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The whole closing costs game is a sham designed to separate more money from the buyers pockets and feed the real estate conglomerate.
Actually, the seller is coughing up money to clear the mortgage the bank owns.
There would be significant shift in the market and an increase in transactions once people realize they could buy and sell real estate without tens of thousands of dollars in fees being siphoned to the real estate industry.
Homes would sell for less, because most sellers have no clue how to stage and market their properties.
Deals would fall apart because most sellers have no idea how to prequalifyvsomeone, how to guide buyers to good lenders that do good preapprovals and close on time.
More lawsuits would be filed by buyers against sellers for not disclosing properly. Or from buyers against sellers after the fact under DCTPA because sellers hid things.
More deals would fall apart over inspection issues because buyers don't understand what certain things are and make a mountain out of a molehill, or sellers don't understand that now known issues must now be disclosed. Or buyers wouldnt have someone guiding them to get certain things inspected that may be common to that area (termites, radon, soil shifting), so they end up having issues with financing falling thru when the issue is required to be corrected in order to close a va or fha loan.
More buyers would find themselves owning a home that they can't get their money out of when they need to sell, because they bought a home in a bad area, or with an uncorrectable downside (busy street, bad school system, unpopular style for the area (like tri level homes here), poorly run hoa, flood zone, etc). Without an agent, they may not be able to get accurate comps. Even what you see as sold on zillow or realtor.com doesnt show accurate prices at times, nor do they ever show concessions, which could radically change value (ie, seller paying 8k for closing costs).
Early on in my buying and selling experience, I required a lot more hand holding. Now that I am more savvy, I prefer to take more of a lead on the transaction. I shop for my rates independently, vet my own listings to check out, and direct more of the negotiating and marketing.
I've exclusively used online lending services, even though I've been warned against them plenty of times by traditionalists. There are so many reputable online lenders today that it shouldn't be a problem finding a good one. I've never had a problem closing with them, and they save significantly on loan origination fees and other costs.
I've only used a traditional listing and selling agent, but this time around I explored services like Redfin that offer lower listing fees of around 1.5% and a buyer's rebate if you buy with them. We figured most rebates to be about around .007% of the sale price in our market. The caveat is that Redfin is for buyers and sellers who shouldn't expect as much of the hand holding and white glove service as a traditional agent/broker. However, I was able to leverage a deal with Redfin to negotiate lower costs with my current listing/buyer agent.
Again, I don't require a lot of hand holding at this point, and if that's the case for you, perhaps research some of the modern, unconventional RE services that are available. I just need someone to list us on the MLS, keep us on schedule, market us well, move the contractual paperwork along, and provide official representation on my behalf. It is nice to have someone to bounce ideas off of, and that has been the benefit of working with a more traditional agent/broker service.
How we bought a home (and pretty much everyone else we know did in the last 10 years):
Listing agent staged, took pictures, put online, and stuck a sign outside.
We drove by and then found house on internet. We were cheezed bc our buyer's agent didn't even tell us about it.
Buyer's agent made appointment
and unlocked door.
We said, "Yup. We like it."
Wrote contract. One back and forth.
House sold in a week.
The whole closing costs game is a sham designed to separate more money from the buyers pockets and feed the real estate conglomerate.
Actually, the seller is coughing up money to clear the mortgage the bank owns.
There would be significant shift in the market and an increase in transactions once people realize they could buy and sell real estate without tens of thousands of dollars in fees being siphoned to the real estate industry.
you provided some wonderful "non-answers".
1. You stated (and perhaps want to admit error, or restate somehow):
"closing costs go into the agents pockets" - which is just patently false. Exposed on this inanity, you chose to then proclaim some shadowy "conglomerate" jacked up costs in a collusive manner just to screw the Buyer.
2. If the Buyer pays "everything" from their purchase price, then it's not the Seller "coughing up money to clear the mortgage" ... because in fact, that money never leaves the settlement agent to go to the Seller.
And in my case, the Buyer pays the mortgage, but the Seller is legally on the hook for ANY expense over the Buyer's purchase price.
3. Every expense EXCEPT commission would remain in a "FSBO Only" world. And we've always been in a "FSBO is Legal" world ... and transactions have gone UP not down via the use of real estate agents. And despite significantly better avenues available to FSBO, the number of pure FSBO's remains fairly constant/slightly declining.
While I do believe the current real estate market system, commissions, closing costs, etc. is an archaic system, you are coming in from left field. You remind me of the person that won every battle but still does not understand why they lost the war.
If at 25 one is not an idealist, they do not have a heart.
If at 45 one is not a realist, they do not have a brain.
While I do believe the current real estate market system, commissions, closing costs, etc. is an archaic system, you are coming in from left field. You remind me of the person that won every battle but still does not understand why they lost the war.
If at 25 one is not an idealist, they do not have a heart.
If at 45 one is not a realist, they do not have a brain.
Paying close to 100K in RE commissions and closing costs for two property purchases in 4 years has created a severe dislike for the current system.
Paying close to 100K in RE commissions and closing costs for two property purchases in 4 years has created a severe dislike for the current system.
I don’t like gravity either but I work with it to my advantage. Earlier you said $85K, I guess inflation is high where you are to go from $85K to close to $100K in a matter of days
that's a second round of transactions. I assume he's only counting his 2 purchases, not 1 or more sales.
It would be insightful to understand why he moved 2x in 48 months though
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