The Changing Face of RESPA

Provided By Julie Lane, VP of Legal and Compliance
Source Keller Williams Blog

Come January 1, 2010, the new and improved Real Estate Settlement Procedures Act of 1974 (RESPA) will be fully en force. Considering this is the first sweeping change in the home buying process since 1974, it is worthy of our full attention. The new RESPA means more than new forms-it means major changes in the way real estate closings happen.

The key motive of RESPA’s new rules is to make sure consumers understand loan costs and binding parameters before singing the closing statements.

With mountains of paperwork at the closing table, there is little chance that borrowers are going to spend the many hours necessary to wade through the documents. What’s more, borrowers, especially would-be first-time homeowners, may be intimidated by the process and miss the opportunity to seek competing settlement services that could save them money.

As a real estate broker, here’s what you need to know: the new rules may impact your ability to refer business to title companies, inspectors and others you typically work with as part of the sales process. RESPA wants to make it easier for borrowers to shop for the lowest-cost, most convenient closing services by mandating borrowers receive a written list of settlement service providers. That comprehensive list includes closers, appraisers, real estate brokers, title examiners, attorneys, underwriters, pest inspectors, mortgage insurers, loan processors and other settlement service providers.

Since borrowers will receive a laundry list of competing settlement service providers, they may be inclined to shop around for the best price, even if it only means saving a couple of hundred dollars.

This is the crux of the matter as it relates to real estate practices and comes in the wake of industry abuses. Some in the real estate industry have received kickbacks for referring consumers to mortgage brokers, appraisers and other professionals along the road to homeownership. In some cases, those referrals may not have been in the best interest of the homeowner based on price or serviced provided. In other cases, the real estate agency owned the title firm or the appraisal firm at non-competitive prices.

As we move into 2010, be aware of how you might violate RESPA to avoid any issues. The chief concern is giving the appearance of kickbacks, whether in the form of money, ownership interest, marketing help or other arrangements. There is a fine line between collaboration and violation of RESPA and it can be a complicated issue.

The good news is, HUD announced that that it will be lenient in the first 120 days of enforcement of the new RESPA regulations going into effect January 1, 2010 so long as good faith efforts are made to comply. Still, in order to avoid any confusion, you should consult with an attorney about full compliance with the rules.

Increase Your Distressed Properties Pipeline

Provided By Keller Williams Realty
Source Winning With Foreclosures

Short sales and foreclosures represent more than 40 percent of all home purchase transactions in the United States. For buyers looking to leverage current market opportunities, that’s a large pool of untapped homes.

The “Winning with Foreclosures” Seminar, PowerPoint and additional resources, is an opportunity to educate buyers on the benefits of buying a short sale or foreclosed property while positioning yourself as a local expert in this field.

Teach It:

The main tool in this kit is the PowerPoint presentation for your workshop session. In field tests, and at Family Reunion, the presentation took about 30-45 minutes to deliver. The presentation covers:

> Definitions – Basic definitions of key terms buyers will hear and need to understand.

> Benefits – The top three distressed property purchase benefits for buyers.

> Action steps – Five key steps that can lead buyers to a successful short sale or REO purchase.

> Rules of the Road – Rules of the road in buying—underscoring a number of key differences between traditional real estate purchases and short sale or REO purchases.

> Market Realities – How to seize the buying opportunity by understanding six key realities driving distressed property markets.

> Myths and Truths – Key myths about distressed properties—and the truths about these myths.

> Checklist – A short checklist buyers can use to tell they are ready to move ahead with finding and buying a distressed property.

> The presentation is designed to position you as the local expert in this field – and to involve participants in the workshop.

In addition to the PowerPoint Presentation, the following resources are also available to help you promote your “Winning with Foreclosures” Seminar:

> Flier you can customize to promote “Winning with Foreclosures” sessions you hold.

> Email header you can include in any email invitations or follow ups you send out about the workshop.

> 16-page attendee handout, filled with illustrations, headlines and bullet points designed to: 1. remind attendees what they heard in your workshop, and 2. prompt follow up with you about the possibility of buying.

Plug Into Your Profit Share

Provided By Keller Williams Realty

Source MyKW

For referrals that matter, seek recommendations that matter

Did you know? You can make a referral to any team leader in the Keller Williams Realty system. So, how do you begin growing your profit share tree outside your backyard? Think about the people you love and trust.

Where does your mother, brother or best friend live? Give them a call. Ask them, “If you were going to buy or sell a home today, who would you contact in your area?” If that person isn’t a Keller Williams agent, you’ve got a powerful opening statement to potentially initiate them on that path.

Give that person a call and say, “Hi, my name is Jay, and I’m in the real estate business out of Austin. I was just talking to my mother and she said that if she were to list her home today, she would list with you. That means a lot to me about the kind of reputation you must have in town as a businessperson who can get things done. I’ve just read a career-changing book by Gary Keller called SHIFT. It propelled my business in ways I didn’t expect. Would you like me to send you a copy?”

Then follow up. Add them as a friend on Facebook. Make a follow-up call. Ask the question, “I’d love for you to meet the team leader in your town. They are the best in the business and you just have to know them. Would it be okay if I asked Bob Smith to give you a call?”

For referrals that matter, seek the recommendations that matter. Look to your family members and friends who are beyond your backyard and power your profit share tree growth forward.

Want more tips like this one? Check out the entire archive of Profit Share Tips, more videos included!

The industry has spoken SHIFT is a national bestseller!

Provided By Keller Williams Realty

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No. 10

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No. 14

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Last month alone, more than 10,000 of your colleagues began reading and implementing the tactics from SHIFT. Did you? Click here to get your copy!

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Short Sale Offers and Contracts That Win

Published By Keller Williams Realty
Source KW Blog

Kevin Kauffman and Fred Weaver of Tempe, AZ (near Phoenix) live in the middle of one of the nation’s most distressed markets. In 2009, they helped more than 150 individuals and families avoid foreclosure with a short sale. They are among the select few short sale agents in America who close more than 90% of the deals they take on.

Today Kevin and Fred led a presentation on Short Sale Offers and Contracts That Win. Here are some of the things we learned in the session:

• The real estate boom of the mid-2000s was followed by a precipitous drop in values in many regions of America.

• Today, in half of all US states, 30% or more of all real estate sales involve a foreclosed or foreclosure-threatened property.

• This “distressed property” phenomenon first grabbed the nation’s attention about two years ago.

• The dramatic market shift continues—though recently, the first signs of “light at the end of the tunnel” appeared.

• One reason for the recent positive shift has been the diligence and passion of short sale specialist real estate agents. These professionals reach out to homeowners in financial distress and help them avoid foreclosure through a short sale.

Their secret to their success:

• Attracting offers that banks accept the first time, and negotiating with the bank efficiently and effectively to close the deal.

• A high success rate closing short sales requires a great mindset—a determined, independent, and very well-informed agent and team.

• You must truly know the short sale process, and you must be familiar with the unique requirements of the different lenders you encounter.

• On the buyer side of short sales, you must prequalify the listings you show—by pre-screening the listing agent! You want to bring offers to agents who know the ropes and have proven track record of success—whenever possible.

• Present one and only one offer to the lender on a given property.

• Never take “no” for an answer!