Commonly Used Forms

The Buyer Agency Confirmation Form is used to let you know for whom an agent is working. When you visit a new home development the agents on-site will usually ask you to sign this form. If you call a company and an agent shows you property, that agent is required by law to ask you to sign this form. Signing the form indicates that the agent has told you whom he/she represents. It does not obligate you in any way.

The Exclusive Buyer Agency Agreement enables the agent of your choice to work solely in your behalf. You may safely assume that all other agents are obligated by law to work for the seller. This is the form you will sign only if you are comfortable working with a particular agent. You should make sure that you could easily cancel this agreement if you are not getting exceptional service.

The Dual Agency Addendum is signed at the time you sign the Exclusive Buyer Agency Agreement if you agree to allow your buyer agent to represent you during the purchase of any property listed by the agent's company.

The NC Property Disclosure Statement is one of the few forms that all sellers (even FSBOs) are supposed to complete about the material condition of their property. It does not relinquish your responsibility to heed the advise of "buyer beware". Selecting an experienced buyer agent, having a thorough home inspection, pest inspection, survey, home warranty insurance, title insurance, homeowners insurance and flood insurance are precautions buyers should use to safeguard their investment. Completed copies of this form are often available at the houses you tour. If not, you can have your buyer agent request one from the listing agent.

The Offer to Purchase and Contract has been developed and refined by the N.C. Bar Association and the N.C. Association of REALTORS. It has been proven over the years to work for most situations. If you or your agent have doubts as to whether your transaction needs additional legal wording, by all means see a local real estate attorney. The Special Provisions and Conditions Addendum is a supplement to the Offer to Purchase and Contract. Included are the most common situations that a buyer might want to add to the Offer to Purchase and Contract. As a rule, if you cannot fit the additional items in paragraph 16 of the Offer to Purchase and Contract, you probably should include this addendum.

The Buyer Agent Commission Confirmation Agreement is a form that lets the seller, seller's agent, listing company, buyer agent, buyer agent's company and the buyer know how the commission for a particular property will be disbursed at closing.

 

Writing an Offer to Purchase

Once you have decided to make an offer on a particular property, your buyer agent will accumulate information on the property, on recent sales and on the neighborhood from the MLS, tax records and any other available sources. The process is similar to the competitive market analysis that the listing agent performed for the seller when pricing the property. Hopefully three nearby and similar properties (location, size, age, etc.) have sold within the last six months. Adjustments are made for significant differences among the properties.

An experienced agent will help you get all of this empirical information into perspective so that you can make an offer that is in your best interest without affronting the seller.

Once you've established value, the next challenge is to minimize risk. The home inspection and the wood destroying insect inspection are designed to catch structural, mechanical and operational problems. A survey should reveal right of ways, easements and encroachments on the property. Home Warranty coverage can help defray the cost of mechanical failures and title insurance can reduce the cost to correct title errors.

Still there are many more threats to your property investment that can range from obsolete wiring to friable asbestos or underground storage tanks to the presence of synthetic stucco. The more experience and training the agent has, the more likely a complication will be recognized and handled properly through the writing of the offer. Line 16 of the Offer to Purchase and Contract is one place to address special concerns and the Special Provisions and Conditions Addendum is another.

 

Negotiating

A savvy seller will price his property just above market value. A common mistake is to price well above market value, then add something for a negotiating margin and before long, the seller either has no showings, no offers or a low-ball offer. Smart buyer agents will research when and how much the seller paid for his house; the "sold price" of every other property in the neighborhood over the past three years; and probably do a market analysis on the sellers home if needed.

I advise sellers and buyers to negotiate as if you were playing bridge. If the buyer opens with a low bid, rather than feeling offended and making no response, the seller should come back with a small counter that sends the message that the offer was simply too low. On the other hand, if the buyer makes an initial offer very close to what the seller had hoped for, the seller should think twice before rejecting it with a counter. Some of the best offers are the first early offers.

Always find out what is the primary objective of the buyer and seller. Is it price, timing, terms, etc.? If each party's primary objective is different, a win-win agreement is very possible. In a buyer's market, the buyer has the advantage of being able to walk away from a seller's property and buy one of many others for sale. My advice to both buyers and sellers is to stay calm, rational and flexible. Keep focused upon where you want to end up and realize that there are many ways to get there. The best deals are those where both parties walk away winners, not walk away over a $1,000 difference!

If you have any further questions at all, feel free to contact me.

Bob Jamieson, Broker
CRS, ABR, GRI

Intracoastal Realty Corporation
1900 Eastwood Road at Lumina Station
Wilmington, North Carolina 28403

Toll Free 877.505.5272
Business 910.232.1893
Fax 910.397.2825

email bob@bobjamieson.com
web www.bobjamieson.com