Broker Best Practices: The Importance of the Re-inspection Prior to Closing

Re-InspectionWith nearly fourteen years as a principal broker, there are certain legal issues that arise on a fairly regular basis.  One of the most common is the buyer’s broker calling the seller’s broker after closing to report the sellers had taken items that were supposed to stay in the home after closing, or some of the work orders weren’t done or done correctly.

This problem is not easily remedied but can be easily avoided by advising your buyers about their options for re-inspection before closing.  Making this a business practice can reduce a selling broker’s risk of liability for failing to advise a client of their rights.

The NWMLS Form 22D states in paragraph 3 titled Property and Grounds Maintained, “Buyer reserves the right to re-inspect the Property within 5 days prior to transfer of possession to verify that Seller has complied with this Paragraph 3.”   This is the buyer’s chance to make sure the property has been maintained and that the attached fixtures and mutually agreed appliances are still there.

The Inspection Addendum states “Seller’s repairs are subject to re-inspection and approval, prior to Closing, by the inspector who recommended the repair, if Buyer elects to order and pay for such re-inspection.”  It would be a wise investment for the buyer to spend the extra money and have the inspector come back to ensure the work orders were done and were done correctly.

This is a best practice that should be incorporated into your business, and mentioned both at the time of signing and right before closing.  Your buyer will thank you and you will avoid a potential post closing problem.

 

 

Standards of Practice

Our Coldwell Banker Bain Standards of Practice, Item 2, states “Respect the limits of your own expertise.  Before doing business outside your usual market area or area of expertise, always ask, ‘What is the best for this buyer/seller?’ and act accordingly.”

 

As an example, one of my brokers, an expert on mobile homes in parks, had a buyer who was interested in a very nicely remodeled mobile home in a park.  During the inspection it was discovered that the most attractive renovations, including a garden window and carport, had been improperly installed and were literally compromising the integrity of the entire structure.  The cost to repair this was enormous, so the buyer moved on.

The very sad part of this story is this seller bought the home with those features already in place. She had an inspection, but the inspector was not aware of the importance of “attached” vs “self supporting” in mobile home construction.  He used the same parameters as if it were a stick built home.  And, the buyer’s agent wasn’t familiar enough to know it was important.

This doesn’t just apply to mobile homes, but any real estate situation for which you have not had training or experience.  You can see the potential liability of doing business outside your area of expertise.  Although, the idea of having an E&O claim on a mobile home-sized commission is particularly insulting.

If you have the opportunity to do a transaction that is outside your normal activities or training, resist the temptation to proceed.  You can refer it out or ask for help from someone who is qualified.  Give them half of the commission for their knowledge and training and you will learn from an expert and protect you and your client from potential problems.

Simplifying Customer Service

With the buzz about the importance of customer service, it is hard to define.  We know when we receive good customer service and when we have not.  More often we don’t than do.  In fact, most of us probably expect that.

Years ago I had two examples that helped define what creates a memorable experience. Also, when we can define what creates a good experience it is easier to duplicate.

After offering to take lunch to numerous teachers and staff at my granddaughter’s grade school, I walked into a local fast food restaurant ready to place my order.  I imagined the result would be somewhat like buying a “mystery gift” in the closeout bin at a variety store-you never know what you will see when you open the bag.

The age and maturity of the young clerk only reinforced my expectations.  As I apologized for the big and complicated order he proceeded to take notes and then checked with the kitchen staff to make sure each bag was complete with everything that particular staff member expected.  I could have hugged him.  When I got back to the school and we dug in-every order was perfect.

He exceeded my expectations.  Big time.

I worked with an broker who got many referrals from a new construction site where the site agent wasn’t allowed to do any off site business.  He did a good job for her, but there are many good brokers in our industry.  What set him apart was he often arrived at her site early, set out her A-boards and had her favorite Starbucks ready for her when she arrived.

He knew women hate to set up A-boards-especially in the rain!  He anticipated her needs.  Big time.

So, if you anticipate your client’s needs and exceed their expectations in small ways they will be talking about you.  You will get more business.  It’s not that hard.

Landover Mortgage

Adapting to the ever changing market…

Landover MortgageIt appears we are just starting to recover from the most long and difficult housing market any of us have seen.  No doubt most of us have financial battle scars but it is a relief to think it might be ending.  But, it’s still hard.  Better, but hard.

The past few months have brought to light our next challenge.  Financing a home is far different than it was in the past. These changes are understandable in light of what contributed to the economic problems in the first place.

Lately, we have seen transactions fall apart at the last minute not because of the borrower, but because the home did not fit the cookie cutter criteria lenders want as they invest in a long term loan.  Banks and lenders are not public servants but businesses, and their profit margins, i.e. interest rates, are at record lows, making their position understandable.

There is far more scrutiny on every detail, requiring extensions that put everyone in the transaction on edge.  Many have not adjusted to or understand the reasons for this.

As we embrace our slow ascent into a healthy market it may be time to educate ourselves and our clients about the process for buyers as they obtain financing.  Schedule time with your loan officer and compare the “then and now” differences in their industry.  We still have information that is not available easily and it’s our chance to again show our clients why they need us.

 

How to Facebook

When the words “Facebook” and “business” were first used in the same sentence, we got an inquisitive gleam in our eyes and imagined the possibilities.  Agents started posting their listings—obnoxious.  Next came the Facebook business page—95.8% are boring (imho).

 

My next move was to reframe my time on Facebook as my “cocktail party.”  Comfortable clothes, perfect sipper, log on.  The time I spent on Facebook was connecting with my old classmates.  Wow-I appreciate and enjoy them way more as adults than as teenagers!  I reconnected with some beloved friends in Glencoe, Minnesota, pop. 5,000 (for the last umpteen years), and who have made a huge impact on me.  That, plus friends, family co-workers, beloved role models, etc.

 

I even set up a Facebook group for the Lake Cushman Homeowners.  Anyone who has owned property there is as mesmerized by the area as we.  Setting up a Google Alert for “Lake Cushman” seemed like a good idea so I would be the first to know what was happening in the area.  People started joining it and contributing to the information we all crave.  We have met new people and are connecting in ways our previous 20 years took far longer to enjoy.

 

Something very interesting happened within this past week.  We got a referral from a relative of a very dear friend we no longer see and she needs help possibly selling her house.  Then, we got a friend on our Group who is interested in a list/sell.  We never even asked for their business.  They asked for ours.

 

As we have matured as real estate brokers in the social media world we realize our marketing in that media can only be secondary to the entertainment, information and networking we provide to those with whom we connect.  Plus, it’s way more fun!