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How to become a real estate agent

How to become a real estate agent

How to become a real estate agent

How to become a real estate agent

If you’re wondering how to become a real estate agent, you’re not alone. It’s a question thousands of people Google every month in America, as they consider joining the millions of real estate licensees in the U.S. And for good reason: Helping people buy the perfect home or make tons of money selling their house is exciting!

Still, buying and selling real estate isn’t as easy as it might look. And it’s a notoriously tough industry for newbies; some real estate experts like industry vet Tom Ferry estimate that a majority of all new agents fail within the first five years.

All of which means you should carefully weigh the risks and rewards of joining this profession. Just so you know what you’ll need to invest in terms of time and money upfront, here are the steps it takes.

  1. Take a real estate pre-licensing course
  2. Take the real estate licensing exam
  3. Activate your real estate license
  4. Consider becoming a Realtor®
  5. Join a brokerage

How much do real estate agents make?

Not to mention the rather enticing fact that real estate can be a lucrative field. According to the Bureau of Labor Statistics, real estate agents make an average of $49,000 per year—and the top 10% tier of agents can earn more than three times that amount.

“We can make as much money as doctors and lawyers, and they spend tens of thousands of dollars on their degrees,” says Rae Wayne.

Still, that’s not to say the process is easy. Here’s a general overview of how you get there.

Step 1: Take a pre-licensing course

Cost: $200 to $300

States require people to take pre-licensing training from a certified institution before they can sit for the real estate licensing exam. The required number of training hours can vary significantly by jurisdiction: In Virginia, for example, real estate agents must take 60 hours of pre-licensing training, but in California they need to take 135 hours.

The course will teach you real estate principles (terms like “lien,” “escrow,” and “encumbrance”), real estate practices (like how to determine a property’s value), and the legal aspects of the business. Go to your state real estate commission’s website to find information on licensing requirements and a list of accredited pre-licensing institutions.

Pre-licensing courses can be taken in person or online, so consider your learning habits before deciding where to enroll. (Some people focus better in a classroom setting, Wayne points out.)

Step 2: Take the licensing exam

Cost: $100 to $300

Revisit your state real estate commission’s website for instructions on how to sign up to take the licensing exam. (Most states outsource administration of the exams to third-party testing centers.) Exams are typically divided into two portions: one on federal real estate laws and general real estate principles, the second on state-specific laws. Both typically consist of 60 to 100 multiple-choice questions, including math questions that require you to use a calculator (e.g., prorating taxes for a specific property). Most pre-licensing courses provide students with sample tests, and many real estate commissions publish sample questions online.

So what are the odds you’ll pass? In some states like Florida, 50% fail the first time. The bright side is you can usually take the exam as often as you want over a two-year period. But once two years elapse, applicants are required to retake the pre-licensing course.

Step 3: Active your real estate agent license

Pass the test? Congratulations! Here’s what you need to do next to start engaging with clients:

  • Activate your license through your state real estate commission’s website. Activation fees vary but typically cost around $200 to $400.
  • Pay for membership to the local multiple listing service. Membership in your local MLS is essential, since you must use the system to list properties, which are then dispersed to websites like realtor.com®. The service also enables you to easily pull a property’s tax information, analyze market trends, and see listings before they go on the market.

Step 4: Consider becoming a Realtor®

In order to become a full-fledged Realtor®—a licensed agent with the ability to use that widely respected title—you need to be a member of the National Association of Realtors®. No exceptions. So what’s the advantage?

Membership in the NAR  offers a number of benefits, including access to real estate market data, discounts on education courses, and transaction management services. And being able to use Realtor on your business card and your marketing materials also adds credibility.

Step 5: Join a brokerage

In order to become a real estate agent and legally practice real estate, you must work under a supervising broker. Real estate brokers are licensed by the state to oversee real estate transactions and ensure that real estate salespeople (that’s you!) are adhering to the required legal and ethical standards. Think of it as a similar safeguard to how stockbrokers must work at a licensed firm to trade stocks, rather than just winging it on their own. Eventually, you could also apply for a license to become a real estate broker as well, but you will first want to get a few years as an agent under your belt.

Don’t expect to waltz in and collect an hourly salary: Most brokerages pay their agents only by commission. In other words, you get paid only when you complete a transaction, and you typically won’t receive benefits. Due to this pay structure, brokerages are typically eager to welcome new agents, since it comes at no cost to the company. So be sure to find a brokerage you like, one that is open to taking you on so you can receive some on-the-job training.

 

Join Our Team!

You worked hard to get your real estate license and we think you should be able to keep earning from that investment. We also know you want to make sure your friends, colleagues and past clients receive the same stellar service that you provided to them in the past.

Refer Florida was created specifically to serve agents here in Florida. It allows you to keep your licenses active, earn extra income and avoid the costs associated with traditional brokerages, MLS’s and trade associations. If you know someone wanting to buy or sell anywhere in the US simply complete the form and leave the rest to us. No showings, no contracts, no worries. Choose Refer Florida – referrals made easy.

 

Visit our website or call us today to learn more!  863-424-2309

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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Difference Between Net Effective Rent vs. Gross Rent

Difference Between Net Effective Rent vs. Gross Rent

Difference Between Net Effective Rent vs. Gross Rent

Difference Between Net Effective Rent vs. Gross Rent

You may have come across a rental listing with an attractive rent price, only to discover the actual rent is more than the one in the ad. While this may come off as a surprise, it’s common for landlords to use net effective rent and gross rent interchangeably in rental listings. However, this can make it hard to know how much to budget for rent for both renters and landlords.

We outlined the difference between net effective rent and gross rent to help you distinguish the two types of rent prices.

What Is Gross Rent?

Gross rent is a flat monthly rent price renters are responsible for covering throughout the lease term. Gross rent is typically higher than net effective rent, since it does not account for any promotions landlords may offer.

What Is Net Effective Rent?

On the other hand, net effective rent is the average rent amount that accounts for any discounts the landlord offers. Some landlords add the net effective rent price on their rental listing to attract interest, but this will not match the gross rent amount listed in the lease agreement. Net effective rent is viewed more as a helpful calculation that can help you properly prepare your finances as a renter and income as a landlord.

The landlord can either require the net effective rent each month or only the gross rent for months that are not included in the promotion.

How Is Net Effective Rent Calculated?

Net effective rent is calculated by multiplying the gross rent by the total amount of months a renter is responsible for paying rent. That number is then divided by the lease term, which can be anywhere from six to 15 months.

For more context, let’s say you’ve come across a listing that has a gross rent price of $1,800 and two months free rent on a 12-month lease.

net effective rate calculation example graphic

Because of the promotion, the rent the renter is responsible for will average to $1,500 per month — $300 less than the gross rent price. They can pay $1,500 each month (including the months that are considered free) or pay the gross rent price for only 10 months, depending on what the landlord prefers.

Pro tip: Check your lease agreement to ensure your landlord has listed which months you will not have to pay rent.

Finding Available Rentals

Net effective rent and gross rent both equal the total amount of money that will be paid during a lease term, but can dictate when and how much rent is paid. While it’s normal for landlords to use both rent prices interchangeably, you’ll want to ensure you’re aware of the exact price you’ll need to pay each month during the lease term.

Looking for an Experienced Residential Property Manager?

If you have a home to rent in the Orlando area be assured there is no substitute for experience. Covering Clermont, Winter Garden, Windermere, Dr Philips, Kissimmee, Davenport, Champions Gate, Hunters Creek and Haines City. We remain focused on this greater Orlando area to ensure we are able to provide outstanding service to our Clients without sacrificing performance. Looking for an experienced residential Property Manager in the Orlando area with a demonstrable track record – look no further.

Call us today to find out more (863) 424-2309

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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What Is Rammed Earth Construction?

What Is Rammed Earth Construction?

What Is Rammed Earth Construction?

What Is Rammed Earth Construction?

 

You may not be familiar with the term, but you’ve seen the building technique—think of the ancient architecture of the Great Wall of China, the Alhambra in Spain, and the stunning Kasbahs of Morocco.

These examples of rammed earth construction have stood the test of time, for several hundreds of years. And that durability is one reason this type of construction is making a comeback—albeit in buildings with significantly smaller square footage.

Rammed earth homes are sustainable and have a warm yet contemporary aesthetic to boot. Here’s what you need to know if you’re thinking about building or buying one of these unique homes.

What are rammed earth homes made of?

True to its name, builders use earth-based compacted soil to construct rammed earth homes. This earthy mix—which consists primarily of sand, silt, water, and clay—is set in formwork on the foundation.

“The rammed earth material is placed within the form in layers called lifts, typically 6 to 8 inches in depth, which are rammed with pneumatic tampers that can be maneuvered within the walls,” explains Bly Windstorm, CEO of Earth Dwell Ltd. and U.S. president of the nonprofit North American Rammed Earth Builders Association (NAREBA). “After a lift is fully compacted, another layer’s added and then rammed.”

Builders repeat this process until the wall is complete. All the building block essentials to complete the home are within each completed form. This includes reinforced steel, electrical and plumbing conduits, switch boxes, and even frames for doors.

The earth and aggregates available in the future home’s location determine the actual color of the walls. But if you want to put your stamp on Mother Nature’s offerings, you can alter rammed walls with various textures and finishes.

Types of rammed earth walls

The rammed earth buildings still standing today were constructed in areas where the earth’s soil had the optimum constituents for making durable walls. These “raw” types of rammed walls consist of sand, silt, water, and use clay as a binder, exactly like today’s walls.

However, it’s rare to find the optimum soil mix and the correct type of clay to make raw rammed-earth walls in the United States. And while, historically, clay has proven to be effective as a binder, the material isn’t earthquake-resistant, says Peter Jones, CEO of Gryphon Construction in Victoria, British Columbia, and Canadian president of the NAREBA.

As a result, new rammed-earth homes are mainly built with “stabilized,” reinforced rammed earth walls, to meet current building codes. So what makes the walls more stable?

“The addition of a Portland cement, lime, or other pozzolans [concrete improvers] allows the building of durable walls with local earthen materials in most localities around the world,” says Windstorm.

And the newer rammed earth formulas are more environmentally friendly, thanks to the additives like slag—a stony byproduct of melted or refined metal, which may remove harmful chemicals from the environment, says Jones.

Down-to-earth benefits of rammed earth construction

If you decide to build a rammed earth home, you won’t just be paying homage to one of the wonders of the world. You’ll enjoy these eco-friendly benefits as well:

Energy-efficient climate control: The aesthetics of these homes may evoke a stone-cold feel, but the opposite is true. Rammed earth walls are known for their high thermal mass, which means they absorb, store, and release heat, whether the house is in Alaska or Arizona.

“The house remains naturally cool in the summer and warm in the winter, with a small fraction of the energy required for a conventional home,” says Windstorm. Bonus: The walls are fireproof and provide sound insulation.

Environmental advantages: Rammed earth homes basically last forever, Jones says, “whereas conventional ‘stick-homes’ may last 80 years.”

Rammed earth walls don’t require painting or siding. And they are non-toxic, which means there’s better air quality within the home. 

Another green checkmark? Utilizing the earth’s soil for walls reduces the heavy load on our forests. And there’s not much chance of depleting earthen material.

“Even a small, 5-acre quarry could produce enough earthen material for over 1,000 homes,” adds Windstorm.

Minimal maintenance: There’s an endless to-do list of maintenance and repair costs with houses made out of wood. With rammed-earth homes, the upkeep is minimal.

Rammed earth walls are weather-resistant and only need a second coat of sealer 10 to 20 years after construction. The only significant housing components that might require attention at some point are the roof and windows.

Drawbacks to rammed earth homes

“The greatest downside is the higher cost of construction as compared to a stick-built home,” says Windstorm. The massive rammed earth walls—about 18-inches to 2 feet thick—are expensive to make, take longer to build, require special equipment and skilled labor to erect.

Gore Designs, a rammed earth builder, says that they could cost 30% to 70% more than a stick build. However, rammed-earth homeowners save in the long run, thanks to the lower energy costs and the fact that they need less upkeep.

Finally, there’s the commitment issue. It’s way more complicated to add an electrical outlet—let alone remodel a bathroom—when you have a rammed earth home, due to the thickness of the walls.

That means you have to put a lot of thought into designing a home that you can live in for many years to come.

Experts in Residential Real Estate in Orlando

If you are buying or selling real estate it’s quiet often the single most important financial decision you make. For the last 30 years we have helped clients buying and selling property in Orlando and the surrounding areas. Put simply, this means the knowledge and expertise accumulated over this time ensures our clients get the best representation possible.

Our experienced agents will help and guide you through the entire process providing valuable support every step of the way.

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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9 Myths About Buying a New-Construction House

9 Myths About Buying a New-Construction House

9 Myths About Buying a New-Construction House

Many first-time homebuyers might shy away from the prospect of buying a brand-new home, assuming: It will cost too much. It will take too long.

While purchasing new construction is indeed different from purchasing previously owned property, many misconceptions abound about new builds. As a result, homebuyers who’ve heard these rumors might be passing over a smart path to homeownership that makes sense for many Americans today.

“Given declining housing affordability and limited existing home inventory, a full one-third of inventory on the market is now new-construction homes,” says Robert Dietz, senior vice president and chief economist for the National Association of Home Builders.

In other words, in a housing market plagued by limited inventory, prospective homebuyers can’t afford to count out new-construction homes as an option—and they certainly shouldn’t just because of some persistent misconceptions.

With that in mind, we’re here to set the record straight on some easily busted new-construction myths that just won’t quit.

1. New construction homes are more expensive

While new-construction homes might technically cost more upfront, that price tag is not the whole picture.

“It’s true, on the average, that new homes of similar sizes historically outprice pre-owned by about 16%,” says Stephen Haines, president of Artisan Built Communities. “But since homes don’t possess a clear odometer on them, like one would use to evaluate a used car, buyers need to consider all the costs of purchasing to understand their total cost of ownership.”

A new-construction home, after all, will sport a brand-new roof, appliances, HVAC equipment, and major systems that homebuyers likely won’t need to repair or replace anytime soon. In other words, while a new-construction home might have a sales price that seems more expensive upfront, it’s actually saving a buyer from having to replace, upgrade, or “bring to code” elements of a previously owned home, which could cost tens of thousands of dollars.

“Depending on the age of the pre-owned homes, one should understand the remaining life expectancy of these components,” says Haines. “One must look closer to total cost of ownership to understand the truth.”

2. You’ll be waiting a long time to move in

It’s true that new-construction homes do take time to be built—on average, about 6.5 months from the ground up.

However, this does not mean you’ll need to wait that long, since builders often start building long before they have a buyer. Construction on these “spec homes” might already be well underway or even completed before you strike a deal. So if you don’t want to wait at all, see if there is a spec available.

Yet it’s also worth keeping in mind that the build time will vary widely, particularly with recent supply chain issues that might lengthen the timeline. Factors that could affect construction time frames include the availability of labor and materials as well as municipality permitting times.

Bottom line: Make sure to ask when they expect the house to be done, and what happens if the house is not done on time.

3. It’s harder to finance a new-construction home

Actually, the exact opposite is true here. Thanks to potential builder incentives and lenders liking the fact that a person is buying something new (which translates to less risk), there might be more simplicity in financing a new home.

“Builders often maintain relationships, partnerships, or even wholly owned subsidiaries whose primary focus is to help borrowers find better lending options,” says Haines.

Plus, title companies that work with builders tend to do “batch” title searches on the new parcels in a community all at once. This helps an urgent buyer get to the closing table faster.

“If you are looking at a larger national builder, they will generally have affiliated lending companies or their own lending companies that willoffer you several incentives to do business with them instead of an outside lending source,” says Don Turner, national sales director of new homes at Realtor.com®.

If you happen to find a better deal with an outside lender, maybe someone you’ve been pre-approved through, most builder lenders will usually work to match or beat that deal to keep your business in-house so they can directly manage your mortgage file. And if you are working with a smaller builder that does not have an affiliated lender, the builder will typically work with a local mortgage broker to assist buyers in securing loans.

4. New homes lose their value faster than pre-existing properties

While it’s true that new cars lose a lot of their value the instant they’re driven off the lot, the exact opposite is the case with new homes. In fact, many new-construction homes appreciate in value even before their buyers have moved in.

“Most buyers who buy in the early stages of construction in a community can expect to build equity even before they closeon their home, because of price increases as the builder sells more homes,” says Kimberly Mackey, founder of New Homes Solutions and a sales and marketing management consultant specializing in residential homebuilding. There is generally also another spike in value once the entire community is completed.

5. You can’t inspect a new-construction home before you buy it

You can absolutely do a home inspection before you purchase a new construction.

“I would be cautious of any builder who refuses to allow you to perform a home inspection,” says Bill Samuel, owner of Blue Ladder Development.

In fact, buyers who choose to purchase a new-construction home can actually periodically inspect the home throughout the build, giving them and their inspector a much higher understanding of the home’s condition; plumbing, electrical, and HVAC systems behind the walls; insulation; and more than they obtain by inspecting only a completed home.

“I would also encourage buyers to try and perform an inspection before the builder starts drywalling the house,” says Samuel. “Having the inspector walk through the home before the drywall is installed allows him to see many important parts of the home that will be covered up.”

New-construction homes are also inspected by local municipalities throughout the construction process, and those same groups provide a final certificate of occupancy before move-in is allowed.

Homebuyers also are provided an opportunity to conduct a walk-through of their home before taking possession of it. All in all, there are plenty of opportunities to kick the tires on a new house.

6. New-construction homes are lacking in character

Beauty is in the eye of the beholder. It’s the same thing with what someone defines as character. And just because something is new, it doesn’t mean it can’t have every feature you’ve ever dreamed of in a house.

“A person can choose or add different features for whatever they can afford to buy or add on,” says federal construction and security contractor Charles Chadwick Jr. “I’ve seen homes in subdivisions where some had vinyl siding only, and others had bricks/stones added in addition to vinyl siding.”

Trends tend to be fleeting, and new-construction homes are more likely to be up to date.

“New homes possess the most current designs,” says Haines. “As it relates to existing homes, the older the home, the harder it is to help the exterior of the home look current.”

“Nothing is more limiting than buying a home as is,” says Haines. “You have the most choice when buying new, regardless of the builder’s option offering.”

It all depends on the builder. Some builders build homes on spec—meaning the home is already built to certain specifications, and in that case, the customer will have very few or even no choices. Others build homes to plan but allow for a variety of selections and/or upgrades.

To determine what kind of builder you might be working with, check builder reviews before you get into a contract.

8. New-construction homes are poorer quality than pre-owned homes

“They don’t build them like they used to” is an old saying that just doesn’t hold water when buying a new-construction home. No matter what kind of house it is, the building construction principles generally do not change at all.

“For example, the construction of a load-bearing wall will not ever change—whether it’s in a new home or a custom-built home,” says Chadwick. Regardless of specific features, a house is still going to be built to a requisite standard.

“New homes are subject to the latest in building code, which has become more stringent over time,” says Haines. He notes they are subject to improved electrical wiring requirements, more ground-fault interruption requirements (including outdoor HVAC equipment in 2022), higher insulation requirements, more efficient air conditioners, and improvements in plumbing. (Old copper and early PVC are highly subject to leaks.)

9. You don’t need a real estate agent to purchase new construction

Technically this is true: You are not required to have a real estate agent for many new-construction home deals. However, it is generally still a good idea to have your own representation.

Because a new-construction deal is really no different than any other real estate transaction, there might be opportunity for you to negotiate on the price, contract terms, add-ons, completion date, and other incentives. Having a real estate agent to help with this can help make sure you’re getting the best deal possible.

 

Experts in Residential Real Estate in Orlando

If you are buying or selling real estate it’s quiet often the single most important financial decision you make. For the last 30 years we have helped clients buying and selling property in Orlando and the surrounding areas. Put simply, this means the knowledge and expertise accumulated over this time ensures our clients get the best representation possible.

Our experienced agents will help and guide you through the entire process providing valuable support every step of the way.

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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5 Things to Not Bother Fixing When Selling

5 Things to Not Bother Fixing When Selling

5 Things to Not Bother Fixing When Selling

5 Things to Not Bother Fixing When Selling

 

Your house needs work before it goes on the market. For starters, you’ll have to fix the boiler. And paint. And replace those outdated cabinets … the list might go on and on.

Given that all these tweaks cost money, you might wonder: Do I have to do everything? 

Many of these fixes are indeed necessary, says Kathleen Kuhn, president of HouseMaster, a national chain of home inspection offices.

“Any defect or condition that affects the intended function or operation of a major house system should be fixed,” she says. This would include taking care of leaks, built-in appliances not functioning properly, insect infestations, plus any imminent safety or environmental hazards.

But beyond that, it’s up to you: Sure, the nicer your home looks, the more money you’ll likely be able to fetch when selling it. But not all improvements you make offer the same return on investment. Here are some fixes that some experts say you can pass on without too many repercussions.

1. Fixing cosmetic damage

Cosmetic damage includes things such as scuffed floors or peeling paint: They don’t interfere with the function of your home, although they do make it look run-down. The good news is, a keen home buyer knows to look beyond that, says Craig Webb, editor of Remodeling Magazine.

“Sophisticated home buyers and home flippers know that cosmetic damage can be easily fixed,” says Webb. What will give them pause is the hard stuff.

“They are going to want to know that the electrical and plumbing systems are up to grade and that the utility bills are decent,” says Webb. If the home’s structural issues are sound and the “bones” are good, then you can let the surface stuff slide.

2. Updating kitchens and bathrooms

So your kitchen is woefully outdated, your bathroom avocado green (yuck). That may be OK. Really.

The reason: Many buyers these days look forward to remodeling these “fun” areas—plus, trying to second-guess what they want and have it there waiting for them is just plain unrealistic, given all the home decor styles there are to choose from today.

“Maybe you favor a French provincial kitchen and he or she likes Scandinavian modern,” says Webb. “People have very different ideas about what a perfect kitchen is or what a perfect bathroom is. It’s a big risk, and unless you know your exact buyer, it’s better not to guess. The next person will impose their own dreams on the house anyway.”

3. Doing partial fixes

Compare agents

If you do decide your kitchen and bathroom are so bad they’re worth redoing, don’t go halfway. Unless you can redo a whole kitchen, don’t bother with partial fixes. Older cabinets with brand-new granite countertops only highlight the old.

4. Repainting in trendy colors

We don’t care if the color du jour is violet—selecting “trendy” paint colors is yet another bad move.

The reason: Color trends come and go so fast, what might look great today will look dated tomorrow or, even if they’re totally hip, might not appeal to large swaths of buyers anyway.

Bright colors are really trendy right now, but they don’t appeal to a wide audience,” says Samantha Hancock. So if you must paint, “keep things neutral,” advises Hancock. “Odds are the buyer is going to paint the house how they like it anyway.”

5. Renovating beyond your neighborhood’s norm

There is a saying that Webb likes to use: “Too much house for the neighborhood.” In other words, if all the houses on your block are beautifully furnished and landscaped, then it likely is worth it to spend the extra cash on your own. But if your house is the only house on the block with a well-kept rose garden and indoor dog shower, you may not get the return you hope for.

“No matter how much you try to have the jewel house to live in, you aren’t going to get the return on the investment if the rest of the neighborhood doesn’t match,” Webb says. So check out your neighbors’ homes and plan accordingly.

Experts in Residential Real Estate in Orlando

If you are buying or selling real estate it’s quiet often the single most important financial decision you make. For the last 30 years we have helped clients buying and selling property in Orlando and the surrounding areas. Put simply, this means the knowledge and expertise accumulated over this time ensures our clients get the best representation possible.

Our experienced agents will help and guide you through the entire process providing valuable support every step of the way.

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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What Happens If I Have a Lien on My House?

What Happens If I Have a Lien on My House?

What Happens If I Have a Lien on My House?

What Happens If I Have a Lien on My House?

 

This is a question you might face when it comes time to sell your place. Basically, it means that before this transaction can go through, you’ll have to deal with this lien, which is placed on property by entities that claim you owe them money. Here’s everything you need to know about what happens when you have a lien on your house.

What is a lien?

A lien is a legal notice that’s placed on file as a consequence of an unpaid debt. If you haven’t paid your real estate taxes, for example, the government might impose a lien on your property. A mechanic’s lien or a construction lien might be placed by a contractor who’s done work on your home but hasn’t been paid.

How a lien is found

Before a property sale can go through, a title company is brought in to find out whether or not a seller has the legal right to sell the property. To do that, the title company searches public records for liens on the property, meaning anyone who has a claim to a portion of the money should the property be sold.

Many sellers may already be aware of liens filed on their property, but some may come as a surprise, says Barbara Carrollo-Loeffler, director of consumer and residential lending at Provident Bank in Jersey City, NJ.

For instance, there may be a recent lien for which you haven’t been notified yet, or it may be so old you may have even forgotten it was there. The lien may also be the previous homeowner’s responsibility, but went undetected during your own title search when purchasing the house.

What does it mean if I have a lien on my house?

If a lien is found, the title company will contact you and inform you how much you owe—and whom you need to pay.

“The sale cannot go through unless the lien is paid or released,” explains Pete Palermo, president of Legend Title in Denver.

Payment will fall on the seller. Once you’ve paid a lien, you will get what’s called a “release of lien” from the entity that filed it in the first place. This will prove you’ve cleared the title, and it will allow the sale to go through.

To get that release, you have three options, says Todd Huettner, owner of Huettner Capital, a mortgage service in Denver:

  • Provide proof (in the form of receipts or otherwise) that there is no debt owed, or that it was paid already.
  • Pay the lien or agree to pay the lien at closing with the proceeds from the sale of the home.
  • Dispute the lien and get a court decision requiring release of the lien without payment.

 

What if the lien on my property isn’t correct?

This does happen, says Huettner, usually in the case of an unreleased lien from a prior homeowner that went undetected during your own title search when purchasing the house. In that case, the title company will contact the old owner and ask for a release of lien to record.

“If the owner does not have the release, then they or the title company can contact the entity who placed the lien to get it released,” he says.

You can also hire an attorney and go to court to fight a lien, but the process can be long and costly, which may further cost you the sale. In that case, the experts say paying the lien may be your best bet in order to make the sale.

Experts in Residential Real Estate in Orlando

If you are buying or selling real estate it’s quiet often the single most important financial decision you make. For the last 30 years we have helped clients buying and selling property in Orlando and the surrounding areas. Put simply, this means the knowledge and expertise accumulated over this time ensures our clients get the best representation possible.

Our experienced agents will help and guide you through the entire process providing valuable support every step of the way.

Ready to make a Move?

Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.

 

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