All Forum Posts by: Irene Nash

@Andrew Yu, actually I should have been more clear. Based on what my lenders have told me here in WA:

- If they've passed Desktop Underwriting they are actually "pre-approved" because they've submitted their credit, income and asset info and it has been run through the system.

- If their info has also been reviewed and approved by a human underwriter (not the mortgage broker, an actual underwriter) then we refer to them as being "fully underwritten" . However, this is nowhere near as common and I wouldn't expect buyers to show up like that, it takes more legwork on the part of the lender for a potential contract that doesn't even exist yet. In very competitive markets as has been the case in the Seattle area we do try to get our buyers who need financing fully underwritten because of bidding wars and going up against cash buyers, etc., but it's definitely not the norm in many parts of the country and not all lenders are excited about doing it or have time to do it before the offer.

What Taylor and I were saying to look out for is when buyers have a letter (some lenders may say pre-qualified or pre-approved, so don't go by the letter necessarily) that doesn't specify that their info has been received and reviewed and approved (run through DU), because lenders will also sometimes just get the buyer's info verbally and issue a letter 'subject to review' of income, credit and asset info. That's the weakest scenario. (Doesn't mean buyers don't qualify, you just don't know if they do or not.)

That's why it really is always worthwhile calling the mortgage person and finding our for sure unless it is clearly stated in the letter. And sometimes the letter uses boilerplate language that sounds like 'subject to review' and actually when you talk to the mortgage person you find out all the info has been submitted and run through DU.

I hope this helps, good luck.

Are you asking if the earnest money still needs to be deposited even if the contract is terminated prior to the 3-day earnest money deposit deadline?

In WA state at least, my understanding based on my experience (I am not an attorney) is that if the contract is terminated prior to the expiration of Buyer's deadline to deposit the earnest money, Buyer has not defaulted by not depositing the EM because they were still within the guidelines of the contract at the time of termination.  Once the contract is completely terminated there would be no contract and therefore no requirement for Buyer to deposit EM. 

If the contract was terminated on Day 4 and Buyer had not deposited the earnest money then that would be a different question, seeing as Seller could make the case that Buyer had defaulted on the agreement.  (Regardless of whether or not Seller had told the Buyer outside of the contract that it would be OK.)

Obviously every state has their own language, this is based on my experience in WA state. Good luck.

I agree with @Taylor Pelzel, a pre-qual letter can often be generated after a conversation on the phone, while a pre-approval typically means the lender has actually seen and verified the information. The lenders I use usually reference two stages, first running the info through Desktop Underwriting (DU) to make sure it gets approved by the system, and then having an actual human underwriter review and approve the information.

What we often do as listing agents (that you could probably do since you're representing yourself, although the buyer may need to give their mortgage person permission to talk to you) is call the lender directly and ask if they've actually received the credit, asset and income info already, and if so, if it has been run through DU.  It's not that common in many areas to get through the actual human underwriter stage prior to getting an offer accepted, although in very competitive markets it's a plus for the buyer.

Note that some pre-approval letters use standard boilerplate language that makes it sound as though the buyer's info has not been verified, which is why it's always a good idea to speak to the mortgage person directly.

Is there anyone you can share some of the non-regular working hours with, i.e. trade off some weekends or evenings? I totally understand the need to not constantly be on call, especially when you have a child, and 7 days a week from 7 am to 11 pm is in my opinion probably hard to sustain without getting burned out. 

The logistical issue to get around is that many of our clients work 9 to 5, and sometimes houses absolutely need to be shown after hours or on the weekend or they will just go to someone else's buyer. Which is a huge waste of time for us if we've been showing houses to that client for weeks or months, and a disservice to our client if they miss out on their dream home.

I do know agents who don't work on a specific day of the week (I don't know anyone who takes entire weekends off), and I have yet to see any way to resolve that in a way that doesn't put the client at a disadvantage unless there is someone else available to handle things that come up that are urgent. 

So first, I think one thing to consider is how well you may be setting clients' expectations about your availability - are they calling you at 10 pm about things that could have waited until the next day? It's totally fair to tell people your evening hours are for your family unless there's a legitimate emergency.

And as far as working after hours and on weekends, if you can find someone (a newer agent who would be willing to do some legwork for a reasonable fee in exchange for being mentored by you?) who is capable of stepping in on a for-pay or time-trade basis, in my opinion that would be a good option to look into. I do think I would have lost money and clients if I hadn't been available during the off hours, seeing as so many clients work 9 to 5.  But if I had had young kids I would have made a much bigger effort to find someone to trade time with. :)  Good luck!

Hi Gerard,

Just a heads up to check with your brokerage regarding any policies they may have regarding the words used in your domain name. For example the two brokerages I've worked with are fine with agents having their own websites, but do not want the world 'realty' in the domain name or website title - or any other word that implies the agent has their own brokerage. (That might even be an MLS and not a brokerage policy - but either way, it's very easy to choose wording that doesn't create problems.)

Also you may already know this but a lot of agents don't so I'll just mention it, be sure to put your geographic location (i.e. city or cities you work in) in the title tag of the site, it's one of the most important site descriptors from a search engine standpoint. You can see what a page's title is by mousing over the tab of any website page that's open in your browser - i.e. BiggerPockets.com is "BiggerPockets: A Real Estate Investing Social Network".  A lot of agents put their name and "Real Estate Agent" or something along those lines as the title of their blog/site, but their prospective clients are searching for agents in a specific location and if you don't specify where you work there's nothing to distinguish you from an agent on the other side of the country. Same goes with titles of blog posts when location is relevant to the post.

Also you probably know this already but I sometimes hear from people who don't, so just in case, it should be readable in a normal way to a normal person, Google is very smart now and stuffing too many keywords into a title (or anything else) creates problems. Good luck!

Hey there, I think Express Copy https://www.expresscopy.com/ has good options and pricing. As far as the type of marketing, it depends to some extent whom you're marketing to and what the intent is. Are you trying to get listings in a neighborhood, do monthly follow-up to previous clients and sphere, etc.?

Hey there and congrats on being on the way to getting your license. After 19 years in real estate here are a few things that I think would have been helpful to me starting out:

- Realize that you're in two businesses - actually being an agent, which in my opinion requires a lot of important skills that are not taught in license school - and being a marketer, seeing as if you are not able to market yourself as an agent you will not get as many clients.

- As far as begin a good agent, if you can find someone who can mentor you (someone who's a good agent obviously :) then that is extremely valuable. For some reason it is just tradition that people get their license and then usually are expected to pick everything everything else up from trial and error, with maybe a bit of guidance if they're fortunate.

To me this is like having a doctor pass their boards and then saying to them 'Congrats, you'll figure out how to stitch up a wound and do a pelvic exam once you get your patient."  If you can find a good mentor early on who will teach you how to help your clients make good decisions and make sure their interests are well protected that is golden.

- When you're starting out it's easy to get overwhelmed, but I think it's really important to remember that with each contact and transaction you have the option of essentially putting money into a savings account with an insanely high rate of compound interest. That's because if you handle your marketing and follow-up and interactions correctly, you'll have a much higher rate of referral business, and that can turn one client into five clients really fast. (And each of those new five clients can each bring more clients - that's why I'm likening it to compound interest - but enormously better than you'd find in any savings account.)

- With that in mind, some ways to maximize that are:

1) Use an automated follow-up/contact system for prospects and sphere, whether it's a monthly postcard, a hand-written note, an email newsletter, a print mailing - something. I say automated because for me at least, if someone doesn't rip my marketing out of my hands and press 'click' or put a stamp on it, it will end up never getting sent out. I've thrown out more football schedule magnets and expensive client entertainment coupon booklets than I can even count because they expired. (Yes, I am a worst case scenario. ;) When you're new you might find you have the time, but seriously, eventually it's almost a sure thing you'll get busy and it'll fall by the wayside. Keep it consistent!

I say 'monthly' because even though 2 x a month is probably better, when we over-set our goals we tend to bag the whole thing. Try once a month and see how that goes consistently.

2) Don't default to working with clients in lower price ranges in the beginning, which is what many of us do early on. There's no reason to not target buyers at 50% or 75% higher than your normal price range unless you're already in a high range, and you're giving yourself a 50% or 75% raise when you do that. You can do that by holding open houses at those price points, or doing a mailing campaign to a neighborhood with decent turnover in that price range.

Usually these people are just as nice and easy to work with.  (If that price boost takes you into a different kind of market, i.e. from regular residential to waterfront, then there are certainly more things to know and that's kind of a different animal.)

3) Don't default to working just with buyers in the first few years, as many of us also do when we start. This is like saying, "I'm only going to put 50% of what I was going to put into this wonderful savings account."  Yes there's more to learn when it comes to representing sellers (if we do it correctly, that is, not just shlepping a house onto the market), but you'll have to learn it sometime and rather than waiting 5 years until your buyers are ready to sell, it makes sense to learn from more experienced agents as soon as possible.

Do everything you can to become familiar with listings, even if you start out just by touring a lot of open homes and looking at the agents' marketing pieces, the words they use in their marketing language, who takes the best home photos and how they do it and which photographer they use, etc.  

When you see a home listing come on the market, do a market analysis to come up with your own market value estimate (as if the sellers had asked you to sell it for them), then compare that with the list price. Track the property to see if it sells in a reasonable time or if it was over or underpriced. How did your price compare? I know this all takes time but when you're new you typically have more time, and knowing how to price correctly is crucial, whether you're working with buyers or sellers.

This means that when someone calls you to list their house you'll feel like you have a base of expertise to work from, rather than think (as so many of us have done): "Holy crap, what do I do now?"

4) Automate asking for referrals, if you do nothing else. This is so easy. It means putting referral language at the end of your email signature, and in your voice mail greeting. I have a tutorial on how to do the voicemail but I'm not a Pro member on here yet so I don't think I can link to it, if that changes I'll see if I can edit this post. 

The simple line (not mine, but I'm not sure I can mention whose line it is without violating terms of service) that says "By the way, I'm never too busy for your referrals" is so easy to say and to add to the end of your emails. Even people who love you will sometimes forget to refer you unless you ask consistently! (Not annoyingly, just regularly.) Most seasoned agents will know whose line that is and some may tell you it's corny, but in my opinion it's not and it works.

- Put 20% of your income aside for taxes, in a separate account where you never see it. Trust me, this is a good idea. :)

- Don't confuse perfection with excellence. Excellence is what we always strive for, perfectionism will kill your ideas and cause you to put off for years projects that would have greatly helped your clients and your business if they had been put into action 90% perfect.

- With that in mind, I recommend not spending weeks or thousands of dollars figuring out a logo, or even a website, and don't let those things hold up any of your marketing or interactions with prospects. 

One of the most successful agents I know started out new just at the beginning of the big recession when so many agents were about to get blown out of the water. She did well in part because she had a decent sphere and she's very good at articulating her value at open houses. (Not pushy, just nice and confident and competent.) She also, like me, stages and has pro quality photos taken of all her listings (not just the higher end ones, like some people do), and she's very good at pricing correctly.  And she also works extremely hard.

All this and her website still looks like it did 10 years ago, with only a 'coming soon' on the blog post page and a 10-year-old photo of herself. :) I'm not saying that's the way to go, but on the flip side I think new agents sometimes spend thousands on getting a logo and the 'perfect' website, and these things can take soooo looong....  So, something to consider before spending a ton of money and time on.

- Consider Facebook advertising to get clients, and learn how to use Calls to Action and opt-ins on your website, or even just a simple web page if you don't have a website, so that you can develop a relationship with people and follow up with them by email. (I don't think you have to pay someone a bunch to do this for you - FB advertising is cheap right now and there's information about how to do it online.)

Some examples of valuable items to offer would be a 5-day home-buying course by email that you put together (can be simple, just regular emails), or a downloadable checklist of things people should know when they buy (or sell) a home, or anything that would truly be valuable to you if you were in their shoes.  For ideas just think, "What would I need to know if I were about to buy or sell a home?", or, "What do I know, that they don't know, that they need to know (and maybe don't even realize they don't know)?"  

Getting found by search engines just by writing a good blog post is much harder now, in my opinion, and once you start blogging you need to keep blogging.... 

(My own real estate website does none of these things, by the way, but I'm not trying to get clients from it right now.)

Just remember, people need to know that they're signing up to receive home-buying/selling info from you in the future, and that should be disclosed in a friendly way on the sign-up form.

OK, I hope some of this was helpful, I know this was long but this is a topic I'm passionate about. I learned fast and ended up doing well in real estate but certainly had my struggles along the way, and looking back I realize I missed so many opportunities to put money into that compound interest account, partly from being scattered, or not knowing what I needed to be doing, or often from being a perfectionist and over-analyzing rather than just putting things into action. It really bothers me to see so many newer agents repeating the same mistakes and it has kind of become a mission of mine to do what I can to fix that. 

Best wishes in your new career, real estate can be a really fun and rewarding career (and challenging too, of course, but that's partly why we choose to go this path, right? :) I'd be curious to hear about any specific questions you have at all as you move forward.

Hi Matthew, it sounds like you are asking about two different things: Forming an LLC, and obtaining S-Corp status for tax purposes.

I am not an accountant but am a longtime Realtor so am giving you a 'layperson's' advice based on my own experience.

From what I've seen, one of the primary reasons for forming an LLC is for liability purposes. They are usually easy and inexpensive to create, in WA state you can create one online in 10 minutes. You can check with an accountant or attorney to get the pros and cons, but my understanding is that there is a big advantage in being able to limit your liability in this way.

Obtaining S-Corp status (while still an LLC) so that you pay yourself payroll every quarter has more to do with the tax implications, as you mentioned. I waited too long to do this because at the time I had an accountant who told me it wasn't worth making the switch until I was making $150K a year. The result was that I paid an enormous amount in self-employment tax for longer than I needed to. My current accountant says that at around $50K it is worth it, and I believe this person is a better accountant. As far as I recall it cost nothing to obtain S-Corp status.

I am not an attorney or an accountant, but I believe forming an LLC is pretty much a 'do no harm' venture, and as far as getting taxed as an S-Corp, definitely talk with SEVERAL accountants to get their opinions. Yes you will pay more for accounting fees if you have your accountant do payroll every quarter, but in my experience it has been well worth it and I would have been better off doing it much earlier in my career. Good luck.