Advice for Sellers

Experts recommend the following to make this a smooth transition:

• Children should only be told of a planned move once the decision has been made. Discussing the possibility of a move beforehand only causes unnecessary anxiety, according to many child psychologists.
• Minimize the stress your children feel when moving by getting them involved in their favorite activities – sports, academic or artistic – BEFORE the move actually occurs. Children can use the Internet to find out about their favorite activities, events or teams, as well as other interesting facts about their new area.
• Another way to help children adjust to a new environment is to allow them to become familiar with the area before the move occurs. Take a vacation, or short trip to your new location to allow them to get to know the area. That way, it will seem familiar and reassuring once they’ve moved.
• And finally, let your children stay with relatives or friends during the actual packing and loading process. That will relieve the stress of seeing their possessions packed into boxes and taken away.

Section 1031 of the IRS Code offers real estate investors a great investment opportunity to build wealth and save taxes. By completing a 1031 exchange, you can dispose of investment property, use all of the equity to acquire replacement investment property, defer the capital gains tax that would ordinarily be paid, and leverage all of you equity into a replacement property.

Replacement property acquired in an exchange must be of “like-kind” or similar to the property being sold. The following are examples of properties that could be eligible for a 1031 exchange:

• Single Family Rental
• Multi-Family Rentals
• Farms/Ranches
• Raw Land
• Retail Offices
• Motels/Hotels
• Golf Course
• Industrial
• Leases of 30 years or more

Properties NOT eligible under 1031 include foreign property and primary residences.

1031 exchanges are primarily designed for people interested in investment properties, not for typical home sellers and buyers looking to purchase a residence.

Stop by your local post office to pick up a change of address form so your mail will be forwarded to your new home. If you’re not sure of your next permanent address, consider renting a post office box for a few months to guarantee your mail delivery will not be interrupted.

Be sure to notify anyone who provides you with service at your home that you are moving – landscapers, home cleaners or window washers. If you are moving out of the area, ask for recommendations of service providers you could use at your new home.

It’s time to decide now which belongings have sentimental value, and which you can part with. Set a weekend aside to have a moving sale and arrange for a local charity to come by and pick up whatever doesn’t sell. This will make it much easier to pack and will also save you money, since movers generally charge by the pound.

Getting started on these activities will ensure that you and your family experience a smooth transition to your next property.

Give children a job to do during moving preparations. Boxing up their books or toys gets them involved with, and excited about, the move.

Exchanges usually involve slightly greater costs than sales, so not every transaction should be an exchange

Your personal tax advisor can offer information specific to your situation and help you determine if a 1031 is right for you.

Don’t pack your child’s security blanket or other favorite toy. It should travel with your child instead.

Moving during the middle of the school year allows your children to make new friends right away.

Look for the word “REALTOR^®”
The first factor to understand is the difference between a REALTOR^® and a real estate agent. The word “REALTOR^®” can only be used by professionals who are members of the National Association of REALTOR^®s.

In order to be a member, an agent must agree to abide by a strict code of ethics based on values of competency, fairness, and high integrity. Among other strict standards, REALTOR^®s can not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, or national origin.

An agent who has become a REALTOR^® has committed to a higher standard of service and professionalism.

Interview potential REALTOR^®s
When you meet a potential REALTOR^®, be ready to interview him or her just as you would interview any person you might be hiring for a job. Here are some good questions to ask:

1. How long have you worked in real estate? Is real estate your full-time job? Real estate is a complex business. Experience and commitment definitely count.

2. Are you a licensed REALTOR^®? Agents who cannot actually call themselves REALTOR^®s have not sworn to uphold the profession’s code of ethics. REALTOR^® members have access to all of the most current information and training on the real estate business. Members of the MLS (Multiple Listing Service) can search through thousands of properties to find a list of those that meet your specific needs.

3. How many buyers and sellers have you worked with this year? How many of them have “closed a deal” with you? “Closing” on a home means seeing the process through to the final details of the contract and the transaction. The average agent closes 10 to 15 transactions a year.

A REALTOR^® who closes on a lot of homes may be able to help you buy or sell a property much quicker than others. On the other hand, a REALTOR^® who only closes a few transactions a year may have more time to spend with you. The choice is yours.

4. Do you have any assistants who work with you? What do they do? Some REALTOR^®s have a team of staff people to help meet customers’ needs faster and more efficiently. If your REALTOR^® does enough business to have assistants, make sure that the REALTOR^® personally handles any negotiations including the contract and closing. It is perfectly OK for an assistant to handle paperwork and home tours.

5. Do you have any designations, certifications or special training? REALTOR^®s learn as much as they can about the real estate business with continuing education. Some kinds of education result in special designations for the REALTOR^®. For example, if you are interested in a historic home, there are agents who have special designations and understand the unique market conditions of the older home.

6. How do you stay in touch with your clients? If your REALTOR^® prefers to send e-mail, but you want to be called on the telephone, the two of you will need to work out an agreeable communication plan.

Choose your REALTOR^® carefully, but once you have chosen, stay with that person. Do not sign a buyer’s agreement at your first meeting with a REALTOR^®. Wait until you are certain you have made the best choice.

Why are there so many short sales? Many people have found that they are “upside down” in their homes because of the sharp drop in home prices over the past couple of years. Some of these same folks have come upon financial hardship for a variety of reasons including job loss, divorce, interest rates adjusting up, etc…

Why consider a short sale? A short sale is much less harmful to your credit situation than a foreclosure or a bankruptcy and completing a short sale can allow you to purchase a home much sooner than the other afore mentioned options.

What is the first step in completing a short sale? The first step is to hire a qualified real estate professional (or team) who specializes in short sales. In considering agents, look for prior short-sale experience. Short sales have proliferated only in the last few years, so it may be hard to find an agent who has completed any deals. You want to work with a team which demonstrates a thorough working knowledge of the short-sale process, one that can help you understand your options, answering any questions that you have and see if considering a short sale is what is best for your particular situation and who won’t try to take advantage of your situation or pressure you to do something that isn’t in your best interest. A qualified real estate professional can:

• Provide you with a comparative market analysis (CMA).
• Help you set an appropriate listing price for your home, market it, and get it sold.
• Put special language in the MLS that indicates your home is a short sale and that lender approval is needed.
• Handle the long process of working with your lender or lenders.
• Negotiate the contract with the buyers.
• Help you put together the short-sale package to send to your lender for approval.
  

Choose a real estate professional (or team) that is dedicated to helping you make the best of what can be a tough situation. As the seller of a short sale, there is no cost to you. The bank typically handles all costs associated with selling the home.