Realtor.org are now offering scripts for realtors to handle all those difficult objections from buyers and sellers regarding the state of today's market. The scripts are so ridiculous that they are reproduced here with no more comment from me. Read and enjoy.....
Say the Right Thing
Use these scripts to handle the sticky questions from prospects and you’ll never be left speechless again. If you’re not prospecting because you’re not sure what to say, fear no more. Here are techniques for handling today’s most common objections from prospective clients.
1. “All I read about in the papers are how real estate prices are falling. Why would I want to buy now when I’ll be able to get a better deal later on?”
You: “It’s true that real estate prices have declined slightly nationwide in the last couple of months, but that’s after an increase of some 88 percent in the last 10 years. In fact, according to the NATIONAL ASSOCIATION OF REALTORS®, 2007 is the fifth best year in the history of real estate in the United States. You do intend to live in your new home for a while, don’t you?”
Buyer: “Yes, we want our 10-year-old to finish high school before we move again.”
You: “Even if home prices fall slightly over the short term, you’re still likely to come out ahead if you live in your home for eight or nine years, as you plan to do. Historically, housing prices have risen about 6 percent a year, according to NAR.”
(You should cite your own market’s price figures in this answer, especially if you’re in a market with stable or rising prices. If that’s the case, emphasize that all real estate is local.)
Buyer: “Still, it wouldn’t hurt to wait a while, would it?”
You: “One big reason to buy now is that interest rates are still near historic lows. But if oil prices and other rising costs push up inflation, as some economists think they will, interest rates will probably go up, too. That can make your monthly mortgage payment higher and affect how much home you could buy.
Buyer: “Yes, that’s a good point.”
You: “Another reason that it’s a great time to buy is that there’s a big inventory of houses to chose from right now. A couple of years ago, when the market was overheated, I had buyers who would just buy the first thing they saw because they were so afraid of not getting any home at all. Now you have the option of more time and a bigger choice so you’ll get the best home for you. And because of the large inventory, you’re in a better position to negotiate a price discount with the seller than you will be when the market begins to strengthen.”
2. “Prices are falling. It’s just not a good time to sell.”
You: “It’s true that home prices have fallen about 6 percent this year, (substitute statistics for your area), but that was after an increase of some 88 percent in the last 10 years, so you’re still way ahead.”
Seller: “I still think it’s best to wait until prices rise again.”
You: “If you don’t have to sell, of course, you have the option to wait, but because of the high inventory of homes, it may be a couple of years for prices to start going up again. Can you wait that long?”
Seller: “I guess we could, but we really hoped to move closer to our children in Texas and buy a house before next winter.”
You: “If you’re going to be a buyer, it’s a great time to sell because you’ll make up on the buying side what you don’t get on the selling side. In addition, interest rates are still near historic lows, which may not be the case too much longer, so more buyers will be able to afford your home.”
Seller: “You’re probably right, but what if my home won’t sell?”
You: “It’s true that the days it takes the average home to sell has gotten longer (use your market figures). But I’ve learned that no matter what the market, it takes the same three things to sell — presentation, promotion, and price. Just price your house right against your local competition, and you’ll be able to sell it in a reasonable amount of time.”
3. “My last sales associate had the listing for 90 days and didn’t do anything with it. So why would I want to list with you?”
You: “I know it can be frustrating in today’s slower market, since you want to sell your home promptly. What specifically do you feel your sales associate failed to do.”
Seller: “He didn’t advertise it enough, and he didn’t hold enough open houses.”
You: “That’s interesting. I know your sales associate, and I’m sure he worked hard for you. But maybe I can suggest a few ways that might help attract more buyers to your home. For example, I give each home its own dedicated Web site, which prevents it from getting lost in the high number of listings on the market today when it can take an average of 120 days (substitute local figure) to sell the average home.”
Seller: “That sounds good. What else would you do?”
You: I got a chance to look at your home when it was listed, and I think you could increase its appeal to buyers by using a professional stager. She would come in and spend a couple of hours helping you get your home buyer-ready. This wouldn’t cost you anything; it’s part of my service. I find those little extras are especially important now that your home will be competing against so many others for buyers.”
Seller: “I guess that’s not a bad idea.”
You: “If you’re still interested in selling, I have other suggestions of what I’d include in my marketing plan for your home that I’d like to share with you. Can we setup an appointment for me to stop by to go over them with you?”
4. “I can’t afford to use a real estate salesperson. I need every dollar I can get to pay off my mortgage loan.”
You: “So you’re really concerned about your net proceeds, right? What if I could prove to you that your net would be higher if you used a sales associate?”
FSBO: “How can you do that?”
You: “Research shows that in 2006, sellers who worked with a real estate professional sold their homes for an average of 32 percent more than homes that sold directly by their owners. So even if you pay me a commission, you’ll still come out way ahead. In fact, nearly four out of five people who try to sell on their own end up listing with a real estate professional. Do you have a moment for me to get some information about your home?”
(Ask questions to assess FSBO’s motivation, including “Where are you moving, and when do you need to be there?” If they can’t answer those questions, you’ve learned that they may not be motivated, and you can move onto FSBOs who are more eager to sell.)
FSBO: “You’re just saying that to get me to list with you.”
You: “Those statistics are all true. But I’m not here to list your home. I’m here to help you market your home. I’d like to give you a free brochure that describes some ways you can market your home more effectively. In exchange, I ask that you give me the names of people who look at your house but don’t buy it.”
Labels:
When the mess from the housing collapse finally clears, we will see that mortgage fraud was one of the main drivers behind rising prices. Easy credit made it easy to steal,
ATLANTA -- Skyrocketing foreclosures are a testament to how easy it was to borrow from mortgage lenders in recent years.
It may also have been easy to steal from them, to judge from a multimillion-dollar fraud scheme that federal prosecutors unraveled here in Atlanta. The criminals obtained $6.8 million in mortgages from Bear Stearns Cos., including a $1.8 million mortgage to Calvin Wright, a New Yorker who told the investment bank that he and his wife earned more than $50,000 a month as the top officers of a marketing firm. Mr. Wright submitted statements showing assets of $3 million, a federal indictment alleged.
In fact, Mr. Wright was a phone technician earning only $105,000 a year, with assets of only $35,000, and his wife was a homemaker. The palm-tree-lined mansion they purchased with Bear Stearns's $1.8 million recently sold out of foreclosure for just $1.1 million. Bear Stearns, meanwhile, posted the first quarterly loss in its 84-year history as it wrote down $1.9 billion of mortgage assets yesterday. (See related article.)
Fraud goes a long way toward explaining why mortgage defaults and foreclosures are rocking financial institutions, Wall Street and the economy. The Federal Bureau of Investigation says the share of its white-collar agents and analysts devoted to prosecuting mortgage fraud has risen to 28%, up from 7% in 2003. Suspicious Activity Reports, which many lenders are required to file with the Treasury Department's Financial Crimes Enforcement Network when they suspect fraud, shot up nearly 700% between 2000 and 2006.
In 2006, losses from fraud could total a record $4.5 billion, a 100% increase from the previous year, says Arthur Prieston, chairman of the Prieston Group, which provides lenders with mortgage-fraud insurance and training. The surge ranges from one-off cases of fudging and fibbing to organized criminal rings. The FBI says its active mortgage-fraud cases have increased to 1,210 this year from 436 in 2003. In some regions, fraud may account for half of all foreclosures. "We've created a culture where a great many people know how to take advantage of the system," says Mr. Prieston.
Labels:
Why are mortgages so complicated? In principle, it is just a long term loan used to buy real estate. Yet, mortgage products have become so complex that no one understands them anymore.
A recent study by the Federal Trade Commission confirmed some of difficulties that people have in deciphering today's mortgage products. The commission surveyed 819 recent prime and subprime mortgage customers in 12 locations around the country. The findings of the study were disturbing:
· Nearly nine out of 10 borrowers could not identify the correct amount of upfront charges connected with a loan.
· Four out of five could not explain why the stated interest rate on the loan note was different from the annual percentage rate, or APR, highlighted in the truth-in-lending disclosure.
· Two-thirds did not identify a potentially nasty trap lurking in the loan; a substantial penalty if they refinanced within the first two years.
· Nearly a quarter could not correctly identify the total amount of settlement costs.
Mortgage companies would argue that mortgage products now cater for a diverse customer base with different financing needs. However, this argument looks rather weak in the face of these survey results. If people don't understand the products, how can they identify which loan is best for them?
Labels:
In the midst of all this terrible news about the housing market, there is the occasional happy story of bidding wars and sellers getting more than their asking price. However, such stories should be greeted with enormous skepticism. Local newspapers have strong vested interests in the real estate market. Advertising revenues has meant that many local news outlets are so deep in the Realtors pockets that they can't see daylight.
The Washington Post is a particularly bad offender. The local housing market is deeply distressed. Yet the Post produces rubbish like the article below.
(Washington Post, May 19, 2007) He and his wife, Rebecca, wanted to sell their three-bedroom townhouse in the Del Ray neighborhood of Alexandria. They paid $430,000 in 2004. They were asking $499,000. Jim and Shane Fagan of Alexandria, shown with 19-month-old daughter Tate, recently got $16,100 more than they asked for their Del Ray townhouse. (By Katherine Frey -- The Washington Post) We were pretty apprehensive," he said. "All through the fall, we had friends in Springfield who couldn't sell their house. We watched the market. We read everything. We were hoping just to break even."
However, after just three days on the market in late March, they had five offers, one for $515,000. "This completely shocked us," he said. In a soft market portrayed so often in bleak terms for home sellers, the Casons are in a minority: sellers who get the asking price or more. Some real estate agents say that, despite key statistics that show the slowest housing market in years, they are seeing cases of multiple bids and rising prices. These seem to be concentrated in close-in neighborhoods including Del Ray, Bethesda and Chevy Chase (both sides of the Maryland-District line) and American University Park in the District.
Real estate agent Jane Fairweather of Coldwell Banker in Bethesda, who said she has had some multiple-bid sales in recent months, said sellers are adjusting prices to reflect a more reasonable market rather than the upward price spiral of previous years.
"I think the market is soft if you don't price it right," she said. "You're now seeing probably 10 to 15 percent of the sellers out there who are going to see multiple contracts.”Two years ago, it was probably 40 to 50 percent of the market that got multiple contracts. And the year before that and the year before that, 60 percent of the market got multiple contracts."
Economists in the Washington area have differing views of what this could mean. Peter Morici, an economist and business professor at the University of Maryland, sees a sign of a healthier market. "It indicates while we don't have a high-volume market, we have a market that has some stability. Fundamentally, [prices] are not a lot lower than they were at the peak," he said.
Labels:
Surprisingly, the housing bubble actually reduced realtor incomes. As house prices took off into the stratosphere, far too many rookie realtors thought that the market offered an easy way to make big money. However, the laws of supply and demand are harsh and unforgiving. Soon, there were too many realtors chasing too few sales. According to the NAR’s membership profile:
As such, there are too many realtors, suffering from declining incomes in an industry in collapse.
Hey! You've won a ride back to the top
1