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Collaborating With A Seller Broker As A First Time Homebuyer March 26, 2009

Posted by minnesotarealty in MN Realty.
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It is essential to understand the steps in Minnesota home buying especially if this is the first time that you will purchase a new house. Buying a home usually involves working with a subagent otherwise known as the seller’s agent or seller broker. These agents are the ones who act as the seller’s representatives whenever closing a deal. As such, they are entitled to a commission in addition to rights and responsibilities towards the buyer.

Each state may have distinctive regulations when it comes to home buying. Similarly, the national law has certain prohibitions relative to it. As suggested by the author of the book “100 Questions Every Home Buyer Should Ask”, home buyers must make an effort to read thoroughly all the documents such as agent’s forms and disclosures before signing to fully understand the services being offered. There are several things that a seller’s agent may or may not be allowed to do in your favor:

The seller’s agent can present you with complete price lists of homes within your preferred area or location. “Comps” pertains to a compilation of similar homes in a particular area, the list prices, and listing information. The seller’s agent typically provides a ‘comps’ to ensure that a reasonable price is agreed upon during the negotiation process.

When you are still deciding, the seller’s agent cannot give you hints on what home to choose. The seller’s agent has the primary task of selling the home that is commissioned him to deal. However, he cannot insist or even suggest what home you should purchase. In the case that you like two properties and it happened that the subagent works for both sellers – you cannot be persuaded to select one over the other. In other words, only you have the power to decide.

The seller’s agent cannot point out defects in the home. The seller broker cannot say anything that would influence your decision to purchase, or not purchase the property. Any material hidden defects can be disclosed, but you will need to conduct your own research to find out if the home is in good condition.

The seller’s agent cannot make suggestions on the best offer for the home. It may be tempting to ask the seller what price you should pay for the property, but they cannot legally offer this information at any time during your communications. The seller broker has certain obligations to the seller, so this information may impede on that relationship.

The seller’s agent can ask you for referrals. Many seller’s agents are independent business owners and always looking for new clients. They do have the right to ask you to refer them to friends or family members, and will do everything they can to make your home buying experience a good one.

In home buying, it is essential to remember a few important things. It is a fact that seller brokers facilitate the home buying process. However, this does not always translate to giving you all the benefits in the purchase of your new home. So it is necessary that you conduct your own research and find a Minnesota real estate agent who can assist you or help you address your home buying concerns.

Will Real Estate Protect Your Money? March 3, 2009

Posted by minnesotarealty in MN Realty.
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Every one of us dreams of enjoying only the best things in life and many thinks that investing money in a Minnesota real estate is the perfect solution. Yet, it is also true that with the negative things perpetrated by the media – it seems a bit scary!

Never believe anyone that tells you an investment is 100% safe and smart. EVERYTHING that you do with your money has a certain amount of risk involved with it, even if it’s just putting bills under your mattress; speaking of which, let’s talk about what happens if you do NOTHING with the money you save (e.g., putting it under your mattress). That wouldn’t be very smart -fire, flood, theft, etc. could make your money disappear very quickly with no hope for return.

Here is another scenario: what if you opted to put your money in a bank safety deposit box? Would it be safer that way? Probably yes but only concerning its physical property. Remember that its buying power changes over time and that the bills you have are only worth the currency’s present value.

In the United States, the annual inflation rate is approximately 3 percent. In other words, the cost of commodities increases by at least 3 percent every year. Now, what does this imply on the money deposited in your safety box? Definitely, your purchasing power decreases at a fast pace.

Let us also look into savings account. Those with this mode of saving are lucky because the FDIC orĀ the Federal Deposit Insurance Corporation protects them. The risk involved is minimal as far as losing money is concerned. However, there is such a thing called inflation that even the best savings account in the world will have a hard time counteracting. Inflation can also negatively affect your savings account interest earnings.

How about stocks? I like to think of investing in stocks as investing in an “idea”. You don’t hold claim to any tangible item. You only “own” the fact that you have contributed funds to the “idea” that the entity you contributed your money to will somehow add value to itself and subsequently add a gain to the money you started out with.

Relatively, you also hold no control on said “idea”. Your chance of success cannot be told in advance either, since a number of factors that will come along the way have to be identified. Investing in stocks, I must say, can present a considerable amount of risk and can only be prevented if you decide to make it your profession or spend all your time doing research on the companies. This is the main reason why I am presenting the last and best option, the real estate.

What primarily distinguishes real estate from the ones mentioned above is its being “tangible” (this presupposes that you can experience it with all your senses: you can see it, touch it, and even improve it.) Likewise, the risk involved as far as losing the physical asset is concerned seemed distant. If it does, there’s a wonderful thing called insurance! Can you apply the same in the case of stocks? Your property’s value also grows with inflation unlike paper currency so you do not have to worry about your investment losing its purchasing power every year.

Finally, the best thing in MN real estate is that the return of your investment is intensified! To name a few, you get huge tax breaks, gained equity through renter-paid debt reduction, equity gained through improvements, and many other surprising benefits. Can real estate investment protect your money? While it is true that no investment is a hundred percent safe, with forethought, I can definitely assure you that this is where you’ll find the security you’re looking for.