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One Way to Decrease Chance of Escrow Cancellation
Dealing with an escrow cancellation is less painful when you have a backup buyer.
You know, I can write about trying to avoid an annoying escrow cancellation until I am blue in the face, and it doesn’t change anything in Sacramento real estate. Part of the problem is we’ve got such a huge number of Realtors in Sacramento who do very little business, so they don’t always fully counsel their buyers. When I tell consumers that about 90% of the agents sell 3 or 4 homes a year, they are flabbergasted. How effective can an agent be when she closes so few sales?
I’m not knocking agents who don’t want to be top producers, btw. Not everybody chases the business nor finds challenges exciting and rewarding. Lots of real estate agents lead normal lives. But not me. And I have been trying to figure out how to avoid an escrow cancellation ever since they started happening in such huge proportions. When I have to resell what seems like half of my listings a second time, there is something seriously wrong.
Our limited inventory drives buyers and their agents nuts, I get it. They don’t like multiple offers and feel like they will always lose out, even when that is silly. There are tons of ways to beat that issue and win. Sometimes buyers get fed up so they write many offers on many homes when they can’t buy them all. Agents who encourage this crap should be strung up by their toes, dipped in honey and left to rot in a tree of wild bees.
Now when my sellers and I review offers, we’re looking for the offer we want to close, and we’re also looking for the buyer we would like to place in a backup offer. Rather than sell the home twice after the first offer sends an escrow cancellation, we’re taking out an insurance policy. I’ve been filling out the back-up offer addendum along with a counter and sending it to the buyer we would like to sell to if it wasn’t for the somewhat better offer we accepted.
I make it easy for the buyer to say OK. Sure, I’ll go into backup.
Sometimes the differences between those two offers are really slight. They could even be the same sales price. Why just the other day, in that very situation, the original set of buyers delivered an escrow cancellation the first day into escrow. That listing never went back on the market. The backup buyers moved into primary position and replaced the first buyers.
If you’re hoping to sell a home in Sacramento, call Elizabeth Weintraub at 916.233.6759. Why not put 40 years of experience to work for you? I’m always working to find ways to improve my client’s experiences.
What Happens After Escrow is Opened in Sacramento?
After escrow is opened, buyers should stop looking at homes.
After escrow is opened in Sacramento, any number of things can happen. What is supposed to happen is the buyer is excited and wires funds for her earnest money deposit, and the listing agent changes MLS to pending. But that doesn’t always occur like it should and, even if it does, there is more that can go haywire. Especially if the buyer is not counseled by her agent and is not fully committed to the transaction.
Buyers are not supposed to be online combing through other houses and wondering if there is something better to buy. I hate to say this, but there is not something better. There are hardly any homes at all available for sale.
I’ve got a home closing this week that I had to sell four times. Four times. And why? I was kidding with the seller and saying, Oh, third time is a charm, and then that buyer canceled, too. It’s generally nothing to do with the property. Mostly, it’s the buyers. If buyers did uncover some small defect, it’s often blown out of proportion to such an extent there is no piecing it back together, regardless of how much sense a listing agent might make for the case.
We had an offer accepted on Thursday for another of my listings. I discussed with the seller at length about whether we should accept backups and whether we should change MLS to pending. MLS rules grant listing agents 3 business days to change a status, so with an offer accepted on Thursday, we don’t have to change the status until Tuesday. By changing the showing instructions to call listing agent, it means I am inundated all weekend with calls. That’s the downside.
I did it for the seller. Kept the listing active and let callers know we are pending but welcome a back-up offer. Sure enough, though, just as soon as we changed the listing status to pending, the buyer canceled. That’s not how it is supposed to go. Buyers are supposed to be completing the documents their lender requires to process the loan, reviewing the loan estimate and preparing for a home inspection.
Instead, after escrow is opened, buyers are canceling and then we’re selling to somebody else. It happens so much lately it’s becoming the norm. Criminy, I don’t care who buys the home as long as the buyer is prepared to close. One thing is: I do not bail on my sellers. No matter how many times I have to sell that house, I’m in this to close this.
Hey See This New Listing: Remodeled Home in Foothill Farms
5901 Meghan Way, Sacramento, CA 95842 is for sale at $180K.
My new listing hit the market yesterday, it’s under $200,000, and it’s a remodeled home in Foothill Farms. That’s all you really need to know but I’ll give you the rest of the details. The living room has laminate flooring that looks like real wood, and crown molding. You will also note an oversized stained glass front door and a ceiling fan.
The seller is a house painter by profession, evident by some of the two-toned rooms. You’ll find ceramic flooring in the kitchen and dining area, an updated kitchen with granite counters, newer cabinets, stainless appliances, and plenty of storage space. Seller says the refrigerator can stay, but you’ll need to ask for it in the purchase contract.
One thing you need to know about this new listing and the remodeled home in Foothill Farms is it is a short sale, and not just any ordinary short sale, it is a Freddie Mac short sale with two loans. This means it will take a considerable amount of time to negotiate, perhaps 90 days. So enter that time frame into your equation for buying a home. If it works for you, then this might be a good time to buy a home in Foothill Farms.
The home features 3 bedrooms and a remodeled bath, with ceramic floors and a new vanity. There is also a big back porch that is enclosed and presently used for storage. Of course, the garage holds two cars and is attached. The seller will remove the above ground pool in the back yard.
The main thing this home needs is to repair or replace the siding. For that reason, it probably will not pass inspection for an FHA or VA loan. But if you’re willing to fix the siding prior to closing, and that can generally be arranged during your 30-day escrow period after approval, you could probably use a government loan to buy this remodeled home in Foothill Farms.
Call the listing agent, Elizabeth Weintraub, at 916.233.6759 for more information. 5901 Meghan Way, Sacramento, CA 95842 is offered exclusively by Lyon Real Estate and Elizabeth Weintraub at $180,000.
Looking for a Duplex in Sacramento at a Good Price?
2323 Matson Dr, Sacramento, CA 95822, is a duplex for sale at $265,000.
I was pleasantly surprised when I pulled up to this duplex in Sacramento and waited for the sellers last Saturday. The roof looks to be in good condition, the siding is vinyl, and it seems very well maintained. This is an investment property that’s been owned by the sellers for many decades, held in a trust. The successor trustees are now selling the property.
Met with the lovely tenants on each side, and they have been living here for 3 years or more. Very cooperative, friendly and sweet people with small children. The place showed pretty well for having children. Everything was cleaned up and picked up, and the tenants are very agreeable to showings, unlike some tenants I don’t wanna talk about.
Each side consists of 2 bedrooms, 1 bath, and a large private back yard, plus an attached garage. The square footage is 1,000 square feet for each side (per the County Assessor), and this duplex in Sacramento was built in 1980. Each of the units has its own garage, and having the two garages meet in the middle lends a bit more privacy to each unit. The tenants are presently paying about $800 each, but going rates for similar duplexes range from $850 to $950, maybe more. The tenants pay electricity. Owner pays sewer, water and trash.
This duplex in Sacramento is exclusively offered by Elizabeth Weintraub at Lyon Real Estate at $265K. 2323 Matson Dr, Sacramento, CA 95822. Call 916.233.6759 for more information. Below are more photos:
Living room of unit 2323 Matson Dr. Sacramento, CA 95822
Dining area, slider to yard and kitchen at 2323 Matson Dr.
Large private back yards at 2323 Matson Dr.
Photos: Elizabeth Weintraub
Why the Missionary Position is Always the Best
The missionary position in Sacramento real estate is perfect ranking against competition.
Sacramento Realtors like me can make a strong argument for anything, including why the missionary position might be preferred by more doctors 5 to 1. I’m certain to offend somebody somewhere on the internet today, by talking about positioning. It’s incredible what people find to get riled up about. Some of them send me mean, snippy little emails, when I write a completely tongue-in-cheek blog. They don’t get it.
Like last week I wrote a blog about hearing aids and where the microphone is located on your cellphone. It was a light-hearted blog, mostly poking fun at myself and how I stuffed soda straws into my ear as a kid. Some old fart like me — I presume he was an old fart because I talked about how 80% of 80-year-olds can’t hear a thing — blasted me. He was pretty ticked off. He told me to stop using hearing aids to sell houses. But if I could actually use hearing aids to sell houses, you betcha I’d do it. Sorry, old fart.
The missionary position I’d like to discuss today has nothing to do with what you might be imagining. I consider myself a missionary of Sacramento real estate. It is my religion. I am pretty much consumed by it. Even while on vacation to see the butterflies in Mexico last week, I pondered how to get my sellers another two weeks in escrow because the construction of their new home was delayed. Constantly thinking, analyzing. I created a solution.
One thing I do all of the time is relentlessly study the comparable sales for my listings. I don’t always remember to share the results of the analysis with my sellers, my bad, but I got into a discussion about it recently. The seller wanted to reduce the price, and I cautioned against it. She was positioned beautifully.
I could see why she considered a price reduction. She was in a hurry to sell, and owned a somewhat unique home. Agent after agent sent buyer feedback that mentioned their buyers had made an offer on another property. That’s excellent news to me! You know why? Because it’s one less competing home in inventory. When every home within a mile goes pending, and you’ve got the only home left on the market, your home will sell.
Which is not difficult in our present Sacramento real estate market. Comps are one thing but you’d be a fool not to consider the missionary position. Look at the value, the price per square foot, and how many homes are selling for less. If there is none, you’re in like flint. Sure enough, my seller’s home popped into escrow at list price. Happens time and time again.
