real estate license if I’m an investor?” and you will find a whole host of lists of reasons NOT to get your license.
I find that most of those lists, though, tend to be based on rumor and “conventional wisdom” rather than facts or grounded in the law.
So here is my Top 5 Reasons an Investor SHOULD get a real estate license!
#1 Monetize More Leads
Leads are not cheap. And let’s face it, not every seller we meet is ready to make a deal that makes sense from an investor-perspective. But when you have a license, you can also revert to listing the property when investing doesn’t make sense!
Continue reading “Top 5 Reasons Investors SHOULD be Licensed”
For decades, Real Estate Professionals have had to choose between the path of being a Licensed Agent or being a Creative Real Estate Investor.
As a Real Estate Agent, you likely have been told that investing techniques are illegal or unethical. These myths have led to an environment today that has caused brokers to institute archaic rules on you such as a prohibition on wholesaling, listing your own property or wrapping “sub2” deals.
As an investor, it’s very likely you have been told that you should avoid getting a real estate license. You might have heard that by having a license, you will have to treat sellers differently which can cost you good deals. Or worse, that a broker will trap you into a J-O-B and make you show buyers around.
Continue reading “StepStone Realty: The Home of the Black Sheep”
Many of you have heard me tell the story of what Creative Real Estate Investing was like when I started, 15 years ago. It was very much an underground, unheard of business practice. So much so that it invited a lot of scams and unethical practices.
It should be no surprise, then, that Wikepedia, still today, defines Creative Real Estate Investing in the following way:
“Creative real estate investing is any non-traditional method of buying and selling real estate. Confidence tricks and pyramid schemes … have embraced the term, leading contemporary usage of the term to be synonymous with unscrupulous practices.”
To find out this is how the general public really thinks, we did our own survey. When asked what you think of when you hear the word “creative real estate investor” or see an “I Buy Houses” advertisement… the top answers that emerged were “Fraud”, “Scam”, “Greedy”, “Unprofessional” and “Uncaring”. Continue reading “Help us Bring Creative Real Estate Investing into the Mainstream!”
It’s not secret that StepStone has been enjoying tremendous growth over the past two and a half years. As of this morning, we have gone from 4 to 136 agents and now are in the top 4% of brokerages in the state of Texas! Thank you to all who have entrusted your license with us… it’s been humbling and yet exciting!
It’s time we take this brokerage to the next level for all of us! We know that making it in this business requires help. Now that we’ve grown into a large brokerage, it’s time we start giving our agents the tools and training necessary to take YOUR business to the next level.
Luckily, our size means that we have a very predictable income stream. We know what our revenue will be based on our number of agents, and therefore, what it will be in the future as we continue to grow. Continue reading “Own a Piece of StepStone!”
Phase I of the Captain Program was a pilot program that met with a lot of success (and some learning/tweaks). But we are excited to move into Phase II!
What is the Captain Program? The Captain Program is first and foremost a way for those more experienced with StepStone to introduce new Agents to StepStone.
Captains also help those who are newly licensed learn the mechanics of licensed deals. And they are there to help those who want or need it, to navigate investment deals.
Benefits to being a captain include:
· Education: Nothing will teach you advance skills faster than having to teach someone else. We don’t always have the best answer, but by working with you, we will learn and we hope the same is true for you by working with us. Continue reading “Join our Captain Program”