House shopping strategies without using MLS

The low housing inventory is discouraging many home buyers. Low inventory along with increasing home prices and buyer competition can make shopping for a home today a frustrating endeavor. If you’re a serious home buyer, there may be other strategies to finding homes for sale other than those listed in the multiple list system (MLS).

The “For Sale by Owner” sign in the yard is a tell tale sign; however did you know that many FSBO’s can be found listed in the MLS? These are listed through brokers who are paid a flat fee as an MLS listing placement service. And although most are listed online, not all FSBO’s are found in the MLS. You can also find FSBO’s on numerous “by-owner” sites, as well as Zillow, Trulia, or Craigslist.

Listservs and internet groups are another way to find non-MLS homes for sale; however, neighborhood groups often restrict membership to residents. Leveraging your personal and social networks by announcing your search for the non-MLS home for sale will most likely prompt them to inform you about what they have heard through their networks and neighborhood listservs/groups.

The National Association of Realtors® 2013 Profile of Home Buyers and Sellers (realtor.org) indicates that 92% of buyers search the internet. Besides FSBO’s; online services such as Zillow, Trulia, Craigslist, also list foreclosures auctions, pre-foreclosures, and of course broker listings too. The internet is also where scammers are lurking, waiting to prey on you. Be wary about phone numbers that are out of the area; experts agree that you can avoid most scams if you deal with local individuals with whom you can meet in person.

Buying a foreclosure is often suggested as an avenue to buy a non-MLS home. Although most bank-owned homes become listed in the MLS, you have the opportunity to purchase a home at the foreclosure auction. If you’re an auction novice, seek out a real estate professional to assist you; homes are purchased “as-is” and you usually do not have the opportunity to inspect the interior. Mistakes that are often made by inexperienced auction bidders include misunderstanding the terms of the auction, overestimating home values on those they bid, as well as getting carried away and over bidding. Pre-foreclosures are often listed in the MLS as short sales; however, it is necessary to be aware of local laws (such as the Maryland Protection of Homeowners in Foreclosure Act) when approaching distressed home owners who have not listed their home for sale.

Searching through expired and withdrawn MLS listings is another way to find eager home sellers. Your real estate agent can provide you with such a list; however, it is not easy and you may quickly discover the reasons why many of these homes did not sell.

Even though, many alternate strategies for finding a non-MLS home for sale can be achieved without a real estate agent you should consider hiring an agent; besides representing you and assisting in structuring and facilitating the transaction, it is also common for agents to use these strategies to search on behalf of their busy clients.

A down side of the search for the non-MLS home for sale is that instead of competing with other home buyers, you’re competing with many real estate agents; not just those agents representing home buyers, but also the many agents searching for their next MLS listing.

by Dan Krell ©
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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. This article was originally published the week of March 31, 2014 (Montgomery County Sentinel). Using this article without permission is a violation of copyright laws. Copyright © Dan Krell.

February 27, 2014July 4, 2019

RESPA empowers home buyers and consumers

Although the Real Estate Settlement Procedures Act (RESPA) is one of those laws that you don’t hear much about, it’s a consumer protection statue that has been around for while. Enacted in 1974, RESPA was intended to help home buyers be better shoppers by requiring the disclosures regarding the nature and costs related to the real estate settlement process. Keeping RESPA relevant, there have been modifications and clarifications through the years, most notably the change of administration and enforcement in 2011 from HUD to the Consumer Finance Protection Bureau (CFPB).

RESPA is generally known for empowering consumers in the real estate process by allowing consumers (in most cases) to choose service providers, and prohibiting kickbacks (e.g., unearned fees) for referrals. Section 8 of RESPA prohibits real estate service providers from giving or accepting a fee, kickback or anything of value in exchange for referrals of settlement service business involving a federally related mortgage. While Section 9 prohibits a home seller from requiring the home buyer to use a particular title insurance company, either directly or indirectly, as a condition of sale.

RESPA also requires the disclosure of affiliated business arrangements associated with a real estate closing. An affiliated business relationship is considered to exist when there is a direct or indirect referral from a service provider to another provider of settlement services when there is an affiliate relationship or when there is a direct or beneficial ownership interest of more than one percent. The disclosure of such a relationship must specify the following: the nature of the relationship (explaining the ownership and financial interest) between the provider and the loan originator; and the estimated charge or range of charges generally made by such provider. This disclosure must be provided on a separate form at the time of the referral (or at the time of loan application or with the Good Faith Estimate if referred from a mortgage lender). In most cases, you’re not required to use the referred affiliated businesses.

RESPA violations are serious, and penalties can be severe. For example, HUD (hud.gov) lists the penalties for violations of Section 8 “… anti-kickback, referral fees and unearned fees provisions of RESPA are subject to criminal and civil penalties. In a criminal case a person who violates Section 8 may be fined up to $10,000 and imprisoned up to one year. In a private law suit a person who violates Section 8 may be liable to the person charged for the settlement service an amount equal to three times the amount of the charge paid for the service.”

The real estate industry takes RESPA very seriously; the industry educates service providers about empowering consumers, as well as regulation compliance. And although modifications of RESPA are to keep up with the real estate industry; some still claim that there are sections of RESPA that remain vague, as demonstrated by the Supreme Court opinion of Freeman v. Quicken Loans, and further clarifications (such as the RESPA Home Warranty Clarification Act of 2011).

In the past, RESPA violations were pursued vigorously by HUD; resulting in settlements as well as criminal investigations. Today, the CFPB (consumerfinance.gov) has taken over the reins, and continues the pursuit of RESPA violations with the same if not increased vigor. More information and guidance about RESPA can be obtained from the CFBP (consumerfinance.gov).

by Dan Krell
© 2014

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

February 7, 2014December 13, 2022

Reclaiming the charm and appeal of old homes

“They don’t build’em like they used to…”

… is often heard by those who praise the virtues of an old home. Many home buyers might talk about the character and charm that exudes from an old home, while others might point to the quality of materials and workmanship that cannot be matched by new homes built today.

In some respects, it’s good they don’t build homes the way they used to because some materials used in the past that were thought to be beneficial have been found to be toxic and/or hazardous. Building materials have changed through the years and continue to evolve for safety, strength, durability, and environmental impact. Many home components are engineered and prefabricated to make installation straight forward, as well as make the home increasingly efficient and environmentally friendly. Floor joists and trusses are engineered to allow for larger and open home designs; while roof and siding components engineered to help reduce heating and cooling costs. Foundation and basement construction techniques and components are designed to be effective in preventing water penetration.

Workmanship has also changed over the years as well. Because engineered materials are typically prefabricated, onsite custom design and installation is not necessary; construction crews are basically required to know how to use and install the pre-manufactured components.

Hazardous materials aside, there is something about old homes that grabs our attention. Because the building materials and components were not mass produced or prefabricated, perhaps it’s the workmanship of the construction that demonstrates that the on-site craftsmen were not just masters of their trade – but artisans.

Although new homes incorporate modern fixtures and appliances designed for comfort, functionality, and efficiency; many are drawn to the antique quality of the old home. Old home parts are highly sought after items for modern homes too. Many are lured by the appeal and personality of vintage home parts, but I also sense there is also something about the durability of the parts that lets them continue in service. Vintage doorknobs, especially the crystal type, are collectible and sought after antique home parts.

Those who appreciate old homes talk about the hearty materials that were used in construction. Compared to the new engineered components manufactured to an exact specification, the craftsmen who built the old home onsite appeared to use ample materials that made the construction feel sturdy and robust. This “over-engineering” is typically frowned upon today; using too much raw materials is expensive and considered wasteful.

Another comparison between old vs. new homes is the lumber that is used in a home’s construction. Some are keen on old homes because they were built from first generation lumber, compared to engineered composites typically used in modern homes. Compared to the wood composites often comprised of glued wood pieces and fibers, first generation lumber is believed to be stronger and more durable. Also known as old growth lumber, first generation lumber refers to lumber that was milled from virgin forests where trees were hundreds of years old. Because of deforestation, old growth lumber is no longer harvested for construction materials.

To incorporate the virtues of vintage and old building materials in modern homes, many reclaim those resources from tear downs. From classic fixtures and hardware to first generation wood, the reclaiming industry has become popular not only to be environmentally friendly – but to reclaim the charm and character of a bygone age.

by Dan Krell ©

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. This article was originally published the week of February 3, 2014 (Montgomery County Sentinel). Using this article without permission is a violation of copyright laws. Copyright © Dan Krell.

January 24, 2014July 25, 2019

Home buyers become internet detectives

Home buyers have access to more information in today’s internet connected society than ever before. Home buyers have become internet detectives, doing their home buying research online.

Years ago, a buyer would have to act as a detective to verify or uncover more information about a home; their sleuthing could take up lots of time at the court house and library, as well as interviewing neighbors. Besides the seemingly countless number of online resources for home searches, buyers today also have many internet resources available to them to obtain home and neighborhood information.

Home buyers are internet detectives.

Neighborhood and demographic information are now readily available online in many home search websites. For example, neighborhood information currently displayed includes information about a zip code that includes: home sale statistics; general population demographics; economic, school information and environmental information; and even information about quality of life. Other popular search sites with lots of valuable information include (but not limited to): zillow.com, trulia.com, and redfin.com.

Many home buyers also look to greatschools.org as a reference for local school information. The website describes itself as a national non-profit whose mission is to “inspire and support families to champion their children’s education – at school, at home and in their community…”

As interest in the paranormal has increased, more people are interested in knowing if someone died in their home. For a fee, diedinhouse.com offers a report that could include: if a death occurred in the home, the name of the deceased, cause of death, list of previous residents, and possible information about the death.

Besides commercial websites; state, county and municipality websites also offer an abundance of information. For example, some of the local agencies that maintain websites hold valuable data to home buyers and owners. For example, the Montgomery County Department of Housing and Community Affairs’ eProperty Data Mining Tool. The tool allows you to search multiple State and County databases for information about a home. Information that may be included: Department of Assessments and Taxation Real Property, code enforcement, permits, and Montgomery County Police.

Home buyers who are curious about neighborhood crime can find a number of commercial websites that map crime and offender information; however, to get accurate and timely information, you should probably look to the local police departments. By directing specific questions to the police by visiting local precincts, you can obtain a wealth of information. However, much of the information can also be viewed online: For example, the Montgomery County Police website has links to local crime statistics and even active warrants. The site also has a link to the sex offender registry (which is maintained by the Maryland Department of Public Safety and Correctional Services) as well as information about receiving alerts when an offender moves into your zip code.

Another local agency that offers information is the Montgomery County Department of Permitting Services. The website offers a data search tool that can display recent permit applications and permit status for a specific address. The site also includes zoning and code information. However, online County Master Plan (montgomeryplanning.org) information is offered by Montgomery County Planning Department, and can be viewed at.

As online resources grow, anyone can join the “internet detectives.” Although there are many online resources available, the websites listed here are not inclusive; I am not endorsing any commercial websites. Besides being cautious when visiting websites; you should acknowledge that many commercial sites are not 100% accurate, as disclaimers will disclose that technical and/ or reporting errors can occur in the collection and/or reporting of data.

Original located at https://dankrell.com/blog/2014/01/24/home-buyers-become-internet-detectives/

By Dan Krell
Copyright © 2014

Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

January 1, 2014July 2, 2019

Can a home make you sick?

How safe are the materials that were used to build and finish your home?

There are a number of materials that were commonly used in the home that at one time were considered safe, but are now known to cause health problems. And although some of these materials have been discontinued in residential buildings years after production and use, some can be found in older homes. However, there are other materials that are of concern that are still used in building and furnishing materials.

Lead was used as a residential paint additive for many years to enhance the paints’ properties; it was thought to increase paint durability and speed up drying. Since the acknowledgement that lead has deleterious effects on the nervous system, especially in developing children; there was a push to “get the lead out” of paint and other consumer products. Lead paint was subsequently discontinued and banned in 1978 from residential paints. Today, there are numerous disclosures about the possibility of lead paint existing in homes that were built prior to 1978; homebuyers are provided the opportunity to conduct a risk assessment to determine lead levels in homes where lead paint may exist. Lead certified contractors must be used when making repairs and renovations to homes built prior to 1978 (epa.gov).

Before it was acknowledged that asbestos is linked to a number of serious health issues, including mesothelioma; asbestos was used for thousands of years. The ancients mined and found many uses for asbestos. Considered to be a “miracle mineral,” construction use of asbestos mushroomed in the late nineteenth century. Although there were government bans on asbestos products during the 1970’s and 1980’s, asbestos is still used in some commercial applications (asbestos.com).

There has been a longstanding grassroots concern about vinyl and PVC materials because of the linked health issues thought to be from the off gassing and leaching of phthalates (phthalates are a group of chemicals used in the production of plastics). Vinyl and plastic building materials have also been widely used in homes for decades: vinyl flooring has been used in bathrooms and kitchens; vinyl has been used in laminate flooring; and PVC piping has been used for plumbing. The EPA has been and continues to study the production, use and effects of phthalates (epa.gov).

Imported drywall is a more recent issue that was reported to cause severe respiratory ailments; oxidized jewelry and corroded pipes were also highlighted. Although the bulk of the reports of problems associated with the imported drywall emanated from Florida, the Consumer Product Safety Commission (CPSC) has collected hundreds of reports from eighteen states and the District of Columbia. A majority of the complaints reported that affected homes were built in 2006 and 2007; which coincided with a time when building materials were in high demand due to a considerable increase in construction and the rebuilding of hurricane-damaged states (cpsc.gov).

As a result of the increasing awareness of toxins in and out of the home, the “green building” movement has become popular. Besides helping maintain a healthy environment, a key feature of green building is to also maintain air quality in the home; green building uses natural materials to avoid off gassing of toxins. For example, formaldehyde based materials, which are can be found in some “manufactured” woods and some carpets are avoided.

More information about green building, air quality and safety of building materials can be found at the EPA and CPSC websites.

By Dan Krell
Copyright © 2014

Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.