Real Estates Information

Real Estate business has seen tremendous growth and so has been the need of Real Estate agent. Today more and more people are getting interested to become home owner and as the demand for real estate need increases the role of Real Estate Agent becomes more important. In the past one agent use to provide services to both seller and buyer but as the real estate market changed people started to realize that specialized service is more logical and beneficial. In Real Estate industry now buyer/seller are looking for specialized agents who can provide specialized related expertise, information and services required to complete the process. When a real estate agent represents both buyer and seller it really restricts agents to provide impartial service to either party.

Let’s look at the both (Seller/Buyer) scenario separately. A real estate agents who is a listing agent of seller has a fiduciary, ethically and moral duty to represent seller only.

By getting Exclusive Right to Sell Listing, the real estate agent is promising seller that he will live no stone unturned to market the home and find the best buyer at maximum possible market value for the home.

As a Buyer’s real estate agent he need to find the right home for buyer along with should all information of the community. When a buyer is exploring to buy a real estate property in new community, he is very much interested to find out several information related to that particular community such as population, crime, climate, schools, traffic, living standards etc. Buyer’s real estate agent should be well informed with all these information so that he can provide that information to buyer. It will be easier for buyer to make the decision based on these information. Once the buyer is ready to buy real estate property in the community then other part of the real estate agent’s duty starts. As buyer’s agent it is his responsibility to find a real estate property, as per buyers requirement. It is also buyer’s real estate agents duty to negotiate the best market price with seller.

So if seller and buyer are represented by their own specialized agent then both agents can play a partial and specialized role for their client..

So it is quite clear that one real estate agent representing both seller and buyer can not justify providing specialized service to both party. Both buyer and seller are in different need of services. That’s why specialized real estate service has become more in demand where buyer/seller can get impartiality specialized service during the process.

Never before has the role of specialists in the world of real estate been more important. With buyers and sellers requiring more services, the industry has seen an explosion of agents who specialize in either the representation of sellers or buyers. These specialist agents can provide a wealth of services and maintain a complete impartiality during the sales process as there is only one client to concern them.

Historically the sales transaction and the concerns of the buyer were the purview of a single realtor. However, as the industry has progressed so have the needs of each party and so the specialist arose. Buyers have some very particular needs, and specifically the need to feel that their best interests are seen to. Listing agents are representatives of the home’s owner and in that role they have a primary responsibility to that owner. How could they properly look after the needs of an interested buyer as well?

So what is it that a buyer’s agent does? Primarily the buyer’s agent will begin with the location of suitable properties for their clients. This is usually based upon a list of requirements and desires that the client has communicated to the agent. They will then arrange viewings and recap their findings with their clients and assist in deciding upon a good candidate for an offer. This will be based on the wealth of community information that a buyer’s agent commands. As specialists, they are experts on their given area which is critical in the education of clients on the areas that they are considering. Once a property is decided upon, the buyer’s agent changes significantly, evolving into an overseer-negotiator role. They will typically coordinate the inspections and conduct the negotiations with the listing agent. This includes the execution of the buyers subjects and the closing of the actual contract.

There is an art to representing a buyer. It is a role that has become ever more crucial in an industry where customer service is the single most important thing that an agent can offer. If you are in the market for a home then the buyer’s agent is the friend that you need to make sure that you are given the service that you deserve.

If you have never borrowed money for your business before, you may be in for a surprise. Whether you want to borrow working capital to expand your business or leverage equity in a commercial real estate venture, you will soon find out the commercial loan process is very different from the more common home mortgage process. Commercial loans, unlike the vast majority of residential mortgages, are not ultimately backed by a governmental entity such as Fannie Mae. Consequently, most commercial lenders are risk-averse; they charge higher interests rate than on a comparable home loan. Some lenders go a step further, scrutinizing the borrower’s business as well as the commercial property that will serve as collateral for the loan. This means that the business borrower should have different expectations when applying for a loan against his commercial property than he would have for a loan secured by his or her primary residence.

Following is a list of questions the borrower should ask himself and the lender before applying for a commercial loan.

1. How am I going to meet the loan repayment terms?

Typically, bank loans require the borrower to repay his or her entire business loan much earlier than its stated due date. Banks do this by requiring most of their loans to include a balloon repayment. This means the borrower will pay interest and principal on his 30-year mortgage at the stated interest rate for the first few years (generally 3, 5 or 10 years) and then repay the entire balance in one balloon payment.

Many borrowers do not save enough in such a short time frame, so they must either re-qualify for their loan or refinance the loan at the end of the balloon term. If the business happens to have any cash-flow problems in the years immediately preceding the balloon term, the lender may require a higher interest rate, or the borrower may not qualify for a loan at all. If this happens, the borrower runs the risk of being turned down for financing altogether and the property may be in jeopardy of foreclosure.

A balloon loan has other risks as well. If the borrower’s business is in a “risky” industry at the time the balloon is due (think of the oil and gas bust in the 1980s or the telecom implosion of the 2000s), the lender may back out of all refinancing for the enterprise. Alternatively, a lender simply may decide its loan portfolio has too many loans in a given industry, so he will deny future refinancing within that trade.

Non-bank lenders generally offer less stringent credit requirements for commercial loans. Some non-bank lenders will make long-term commercial loans without requiring the early balloon repayment. These loans, which may carry a slightly higher interest rate, work like a typical home loan. They allow a steady repayment over twenty or thirty years. It is often worth paying a one- or two-point higher interest rate for a fixed-term loan in order to ensure the security of a long-term loan commitment.

2. How much can or should I borrow?

Most bank loans prohibit second mortgages, so the borrower should go into the loan process intending to borrow enough to meet current business needs, or enough to sufficiently leverage real estate investments. For a traditional acquisition loan in which the borrower is buying a new property, banks usually require a down payment of 20-25%. So for a $600,000 acquisition, the borrower will need to come up with $120,000-$150,000 for the down payment.

Some non-traditional loans will allow the borrower to make a smaller down payment, maximizing the loan-to-value (LTV) at 85-90%. Such loans are generally not bank loans, but are offered by direct commercial lenders or pools of commercial investors. If the customer wants to borrow the maximum amount possible, the interest rate on such loans may be a point or two higher than typical bank loans. Before deciding how much to borrow, potential borrowers should:

• Evaluate how much cash they are likely to need
• Analyze their ability to repay the loan as it is structured

Research has consistently shown that the number one reason behind the failures of most small businesses is the lack of adequate capital to meet cash-flow needs. Because of this it may actually be safer for a small business to leave a larger cushion against unforeseen events by borrowing more money at the slightly higher rate.

The amount of the loan requested has an effect on which commercial lenders will fund the loan. Small businesses borrowing less than $2,000,000 will visit a different pool of potential lenders than those seeking loans of over $5 million. Small business loans are generally made by direct commercial lenders (easily located by internet searches) or by small local banks. Larger loans are generally made by regional banks, and very large loans are made by mega-banks or Wall Street lenders.