When it comes time to sell your Orlando vacation home the last thing you want to deal with are those little hiccups that might prevent your property from selling or complicate the transaction. One of the biggest problems we often run into when selling a fully booked and turnkey vacation home is property managers who are not cooperative. Because they are the ones controlling most of the access and information about your home, they often have the power to make or break your sale. You can hire the most established, wonderful and highly recommended Realtor in the great town of Orlando but if your property manager isn’t on board with the sale than you can count on it sitting on the market a very long time. Over the years we have seemed to narrow down some of the reasons they might fight against this and what you can do about it in advance so you don’t run into issue:
1. They are Worried They Will Be Losing the Home to a Different Management Company
It’s natural for a property manager to become insecure and concerned about losing your home from their portfolio and naturally so. They have bookings already in place that they will have to move around if your home is removed from their program after it closes. The best thing you can do is to ensure your property manager understands that you and your Realtor will provide an excellent recommendation to the future buyers and that your Realtor makes sure that the home is advertised as a turnkey property and all bookings stay as long as the management company stays. What sometimes happens is, in a desperate attempt to convince the current buyers to stay with them, the property managers will over promise and exaggerate the homes future bookings and past performance. This only misleads the buyer and causes problems later on during the transaction.
2. They Are Offended You Didn’t Use Them To Sell Your Home
Most property managers also have a real estate license and are able to sell your home. If they don’t they are usually affiliated with someone who is. This doesn’t mean that it is the best choice for you to use. Because they are property managers and their main business is property management, not real estate, they usually do not have the facilities, experience or infrastructure in place to effectively market and sell your home. Any agent can slap your home on the MLS but a true vacation home Realtor will go 10 steps above that with a proven sales system that they have used time and again. Property managers should manage property and Realtors should sell property. To do both is to become half as effective and that is not fair to the customer, which is you. Sometimes, the property manager becomes non-communicative with the Realtor in hopes to prevent their efforts of selling the homes. It sounds crazy and unprofessional but we run into these road blocks all of the time! Be sure your property manager give 100% access to any and all marketing materials that your agent needs to place inside your home in order to help facilitate the sale. Sometimes they will not allow Realtors to advertise that the home is for sale both inside and outside of the home. Your home loses tons of exposure from this.
3. They Are Afraid of Being Exposed
This is the rough part that your Realtor faces when trying to sell your property. They cannot lie or exaggerate how many bookings are in place to try and attract potential buyers however, the only way they can know how much income is being brought in from that home or its past performance is by relying on what your property manager says. Your Realtor is going to have to provide documents that prove this income is actually coming in and has in the past. Without the booking history and future booking documents for your home most buyers, who want something turnkey, will walk away as your home has no credibility at that point. By not providing those documents your property manager can kill your sale during the due diligence period. If your property manager will not provide these documents to your Realtor or you that you than it might be time to question whether they really have as many bookings in place as they are claiming to. It’s also a great marketing tool for your agent to be able to quote how much income your home produced the past two years.
As much as it sounds like property managers are the bad guy, it’s not the case with all of them. There are hundreds of property management companies in the Disney area and about a handful of them provide a high level of service, are professional and most important honest. Our job is to seek those companies out and align ourselves and our clients with the most honest and ethical companies. Not the companies who want to pay us to refer them homes. The Flamingo Group never accepts referral fees from any management company for sending them business as we feel it’s a conflict of interest. We’re also experienced in dealing with difficult property management companies and are prepared to do what it takes to get your home sold regardless of the road blocks that may pop up ahead. To find out more about how we can help sell your vacation home and our one of a kind marketing system, please contact us today for a no obligation consultation.
According to NAR Vacation Home Buyer Statistics, many of you wonderful Disney area real estate buyers are from the UK. Because Real Estate in Orlando in very different than in the UK I’ve decided to post this UK to US Real Estate glossary for all of you out there reading from afar. I hope this helps with your Disney area real estate purchase!
Agreement in Principal (known in the United States as Appraisal)
An assessment made by British Mortgages Abroad of an applicant’s ability to pay for a home and confirmation of the amount the applicant may borrow.
All Inclusive coverage (known in the United States as Homeowner’s Insurance)
Insurance coverage protects your property and any structure attached to it, like the garage or screened porch. Any materials on your property that are being used to extend or repair the fabric of the building, such as timber or bricks being used for an improvement, would also be covered.
A form commonly referred to as a 1003 form, used to apply for a mortgage and to provide information regarding a prospective mortgagor and the proposed security.
Application Fee (known in the United States as Origination Fee)
A fee charged by the lender to cover the administrative costs of setting up a mortgage. This will include the preparation of documents and certain processing expenses in connection with completing a mortgage account.
Building Insurance (known in the United States as Hazard Insurance)
Insurance protecting against loss to property caused by fire, some natural causes, vandalism, etc., depending upon the terms of the policy.
Completion (known in the United States as Closing)
In property transactions, the delivery of a deed, the payment of the purchase price, the signing of notes, and the paying of closing costs, which completes the transaction.
Completion Date (known in the United States as Origination Date)
The date on which the loan is funded.
Counterpart Contracts (known in the United States as Agreement of Sale)
A written document in which a purchaser agrees to buy properties, which the vendor agrees to sell, under certain agreed conditions. Also known as a “Sales Contract”.
Credit Report (same)
A report on an individuals historic willingness and capacity to make payments in accordance with their loan agreements in the past. This report is provided to British Mortgages Abroad by an outside credit-referencing agency.
Decision in Principal (known in the United States as Pre-Approval)
A process in which British Mortgages Abroad will offer a decision in principal. This opinion is based entirely on the credit search history available to British Mortgages Abroad. The pre-approval is not binding and not necessarily accurate because British Mortgages Abroad will not have yet verified the application details.
Deposit (known in the United States as Down Payment)
The agreed percentage of the purchase price the buyer pays, in cash, at the time the property transaction closes (“completes”).
Direct Debit (same)
A method to set up a regular payment to be automatically paid from a bank account.
Disbursements (known in the United States as Closing Costs)
The various expenses involved in closing a property transaction that are in addition to the purchase price. Closing costs will include title insurance fees and other relevant charges such as a Credit Report fee.
Equity Release (known in the United States as Cash-Out Refinance)
A refinance transaction in which the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage, closing costs and the amount required to redeem other mortgages against the property. In short, a refinance transaction in which the borrower receives additional cash that can be used for any acceptable purpose.
Estate Agent/Property Developer (known in the United States as Realtor)
A real estate broker or an associate holding active membership in a real estate board affiliated with the National Association of Realtors. Unlike estate agents Realtors in the United States must be licensed by the state in which they are selling property and must follow up with continuing education every 2-4 years.
Flat (known in the United States as Condominium)
A structure of two or more housing units. Only interior area of a particular unit is individually owned. All the owners of the individual units jointly own the remainder of the property (land, building and other amenities).
Flood Insurance (same)
A form of insurance designed to protect property owners from loss due to the defined peril of flood. It is required for properties located in federally designated flood areas.
Insurance Schedule (known in the United States as Homeowner’s Insurance Declaration/Insurance Schedule)
A document accompanying a homeowner’s insurance policy whose purpose is to verify that the property quoted in insured.
Money paid to the lender for the use of borrowed funds, usually expressed as an annual percentage.
Loan Term (known in the United States as Maturity)
The term of the loan, or the number of years for which the loan funds are advanced.
Loan To Value (LTV)
The percentage size of the loan in relation to the value of the property.
Mortgage Conditions (known in the United States as Loan Terms)
Necessary conditions of a loan which specify the amount borrowed, interest rate, maturity, method of repayment, etc.
Mortgage Payment (same)
The regular monthly payment that a borrower agrees to British Mortgages Abroad.
Offer of Advance (known in the United States as Commitment Letter)
A formal offer by the lender which states the terms under which it has been agreed to lend money. Also known as a “loan commitment.” This letter will indicate the conditions that must be satisfied before release of funds.
Open Market Value (known in the United States as Fair Market Value/Market Value)
A figure that is the highest amount a purchaser would agree to pay for a property and the lowest amount the vendor would be prepared to sell at.
Pre-Contractual Stipulation (known in the United States as Contingency)
A clause or condition within a contract stating what the buyer or seller must satisfy before the purchase can be completed.
Prepayments (known in the United States as Prepaids)
Those expenses of property which are paid in advance of their due date and will usually be pro-rated upon sale, such as taxes, insurance, rent, etc.
Procuration Fee (known in the United States as Commission)
An agent’s fee for negotiating a real estate or loan transaction, often expressed as a percentage of the purchase price or the loan amount.
Promissory Note (same)
Your loan agreement with the lender detailing all the rights, obligations and conditions of the loan.
Purchase Contract (known in the United States as Sales Contract)
A written agreement between the vendor and purchaser stating the conditions that need satisfying for the sale to complete. Also known as an “Agreement of Sale.”
Redemption (known in the United States as Payoff)
Complete repayment/settlement of the principal balance along with interest and any other amounts due. The payoff of an account occurs either over the full term of the mortgage, through monthly repayments, or through early redemption.
Redemption Penalty (known in the United States as Prepayment Penalty)
A charge a borrower pays to redeem or part redeem a loan before it is due.
Redemption Penalty Clause (known in the United States as Prepayment Clause)
A clause that confirms the amount of the principal balance of an account the borrower may pay earlier than expected with or without penalty. The terms acceptable to British Mortgages Abroad vary acconding to the product selected.
Remortgaging (known in the United States as Refinancing)
Taking out a new loan to pay off an existing mortgage. This is usually done to obtain a lower interest rate or to borrow further funds against the equity in a property that may have built up since the original purchase.
Rental Property (known in the United States as Income Property)
Properties owned with intention of producing an income. Also referred to as “non-owner occupied property” or “rental property.”
Repossession (known in the United States as Foreclosure)
Legal Process by which a borrower in default under the terms of a mortgages ceases to have an interest in the mortgaged property. This usually involves a forced sale of the property at public auction with the proceeds of the sale being used to reduce or clear the mortgage debt.
Security (known in the United States as Collateral)
Any property given as security for repayment of a debt.
Self Declaration (known in the United States as Low-Documentation)
Below a stated LTV, British Mortgages Abroad only require the applicant to state the source and the affordability of the mortgage applied for, without providing supported documentation payslips or trading accounts.
Settlement Statement (known in the United States as Closing Statement)
Can be known as the “HUD-1″. The final statement of costs to be paid to close a loan or to purchase property.
A map executed by a licensed surveyor, which sets down precisely the boundaries of a given property as well as improvements, references to known landmarks, and the property’s principal features.
Title Company (same)
A company that checks the title of the property you want to buy. If they are satisfied with their enquiries they will provide you and the lender with the reassurance of insurance cover to protect your future interests (see below for definition of Title Insurance).
Title Deeds (known in the United States as Certificate of Title)
A written document stating that the title to a piece of property is legally vested in the present owner.
Title Insurance (same)
The insurance that protects British Mortgages Abroad, along with the homeowner, if an owner’s policy is purchased against losses resulting from problems with the title of the property, or unknown liens (charges) or other inconsistencies relating to the title of the property.
Title Search (same)
An examination of public records, laws and court decisions to identify any material facts regarding liens (charges) along with ownership of any given property.
Total Charge for Credit (known in the United States as Finance Charge)
Charges levied by British Mortgages Abroad that include all of the interest due over the life of the loan, in addition to certain other charges related to a loan.
Truth-in-Lending Act (TILA)
A law applicable in the United States requiring disclosure of the credit terms of finance transactions using a recognised format. This is intended to help borrowers compare the lending costs, terms and conditions of different lenders. Also known as “Regulation Z.”
Underwriting (known in the United States as Loan Processing)
Steps taken by British Mortgages Abroad from the time a loan application is approved or declined. This process includes receiving the application, credit searches (investigation) and the overall underwriting assessment of the application.
Unencumbered (same and also known in the United States as Clear Title)
Title not burdened by mortgages, charges (liens) or legal questions.
Valuation (known in the United States as Appraisal)
An estimate of the market value of a piece of real estate made by a competent professional (the appraiser) who knows local property and prices.
Villa Management (known in the United States as Property Management)