Can They Afford to Sell?
Before taking a listing, an ethical real estate agent attempts to qualify a seller who plans to sell one property in order to buy another. Determine a price range for the new real estate based on the seller's wants and needs. If the property is in another area, make sure the seller has researched real estate costs at that location.
Ask the seller for his approximate mortgage payoff for the existing property. Deduct the mortgage payoff and an estimate of all selling expenses from the value determined in your CMA to determine how much cash the seller should have left after closing on the property you plan to list.
Question
What should I do if the seller won't disclose his payoff amount?
Many sellers do not like to disclose financial information until you are their listing agent. If you cannot determine a payoff amount, estimate other closing expenses and let sellers deduct their payoff from the total after you have left.
Are the proceeds expected from closing enough of a down payment to buy the new property? Has the seller talked to a bank to verify that he qualifies for the new mortgage? Sellers appreciate agents who take this extra step and often reward them with plenty of referrals to family and friends.
Sellers are all different, but you'll find that agent experience is not usually their top priority. They are looking for a real estate agent who listens to them, is personable, explains exactly how their property will be marketed, and who is not evasive when they ask questions. Relax, be yourself, and you'll find that people will give you a chance to represent them.
