Schroth Realty Group & KUDZU Realty Atlanta Real Estate

Tom Schroth East Cobb homes for sale start building your smart home

As someone that embraces tech and loves to use technology to simplify life, it was inevitable that I would be diving into home automation at some point. Also known as domotics, smart home or smart house, it’s been around for years. It not been until recently, IMHO, has it gotten the point where it had practical AND reliable applications. We are talking about more than dialing your phone with Siri or asking Alexa (Echo) the weather. I am talking about saving you time and simplifying life at a reasonable cost.

Simplifying is the operative word here. Too often new tech, while cool, brings with it lots of complexity and unreliability. Remember the first cell phones in the 80’s? The had to be installed in the car, you could barely get a signal and the cost to make a call… OUCH! But the 2 pound handset held up to your ear and that curly, pigtail antenna on your car showed the world you were really cool (unless they had one too, in which case they knew you were a poser).

If you’re are a techie then trying to make bleeding edge technology work has high entertainment value (My nephew). Most people want to plug it in a have it work and work every time. I have to say home automation is just about there in Sept 2017. I am going to take your through a series of posts that will outline my journey into domotics and how it has worked (or not worked) for me starting with a single problem I wanted a solution for.

Let’s see if home automation could save me from going up and down a flight of stairs to just turn on a fan.

Home automation Tom Schroth blog realtor east cobb whole house fanThe problem – I have a whole house fan that is located on the second level, a part of the house we go to maybe six times a year. For those who are unfamiliar, a whole house fan is a high capacity exhaust fan in the ceiling rafters that sucks air out of the house and pushes it into the attic. The idea is you open windows around the house in the evening and let the fan draw in the cool air and at the same time cool the attic off and reduce the latent, radiant heat that can keep the house too warm all night. You usually have it on for a short time up to a few hours. In my case the problem is not where the fan is located, its where the controls are… In the upstairs hallway. I know, boohoo, I have to go up the stairs to turn my fan on and off. But because of that we did not use the fan that much. It bugged me enough that I invested time trying to find a way to wire a remote switch on the main level. It was near impossible, short of opening up the drywall and creating quite the mess.

This is where I turned to home automation. I by started looking at remote control switches. Ceiling fans have remotes so there must be a way to remote control a simple 120V wall switch. While there were some solutions they were definitely “one offs” and not the clean solution I was hoping for. At this point I called my nephew for a consult. (I used to hand build HIS computers, now I ask HIM my tech questions). The consensus was home automation with a switch, and an app. But wait, you also need a hub and there were a half dozen brands and technologies. Simple went right out the window!

Home automation Tom Schroth blog realtor east cobb Samsung-SmartThings-HubWith spring coming and I wanted to use my darn whole house fan so I set out to get a basic system on the most common standard, figuring I could build on it in the future. I opted for a Samsung Smartthings based system that utilizes Z-Wave (common), ZigBee (not so much) and Bluetooth. I added a GE Z-wave wall switch and I was off to the races! I hardwired the switch, got the hub to talk to my wireless router, downloaded the app and voila, I had a remote controlled fan for $150… SO COOL!

Did it meet my test of simplicity and reliability? Well sort of. Not everyone can wire a 120 volt wall switch and the software setup was a little more involved than a router but it was not too bad. With the learning curve now shortened, adding more home controls was easier and less expensive, but that a story for another post.

Stay tuned for how I am bringing together home automation with my EXTEME DIY Media Room project and integrating Alexa (Echo) and Logitech Harmony remotes.

Do you want to get the most out of home ownership? Are you planning on buying or selling in the near future? Wouldn’t is nice to work with a Realtor that did more than just pass a test and actually knows something (a lot) about houses, remodeling and construction? Whether you are just updating and remodeling or buying and selling, I can likely guide you to the right resources and save you THOUSANDS, just email or call me.

Homeowner’s guide and review to cordless blowers…

ego-56v-blower-A practical cordless blower for homeowners has finally arrived! I see you out there shaking your heads. I was a skeptic too, having owned previous generations of battery powered cordless blowers, but the EGO series of cordless tools is the REAL DEAL! I can blow the drive and deck at my house in Roswell on TURBO speed (480 cubic feet per minute) multiple times before a recharge and when you DO need a charge, it’s less than 40 minutes.

My old Black & Decker (please forgive me for owning ANYTHING B&D, that was the only choice at the time) took overnight to charge and ran out in 5 minutes. Granted, there have been some better blowers by Ryobi and others. They were an incremental step at best. The EGO blower is a quantum leap. It has a huge 56 volt 2.0 amp lithium Ion battery pack. It will last for 30 – 45 minutes if you are not using the TURBO speed. It is light despite the hefty battery and well balanced. Overall, really well done. I have read many reviews and they mostly agree. The EGO battery powered blower is available at Home Depot for $199 (http://www.homedepot.com/ search for EGO) and you can find details at the company’s website http://egopowerplus.com/products/blower . Both my local Home Depot’s in East Cobb/ Marietta and Roswell have them in stock. Note that there are two version available now, one pushed a little more air. While I have the original (slower) version which I reference in this article, I would opt for the faster one just because bigger is better… right?

I also have a professional grade backpack blower but I only need to pull it out for fall leaf cleanup now. One of the BEST features for me is, I don’t smell like gasoline after using the EGO battery operated electric blower. If you have used a 2 stroke blower, you know how running it just a few minutes sends your clothes straight to the laundry. The oil used in 2 stroke pre-mix gets into the fabric and just won’t air out. My 4 stoke gas only blower is not as bad but you still take on the smell of the exhaust.

The Age of the Cordless Power Tool

EGO_Blower_Leaves-255×330The EGO is perfect for the average homeowner with regular clean up around the house. While you COULD clear off a small yard, you will do better with a heavier duty leaf blower for the large amount of leaves in the fall. The EGO has variable speeds and a TURBO button that takes you to top speed no matter what your regular speed setting is. I use it in my garage at the slowest speed to “sweep” the floor and then take it up to medium for the driveway. For the most part, I use high on the driveway, bringing on turbo for acorns. Having variable speeds make it easy to hit the inside corners of the porch and deck without too much blow back. Once you coax things away from the corners and out in the open you can crank it up and really let them have it with all 480 cfm.

With a corded or cordless electric blower you can give the deck or porch a quick clean and not have to change clothes. I use it daily in the fall wearing my work clothes before I pull out of the garage. I blow off the acorns so I don’t crush them into the concrete. Since its clean and quiet I take it to my homes listed for sale and do a quick cleanup if needed. All bets are off however, if it’s windy and you blow into the wind, you’ll get a nice dusting head to toe.

Very seldom am I this excited about a tool.. but in this case I say don’t walk, RUN to Home Depot and get yourself one! Looking for a great way to use that Home Depot gift card you got for Christmas gift? Stay tuned for a report on my EGO cordless mower.

Real Estate Mistakes
That Cost Buyer’s and Seller’s Money

  1. Not using a specialized local expert
  2. Using a part time or new real estate agent
  3. SELLERS – Not properly preparing their home BEFORE selling
  4. BUYERS – Not have a PROPER pre-approval or proof of funds

SRG-basic-Logo-(shadow)WEBI have been a full time real estate agent in north metro Atlanta since 1993 and I have to to be frank with you, not all “Real Estate Agents” are created equal. In our profession you get your license the day you pass the test. However, like any other profession, that alone does not qualify you to properly represent a client. It is both experience and time that do that.

Unfortunately, there is no apprentice program to help you learn the ropes with the guidance of a seasoned agent so during that learning curve you hope to not run into anything complicated.

new-real-estate-agentDid you know that the average real estate agent sells 2 -4 properties and makes around $7k – $29k a year after expenses? Ask yourself who you want representing one of your largest purchase or sale transactions?   When it comes to getting the best price and terms “Average” is not who you want negotiating on your behalf!

Let’s use an example of heart surgery.  In the medical field even though all doctors are called “doctors” they ALSO have other very important designations, such as “Pediatric Doctor”, “Adult Medicine Doctor”, ENT (Ear Nose & Throat) Doctor, etc.  Obviously there is a BIG difference between these different types doctors.

FYI: Did you know the “official” name for an ENT is “Otolaryngologist” Try say saying that 3 times fast!  Now you know why they are called “ENT’s”

choose-a-quality-agent

In addition, a Surgeon will be designated as a “Brain Surgeon”, “Heart Surgeon”  Vascular Surgeon”, etc.  These are sub-specialties and VERY important differentiation.

With that in mind (not to compare real estate with heart surgery), if you needed a triple bypass, although relatively common with a very high success rate, would you use a pediatrician? Of course not. Would you use a brain surgeon?  Well they are a surgeon but still not the best choice!  Of course you would us a heart surgeon.

Would you get the fresh new doctor right out of school or do you think you would prefer one that had a few years of “real world” experience under their belt? Do you want one that has an open schedule or the busy one that’s in demand?

Let’s consider something else, most doctors have privileges in multiple hospitals but do most of their surgery in one.  They are familiar with the surgical suite, the nurse, the techs, the admin personnel, the hospital layout, etc.  Wouldn’t it make sense to choose a doctor that was a regular at your hospital?

Let’s review each of the “Real Estate Mistakes
That Cost Buyer’s and Seller’s Money”

  1. Not using a specialized local agent: How can an agent get you top dollar in Roswell if they live in West Cobb or Lawrenceville? How can the educate buyers agents and buyers about your community? Plus, do you think they are motivated to drive that far to show you a house?  Why aren’t they busy? Even if they are REALLY good and familiar with the area, given the choice wouldn’t you go with the local agent specializing in YOUR area?
  2. Using a part time or new real estate agent: Some transactions are smooth and easy, some are difficult. The problem is you can’t tell until you are in the thick of it!  Just like a complication in surgery, if things go well then the new or part time doctor can get the job done… But what is something goes wrong?  Who do you want standing over you with a scalpel in their hand?
  3. Sellers – Not properly preparing their home BEFORE selling: Not preparing your home costs you money, simple as that. Buyers want new neutral carpet and paint, they don’t want a discount or allowance to choose their own. If your appliances, roof or HVAC is old they will discount their offer according. By the way, the average buyer discounts about twice as much as the real cost. So the carpet that you can put in for $5,000 could cost you $10,000 in discounts if you leave it for the buyer. Plus it will sell MUCH faster (9 out of 10 buyers want a turn-key house).
  4. Buyers – Not having a PROPER pre-approval or proof of funds: In this strong seller’s market you have to be ready to buy and have your funds in place. The better qualified and financially strongest often wins in a multiple offer situation and we have a stronger negotiating position. See this post for more on this.

sign-post-advice-help-support-tips-guidanceInsider Tip: Successful, busy Real estate agents don’t take a listing across town, they refer it to a local agent. Be careful of agents working ever angle out of desperation for a sale, any sale!

Buying a house on YOUR terms!

Be  prepared  to make your real estate  purchase  on your terms!

No matter what cycle the real estate is in, good houses priced right sell quickly. Buyers compete for the clean and up-to-date houses. If you are actively looking at homes to buy you owe it to yourself to be ready to strike when you find a house that meets your needs.

Being prepared  will save yourself a lot of aggravation, time and money. When you do the work up-front to prepare to make the purchase you are making logical, non emotional decisions that meet your real needs. This in turn allows you to buy on your terms, not the sellers.

Spend time to consider what you want. This is less about the house and more about your needs. Before you even look at a property take the time to write out a list of the outcomes that you want to achieve from buying a house. What will buying  a house do for you? What are the results you experience from buying a house?


It could be things like…
  • I want more time at home (a shorter commute)
  • I want a place my kids can go outside and play (a larger yard, near a park, etc.)
  • I want more privacy when at home (a larger house, a basement, different floor plan)
  • I want to spend less time and money on repairs (a newer house or condo)

Be sure this list is in writing and take a few days to go over it and revise it. This could take some work but it will help you select a house you can stay in for a long time. This will determine almost all the attributes of a house expect for how it looks.


Next, you need to look at your finances. You want to know what you are comfortable with in the terms of initial investment (down payment) and monthly payment if you are getting a loan. A mortgage broker is the best one to help you with that. This discussion should take place BEFORE you look at your first house. You want to determine a couple of things.

 What is the mortgage amount you can qualify for?
  1. What is the total monthly payment you want to have?
  2. What down payment is required?
  3. What down payment am I willing and able to put down?
  4. What is the PURCHASE price that meets those preceding criteria? (not loan amount)

 

Let the mortgage lender help you with the math to get to a bottom line purchase price for the house. Ask for the cost of money so should you want to buy a property a little higher or a little lower in price you can estimate the impact on your payment. For example, $10,000 at a 4% rate costs you about $50 a month. So  if you find a house you love but have to pay a little more you will know the impact on your budget. You can also use the mortgage calculator on my website to figure this out.

Now you are ALMOST ready to look. See my article on pre-qualification: http://schrothrealtygroup.com/prequalification-preapproval/

Assuming you have done your homework, have done some research and are comfortable with what is on the market that would meet your needs and have been out and seen homes for sale, you need to be ready to strike. Now I am in no way saying rush but when you are ready to buy and see what you want you need to take action. I can’t count the number of times clients have looked at a house one day and the next morning it is already under contract. Pricing is a whole other article, sometimes an aggressive offer is called for but not always! Many properties are being priced to sell from the start and they are getting offers the day they hit the market, sometime for full asking price or more!

So do the work upfront and be ahead of the curve. Save yourself a lot of time and aggravation and be able to buy a house on yours terms.


Tom Schroth,  is a career agent with over 20 years helping people buy and sell their homes and has owned over a dozen homes personally including rentals, investment properties, flips and rehabs. He practices what he preaches by making real estate not just a place you call home but a wealth building investment. Tom runs the Schroth Realty Group, schrothrealtygroup.com, a team of professionals dedicated to providing real estate buyers and sellers in the metro Atlanta area an exceptional experience. His resume included hundreds of real estate transactions, a broker’s license in both Georgia and Ohio, founding a real estate company, and managing and office of one of the largest real estate networks in Atlanta. Tom Schroth also runs Whiteboard Group, a business development consultancy and coaches business owners and individuals to help them get clear on their goals and take steps to achieve them and “Perform at Their Highest Level” see: wboardgroup.com and Tom’s other blog, “Business Yoda” businessyoda.com.

Do you have  house to sell? Are looking to purchase real estate? Contact Tom’s team at 888-724-7864

urlYour First Offer is Your Best Offer

If you ask people involved in selling real estate, whether agents or investors, you will hear this consistently, “your first offer is your best offer”.  I know when I heard this for the first time I said to my self “give me a break” and did not think much more about it. As I was involved in more and more transactions however it became very clear that on average this is true!

I call it “Market Fresh”, the fact that real estate sells better when it’s fresh on the market. Will you pay more for a fresh vegetable that was just put out over the one that’s even a few hours old? Will you drive past the grocery to the farmer’s market to get it direct from the source? A similar paradigm exists in real estate and property sales and there are several reasons this make sense. I will make a few of the most common observations here but you will need to judge for yourself and at some point take it on faith that your first offer on a “Market Fresh” property may be your best overall!

I can tell you story after story about the first offer that was turned down and then 6 months to a year later the property sells for less than that original offer. The MLS is full of houses and condos that are now listed below what they had offers for just months ago. I have experienced this with my clients numerous times and have seen it personally. In fact, I saw a house I made and offer on last year just sell for significantly less then I had offered them.


The buyers that are well qualified, are making a legitimate offer and are ready to buy are already well into their search.

The general life cycle of a buyer is to start driving around neighborhoods they like and searching on the internet. They are not serious or ready to make an offer. The next stage is when they are contacting the agents with the listings they are seeing and asking for more information. They make take a look inside a few houses at this point. Next are the committed buyers, they have asked a Realtor to help them locate properties and get inside. They are now getting to know that market and research properties to see what they can expect to pay. This goes naturally into the next stage where they are ready to start making offers and have been pre-approved with a lender.

As you can see, at this point the buyer has a good bit of market research behind them and they are educated on the market. They are now waiting for that right house to come up and are well prepared for it when it does. Assuming you are priced in a realistic range, you will get your first offer from one of these buyers. Even through they are not offering full price you need to consider that they are serious and know the market.

I am not saying take the offer but I am saying to work it! Even the best potential buyer will still have the need to shoot low initially just to see where you are at and to feel like they are not over paying in the end. Don’t be insulted, buyer’s want to feel like they at least tried for the low price so stay in the game, be patient. If you work out a deal they will not have as much buyer’s remorse over the price if they started low at first.

The offers that may come weeks or months later will be the newcomers to the market, the ones just starting out who will be afraid to pay too much and are still nervous about the buying commitment. They are new to house hunting, less educated about the market and will err on the side of caution. Their offers will typically be lower.

There may be other offers as well from bottom feeders or investors that having seen you on the market for some time are “going fishing” for a deal. These may be lower yet. It’s not their fault, they are assuming there is a good chance you are flexible (desperate?) because you have not sold yet. What would you think?

 About now you as the seller are starting to look back at that first offer you got?

You will want to consider many factors in determining what price to sell for. A careful consideration of the terms is essential as well as the value of a “bird in the hand”. You need also consider the value of your time, the trouble of showing your house, keeping it clean, paying taxes and maintenance, etc.

Will you be loosing other properties you would like to buy? Are you relocating and risking leaving an unoccupied house on the market? These things all can be assigned a dollar value and it is recommended that you consider all of these BEFORE you get that first offer.

Also working against you is the stigma of time on the market, after a few months your house is getting stale. There is a presumption by Realtors and buyers that if it’s still on the market something must be wrong. I can’t tell you how many times I have had buyers that in preparation to make an initial offer see that it’s been on the market for a while and reduce their offer. Literally, their eyes get big, they get a grin on their face and say, “Really, hmmm, let’s offer lower then”. Once they see it’s been listed multiple times the offers get much worse and it will cost you tens of thousands of dollars.

The easiest way to avoid these pitfalls for real estate are to put yourself in a buyers shoes to determine the market value before you list. Get in the car with your agent and look at the competition, that’s what I do with my clients. Know what your time and aggravation are worth. Have your house prepared for sale, don’t put it on the market and then start staging, cleaning and repairing, It needs to be a showpiece the day it goes for sale. Those same serious and market aware buyers will pay you for your preparation. These first buyers are not looking just for a deal, they are looking for the “right” deal, the value proposition.

Another paradigm in real estate is that the investment you make in preparing your home for sale will pay for itself in both real dollars and in time but that’s another article for another time!


Tom Schroth,  is a career agent with over 20 years helping people buy and sell their homes and has owned over a dozen homes personally including rentals, investment properties, flips and rehabs. He practices what he preaches by making real estate not just a place you call home but a wealth building investment. Tom runs the Schroth Realty Group, schrothrealtygroup.com, a team of professionals dedicated to providing real estate buyers and sellers in the metro Atlanta area an exceptional experience. His resume included hundreds of real estate transactions, a broker’s license in both Georgia and Ohio, founding a real estate company, and managing and office of one of the largest real estate networks in Atlanta. Tom Schroth also runs Whiteboard Group, a business development consultancy and coaches business owners and individuals to help them get clear on their goals and take steps to achieve them and “Perform at Their Highest Level” see: wboardgroup.com and Tom’s other blog, “Business Yoda” businessyoda.com.

Do you have  house to sell? Are looking to purchase real estate? Contact Tom’s team at 888-724-7864

 Please be so kind as to exit your home before showing…

Exit sign

First rule of showing your home to buyers… DON’T. What I mean here is YOU don’t. Everyone talks about all the things you need to do to prep your house, the cleaning, repairing, staging, de-cluttering but if you are on the property when the buyers are there to look at the house is all a waste. For the first visit I can not think of a good reason for the seller to be there. Real estate buyers will never feel comfortable looking at your house if you are there, and by there I mean anywhere in sight, including attic, driveway, other side of the yard, etc.

 Give them the freedom to nose around, to express their opinions, to contemplate, to picture themselves living there, sitting in there, I mean YOUR favorite chair!

If you’re concerned about your privacy then you don’t have your home staged properly for sale. As for security, your agent should have already coached you on taking valuables out of the house plus this is yet another reason you should consider a full service listing and allow only buyers that are accompanied by a professional real estate  agent.

“But what about the details? All the little things I did to make my house so dog gone special?” Home buyers don’t care, at least on the first visit. None of those things matter unless they like the overall house. In fact, you will be distracting them from the bigger picture!

“We just put in carpet, granite counters, new windows. I have to be there at least in the beginning to point that out.” First, refer to my last statement, if they don’t at least like your home in general those things don’t matter. Plus they will figure those things out, seriously, they are not going to miss your major upgrade and just in case, their buyer’s agent / Realtor won’t either.

 “I wired the whole house for sound and cat5 for internet goes into every room and we even have outdoor speakers. We added low flow faucets and get this, 1/4 turn water shut off valves.” Again, see the first statement. “No one will know to look for those things, they are little but so cool. I will need to point them out because the buyer and agent won’t think to point them out.”  I know these things matter to you or you would not have done them but 2 points here. Either they don’t care, at all, and will stuff those extra wires back into the wall and never hook up the outdoor speakers or if they care, they will do this for any house they buy and the fact that your has it won’t sway their decision.

It’s a fact, buyers spend less, a lot less, time looking at a property that has someone there. This includes the teenager, house guests, anyone that is not in the showing party. You greatly impact the chance of getting  a buyer prospect hooked on your house if you are there. You also will be alienating the agents bringing the buyers. Believe me, they talk and you don’t want to be one of “those” listings.


Make this process easy, pack a getaway bag and have it by the door or in the car. A couple of magazines, a good book, a pair of reading glasses, your phone charger, your walking shoes, a shopping list, whatever will make good use of your time for 30 – 90 minutes.

 Don’t forget to strategically position your getaway car! If the buyers or agent arrive before you leave you may be blocked and cause an awkward shuffling of cars.

If you do get caught at the house, do NOT engage the buyers or the agent in conversation. I LOVE to catch buyers at a house because I can get them to spill the beans on all sorts of things to help us negotiate. Don’t risk it, I have ways of making you talk and it will cost you if my buyer makes an offer. Be respectful but slip away quickly, pretend to be on the phone if you have to!

If it’s a weekend always be ready for a showing even if none are scheduled. Your house is for sale and it’s just something you have to deal with. Try to never deny a showing scheduled in advance or  a last minute weekend showing. The agent calling from their car out in front of your house may have YOUR buyer in the back seat!

 PLEASE… Exit gracefully and don’t be at your property when a showing is taking place.


Tom Schroth,  is a career agent with over 20 years helping people buy and sell their homes and has owned over a dozen homes personally including rentals, investment properties, flips and rehabs. He practices what he preaches by making real estate not just a place you call home but a wealth building investment. Tom runs the Schroth Realty Group, schrothrealtygroup.com, a team of professionals dedicated to providing real estate buyers and sellers in the metro Atlanta area an exceptional experience. His resume included hundreds of real estate transactions, a broker’s license in both Georgia and Ohio, founding a real estate company, and managing and office of one of the largest real estate networks in Atlanta. Tom Schroth also runs Whiteboard Group, a business development consultancy and coaches business owners and individuals to help them get clear on their goals and take steps to achieve them and “Perform at Their Highest Level” see: wboardgroup.com and Tom’s other blog, “Business Yoda” businessyoda.com.

Do you have  house to sell? Are looking to purchase real estate? Contact Tom’s team at 888-724-7864

When is the real estate market going to get back to normal?

the_new_normal_green_grass.1

The age old question of “what is normal” is applied to many things and when talking about residential real estate sales it is somewhat of a sliding scale. Your perspective is going to be influenced by where you are in the market now and when you last bought or sold.

I am writing this in March of 2013 and have been both a real estate agent since 1993 and a real estate consumer on a regular basis over the last 21 years. I have bought and sold a lot of houses for myself and my clients and have seen a variety of markets.

The “normal” for my parents who bought in the 50’s and only owned one house will not be the “normal” for most of my readers. My “Boomer” clients may remember big down payments, 18% interest rates and being glad to get them. The “Gen X’ers” are more apt to think of normal as 3-5% down or sometimes zero down with interest rates 5 – 7%, adjustable mortgages (ARMS), balloon mortgages, the introduction of FHA backed loans to get these lower down payments and the private mortgage market rushing to match them.

When I started in real estate, just about everything was FHA or VA insured and most buyers had very little to put down and seldom had any equity in their house. The mantra was buy as much as you could qualify for. As least in the 90’s and early 2000’s there were checks and balances that prevented a buyer from buying more then a certain price based on debt and income.

The mid 2000’s however saw those safety’s removed and that mindset had them buying more expensive houses and not having the income to support the payment. This create many purchases made on speculation with buyers thinking:

  1.  Prices are going up SO fast and money is SO easy to get I’ll take an adjustable mortgage now so I can stretch to get into a house I can barely make the payment on and in a year refinance to get  a lower FIXED rate.
  2. The economy is so good that even though I can’t afford the payments now (let alone upkeep of the house) my job will surely get better and my income will go up and I will be able to afford it next year so I will buy it now and hope for the best!

 

So what is the new normal?

I would have to say there really is not a “normal” after all. Real estate exists on a continuum, moving from one end to the other then back again. I will admit I thought it would take a lot longer after the 2008 swing to see anything less then 20% down but we are already seeing 3-5% down programs again. I have my doubts we will ever see the stated income products like we had then but I would not be surprised if we saw a product to cater to the self-employed that gave consideration to something other then the bottom line taxable income.

So what should you do? Timing of the market is for the lucky and for professional real estate investors. If you need to sell, then sell! If need to buy then buy! If you are happy where you are it then stay put. The average home owner will have several homes over the years and you are sure to experience a number of different markets and except for the extremes it averages out.


Tom Schroth,  is a career agent with over 20 years helping people buy and sell their homes and has owned over a dozen homes personally including rentals, investment properties, flips and rehabs. He practices what he preaches by making real estate not just a place you call home but a wealth building investment. Tom runs the Schroth Realty Group, schrothrealtygroup.com, a team of professionals dedicated to providing real estate buyers and sellers in the metro Atlanta area an exceptional experience. His resume included hundreds of real estate transactions, a broker’s license in both Georgia and Ohio, founding a real estate company, and managing and office of one of the largest real estate networks in Atlanta. Tom Schroth also runs Whiteboard Group, a business development consultancy and coaches business owners and individuals to help them get clear on their goals and take steps to achieve them and “Perform at Their Highest Level” see: wboardgroup.com and Tom’s other blog, “Business Yoda” businessyoda.com.

 Do you have  house to sell? Are looking to purchase real estate? Contact Tom’s team at 888-724-7864

Why not being Pre-Approved is costing you money!

what_is_a_pre_approval_and_why_do_you_need_itIf you are ready to start making offers on homes then you need to be setting yourself up for success by getting a pre-approval. You will hear two terms thrown around, one is pre-qualification and one is pre-approval. Sometimes used interchangeably they are very different things and there is quite a bit of confusion surrounding these terms as the definitions are not always the same depending who you are talking with.

For our purposes we will give each a distinct definition. Be sure to be clear on what each term means to the party you are talking to so there is no confusion.

Pre-qualification: This is a based solely on what you disclosure to a loan office or mortgage broker about your financial state including credit, incomes, assets, liabilities, etc. Nothing is verified and  thus is does not really mean anything. At best a pre-qualification can be used to get a broad picture of where you might stand and a generalization of prices you can afford but you can’t use it when a pre-qualification is what is needed.

Pre-approval: A pre-approval is based on documentation provided of income and assets as well as a current credit report. It will include verification of  W2’s  / paystubs or 1099’s, a credit report, bank statements, and pretty much everything that would be needed to make the loan application and go to underwriting. The only thing left after this is a contract to purchase and an appraisal. This is what you need to be sure what you can buy and more importantly this is what you need to prove to a seller that you can buy!

 NOTE: A lender will not necessarily ask for this level of documentation unless you make it clear what you are looking for. To get to this point a lender will have made a significant investment in time in you and they may ask for a fee to get the process started. This is not unreasonable.

Along those lines, you should be shopping for your lender BEFORE the house and note that there will NOT be a significant difference in pricing. Most fees are regulated so you will be looking for customer service and convenience. Trust me on this one, go with a local, brick and mortar lender, not a virtual online lender. There are no advantages and only heartache and stress to be found online.

There was a time when pre-approval was not emphasized as much and there was an assumption that most anyone could get a loan. Now it quite the opposite, it is assumed that most people can not get a mortgage, or at least not the one they thought they could. Even the best qualified candidate will experience a protracted time consuming process at best.

Meaning, if you have not already started the process before making the offer you likely will not be able to make the closing date.


  Why pre-approvals matter to you

  1. Suitcase full of money: There is nothing better for negotiation then cash dollars, certified funds, etc., sitting in the bank and if you don’t have that the next best thing is a loan approval. It’s a lot easier to be taken seriously when the seller is confident you can buy. If you do not have a pre-approval the offer  is theoretical at best. Consider these two statements:
    1. I may be able to buy your house if you will accept these terms. Would you please consider them and if we can agree, then I will see if I can actually buy.
    1. I will buy your house for these terms. I am pre-approved for a loan with this local well-known lender, they have verified my employment, checked my credit and confirmed I have all the funds for the down payment.
  1. You can move fast: What if that “perfect” home comes on the market, priced right and you know its “the one”. The house is listed with a true professional agent and the seller has stipulated all offers must have a pre-approval and permission to contact the lender to confirm (that’s what I do for my sellers). You may be the best qualified buyer on the planet and could afford something 3 times the cost but it’s Friday, 5:15pm, a 3 day holiday weekend ,etc. and you do not have a pre-qualification.  Do you think the house will be there in a few days? Lets say it is, how was your weekend? How did you sleep? Ok, a bit dramatic but you get the idea. Seller’s today are asking two questions, are you serious and PROVE IT!
  2. Get the best representation: If you are a well documented eligible buyer you will be able to attract the best representation including top lenders and real estate agents. Chances are that a realtor that does not require a buyer to be pre-approved will not be one of the more successful ones. What kind of business do they run if they have time to work with clients that may not be able to buy? Are they representing your best interests if they don’t set you up for success or let you waste your time? Have they done their job if you find a great house but lose it because they did not advise you on how the process works?

Mortgage-Application-ApprovedWe have “won” contracts for our clients with lower prices than other offers because our buyer appeared stronger financially. This due diligence on the buyer’s part regarding financing showed them as a stronger, more serious buyer. More transactions are falling apart after a contract is in place because of financing. Doing your financial homework upfront puts you in the best position to get your price and terms.


If you are not getting this advice you are not being counseled by a professional. Be sure you are working with someone that keeps up with the market and the business side of real estate, this is where they earn their keep. I will let you in on a little secret, we all have access to the EXACT same information on houses for sale, all of us. The difference is how well we know the business part and even more important the psychology of the transaction.

Regards, Tom Schroth


Tom Schroth,  is a career agent with over 20 years helping people buy and sell their homes and has owned over a dozen homes personally including rentals, investment properties, flips and rehabs. He practices what he preaches by making real estate not just a place you call home but a wealth building investment. Tom runs the Schroth Realty Group, schrothrealtygroup.com, a team of professionals dedicated to providing real estate buyers and sellers in the metro Atlanta area an exceptional experience. His resume included hundreds of real estate transactions, a broker’s license in both Georgia and Ohio, founding a real estate company, and managing and office of one of the largest real estate networks in Atlanta. Tom Schroth also runs Whiteboard Group, a business development consultancy and coaches business owners and individuals to help them get clear on their goals and take steps to achieve them and “Perform at Their Highest Level” see: wboardgroup.com and Tom’s other blog, “Business Yoda” businessyoda.com.

Do you have  house to sell? Are looking to purchase real estate? Contact Tom’s team at 888-724-7864