The Vast Majority of Home Sellers (80%+/-) are a Good Match For a Flat Fee MLS Broker
Copyright © 2014 - 2019 AUTHOR: Paul R. Marino, REALTOR®, e-Pro®
The power of example. If you owned an in-town property with a postage stamp sized patch of grass 10 feet by 15 feet, would it make sense to own the “John Deere X758 Signature Series 4-Wheel Drive Tractor” (list price $12,099)? Trust me, this is one very nice lawn mower. Or might it make more sense to buy the “Black and Decker MM1800 Electric Mulching Mower” (list price $199)? Hmm…can I call you back on that…I need to run the numbers.
You get my point. Buy what you need. Not what others think you need. First off, let me define some terms. By “Flat Fee MLS Broker”, I am referring to a licensed real estate broker that is offering to provide “a-la-carte” services you definitely need if you truly want to sell your home (like getting you into the local MLS, which, with few exceptions, essentially replicates to Realtor.com®, Trulia®, Zillow®, etc.), but also gives you the option and flexibility of passing on those services that don’t fit your specific needs. “Flat Fee MLS Services” are sometimes referred to as “Flat Fee Services, “Fee For Service”, “Entry Only Service”, or “Limited Service”. If you want to read a good summary of these types of services, a fine place to start is the US Department of Justice web site.
Let me describe when these streamlined services are appropriate, and when they are not. Because there are definitely circumstances when a “Full Service Broker” is the more intelligent choice, and is in your financial best interest.
THE PERFECT CANDIDATE FOR STREAMLINED BROKER SERVICES (Includes: “Flat Fee MLS Services”, “Flat Fee Service”, “Fee For Service”, “Entry Only Service”, or “Limited Service”):
1] You own a computer and a cell phone (if you really don’t have access to either of these, trust me, there are government programs out there that will help you). LOL.
2] You have clear and undisputed equity in your home, meaning you know definitively that the market value of your home exceeds the mortgage balance (don’t forget about that 2nd mortgage, or heaven forbid, a 3rd mortgage). This is why is it CRITICAL that you know as accurately as possible, “What the heck is my home worth?”. Want to know how to do this, read my earlier post: “How to Intelligently Determine the Market Value of Your Home”.
3] You are physically capable of moving about your premises, and even peeking into the attic or basement.
4] You are not averse to opening your door to Buyer Broker’s and their clients (who have of course been “pre-screened”). And by pre-screened, I don’t mean a casual “pre-approval” letter, saying that providing everything on the Buyer’s mortgage application “checks out”, they qualify. Instead, I am talking about a “bulletproof” letter of approval from the lender that definitively states the prospective Buyer is approved to purchase your home, because their income, credit, and assets have been confirmed before they even walk through your door.
5] You are reasonably available to show your home. Meaning, that when “ready, willing, and able” Buyers present themselves, are you able to let them through the door (with proper advance notice of course).
So…how did you stack up? Not too tough. This ain’t like joining The Marines. On the flip side of this equation is a calculation you must make to see if a “Full Service Broker” is the more intelligent way forward. Having been a REALTOR® since 1988 (experienced in auction and estate buys, renovation, rehabs, appraising, and brokering), I have extensive contacts throughout the state, and across the US (personally referred brokerage business in 14 US states and 2 Canadian provinces). My personal criteria when referring to a “Full Service Broker” include the following mandatory requirements:
1] Four year college graduate (now don’t beat me up here). With 1.2+/- million real estate agents and brokers out there, scattered across the US, I had to make the cut somewhere. Merely a screening device. Not to say there aren’t some very high caliber real estate professionals out there without a four year degree (there most certainly are). Hey, Bill Gates never graduated from college, but then again, he was admitted to Harvard.
2] Work full time in the field of real estate brokerage, and have a minimum of 10 years in the business.
3] Member of the National Association of REALTORS®, selected in large part because they subscribe to a strict “Code of Ethics”
4] Experienced in “Short-Sale” transactions. What are “Short-Sale” transactions? These are situations where the net proceeds from the sale will more than likely fall short of the combined mortgage balance. Meaning, the homeowner is “underwater”.
THE PERFECT CANDIDATE FOR A “FULL SERVICE BROKER”:
1] You DON’T own a computer or a cell phone (I don't believe you)
2] You DON’T have any equity in the home, and are selling in the hopes the mortgage lender may be willing to accept less than the amount owed when the home is sold. It takes a VERY experienced full service broker to handle this kind of transaction, which is why you want someone that has been down this road before, and knows exactly how to negotiate with the lender.
Don’t feel bad about being “underwater”. You’re not alone. I ran the numbers on the percentage of homeowners in the New Hampshire and Vermont combined market (essentially the jurisdiction of the NEREN MLS database) whose current market value is BELOW what they paid, and the number is a staggering 41.4%. This data is provided via the MARKETrends Premium subscription based data service.
3] You are physically incapable (either due to age, health, or other infirmity) of moving about your premises, and taking Buyers on a proper tour of your property.
4] You simply do not have the time to conduct showings of your property, either due to work commitments, overseas deployment, or some other reason that keeps you away from your home for extended periods of time.
There you have it. Be smart. Be informed.
