I’ve never been great at seeing goals all the way through. Prime example, if you look back at my blog I was planning on running 27 miles on my 27th birthday this year. Due to physical set backs I didn’t accomplish that goal. This year instead of making “goals” I thought of fun things I’ve always wanted to do, or enjoy doing and came up with a list of 6 things I want to try to do this year! We have a trip planned with some friends to Thailand in January so that already is a step towards number 4 on my list!
Dear New Agent,
Congratulations you’ve started a new career in Real Estate! You’ve already taken a HUGE leap of faith and for that I commend your courage. This might not be the easiest job, but man it can be rewarding!
There are a few things I wish I would have known before I started-
First, make sure you have money saved. The amount depends on where you are in life and where you live when starting your new career in Real Estate. I would encourage you to reach out to your Broker or another agent who is a little ahead of you to help you figure out the amount of money you need to have tucked away. I would ball park at least 2-4 months income and then around $2000 for classes, licensing, dues for REALTOR association, etc. Again, it all depends on your specific situation but there are upfront costs to getting started and then it will take a while until the first paycheck is in your pocket.
Second, choose the agency you will work for VERY wisely! It is so important to have a strong support system and training program in place when you first get started. This business is a lot of learning on the job, but if you are learning from people who do their job poorly or unethically then you’re already starting on the wrong foot.
Third, I would encourage you to ALWAYS think about people and how you are affecting others around you from day ONE. Notice that I didn’t say always put other people first, but just think about how you are affecting others around you. If you start getting greedy with clients or worried about how you can make the most money you will bulldoze right through friends, colleagues, clients, etc.
Fourth, ask questions and learn as much as you can right away. If there is another agent who has been doing this longer than you that you can learn from, don’t hesitate to ask if you can shadow him/her as they interact with clients and other agents. You can learn so much from observing how experienced agents handle situations.
Lastly, don’t get easily discouraged! There will be times this new job feels like you’re trying to run through mud and you’re getting no where. But if you took my second piece of advice then you have a fabulous team around you, ready to step in when it gets tough. If you can find a way to reward yourself with little victories to encourage yourself to keep working hard.
You WILL be able to make it! Try giving Real Estate at least 2 years before you decide if it’s the right career for you. It will feel tough or slow during that first year/going into the second year but find a way to push through and persevere before you throw your hands up because it’s “too hard”. Find a way to reward yourself for your accomplishments. (My husband and I pop a bottle of champagne every time I have a closing). And if you can surround yourself with a support system of friends/family that will be there for you when work feels overwhelming!
When I first meet with clients, I talk through the entire buying process. We talk about the process from the initial consultation with me, as their real estate agent, to the closing table, and everything that happens in between.
A question that I get asked quite frequently is,
“Mary Courtney, how much money will we spend on things from now until closing that isn’t included in our down payment?”
There are a couple items that you, as a buyer, could be responsible for:
First: Earnest Money
When I sit down with clients to write an offer, they will usually put some earnest money down. It’s basically good faith money that says “we’ve got skin in the game”! I typically advise clients to put down around 1% of the purchase price, but whatever they are most comfortable with. This money is held in an escrow account until closing where it is released to the attorney and goes towards closing costs/down payment amount.
After the contract is ratified, there are 10 business days to do any and all inspections. The inspections that we encourage our clients to get are: a full Home Inspection, an HVAC Inspection, and a CL-100 (termite) inspection. The average cost for these three are between $470-$700 depending on the size of the house and how many HVAC units are in the home. Other inspections that my clients have had done are: a pool inspection, a well inspection, aa septic tank inspection, a sprinkler system inspection, and a chimney inspection. As you can see, you can have inspection done that you’d like! The inspectors ask to receive payment at the time of the inspection so they can release the reports to the agent and client. If you are obtaining FHA or VA financing, a clear CL-100 (termite) letter is required, though the seller will usually credit you for this inspection at closing.
After the contract is ratified, and if it is important to you to know where your property lines are located, then we suggest ordering a survey on your property. Some clients like to ask the attorney to pull the most recent survey on file to see if it suffices, but if it is very important to you, then I encourage clients to order one within the 10 business days due diligence period. Surveys can cost anywhere from $450 and up, dependent on the lot and location and how easy it would be to find the metal stakes/landmarks to draw the survey.
Fourth: Closing Costs
There are items that are required to purchase a home, that are not included in the down payment, called closing costs. They include but aren’t limited to: deed stamps, attorney fees, lender fees, etc. Depending how the buyer would like to structure the offer, they can always ask the seller to pay for the closing costs. It is hard to estimate a dollar amount up front because a lot depends on what type of financing the buyer is using. Typically, we can work with the lender up front to determine an estimated amount that you would need.