Unit 6
Where is the BEST place in the house to make the listing presentation?
At the dining room table
Which part of the CMA shows overpriced listings?
Expired listings
A seller's equity is the same as the net proceeds from sale.
False
If a seller initially expresses disinterest in a listing agreement, you should not continue to pursue business with that seller.
False
It is all right to make a listing presentation when one of the parties who needs to sign the listing is not present.
False
The licensee should go over the sellers' net proceeds form before discussing the CMA.
False
On the seller's net proceeds form, which proration should NOT be included?
Insurance
A broker is compiling a seller's net proceeds form for a seller. The figures she gathers are as follows: Brokerage fee 7% Title insurance $ 780.00 Termite inspection and treatment 300.00 Sales price 127,500.00 Existing first mortgage @ 10% 98,601.60 Documentary stamps on deed ? Property taxes for the year 1,745.60 Interest proration (paid in arrears) ? Closing date June 30 What are the total prorations, rounded to the nearest $100? Will the prorations be added or subtracted from the equity?
The answer is $1,700 subtracted. Property taxes for the year are $1,745.60. One-half year's taxes charged to the seller are $872.80 ($1,745.60 ÷ 2). Interest on mortgage = $98,601.60 × .10 = $9,860.16 per year; $9,860.16 ÷ 12 months = $821.68. $872.80 + $821.68 = $1,694.48 total prorations charged to seller; round to $1,700.
A broker is compiling a seller's net proceeds form for a seller. The figures she gathers are as follows: Brokerage fee 7% Title insurance $ 780.00 Termite inspection and treatment 300.00 Sales price 127,500.00 Existing first mortgage @ 10% 98,601.60 Documentary stamps on deed ? Property taxes for the year 1,745.60 Interest proration (paid in arrears) ? Closing date June 30 What are the total expenses, rounded to the next highest $100?
The answer is $10,900. $8,925.00 ($127,500 × .07) brokerage fee + $780 title insurance + $300 termite inspection + $892.50 documentary stamps ($127,500 ÷ 100 × .70) = $10,897.50 total; round to $10,900.
A broker is compiling a seller's net proceeds form for a seller. The figures she gathers are as follows: Brokerage fee 7% Title insurance $ 780.00 Termite inspection and treatment 300.00 Sales price 127,500.00 Existing first mortgage @ 10% 98,601.60 Documentary stamps on deed ? Property taxes for the year 1,745.60 Interest proration (paid in arrears) ? Closing date June 30 What are the seller's net proceeds, rounded to the nearest $100?
The answer is $16,300. $28,900 seller's equity - $10,900 expenses - $1,700 prorations = $16,300 seller's net proceeds.
A broker is compiling a seller's net proceeds form for a seller. The figures she gathers are as follows: Brokerage fee 7% Title insurance $ 780.00 Termite inspection and treatment 300.00 Sales price 127,500.00 Existing first mortgage @ 10% 98,601.60 Documentary stamps on deed ? Property taxes for the year 1,745.60 Interest proration (paid in arrears) ? Closing date June 30 What is the seller's equity, rounded to the nearest $100?
The answer is $28,900. The seller's equity is calculated by deducting the mortgages from the sales price. $127,500.00 sales price - $98,601.60 mortgage balance = $28,898.40 seller's equity; round to $28,900.
The reason for eliminating cents and rounding to the nearest $100 on the seller's net proceeds form is to
The answer is accomplish all of these. The reasons for eliminating cents and rounding to the nearest $100 on the seller's net proceeds statement are to (1) avoid giving the impression that the figures will be exactly as shown at closing; (2) make the statement easier to understand; and (3) provide a cushion in the estimate.
Which is NOT one of the three major problems in showing the property a FSBO might expect?
The likelihood that the seller will save the commission.
A FSBO sign can adversely affect the sellers' security.
True
Asking sellers to help you with measuring the house is a way to build rapport.
True
Asking whether the sellers would like you to try to get the home into the MLS as soon as possible is an effective method of asking for the listing.
True
Before making a listing presentation, you should have prepared a comparative market analysis (CMA) to help you show the sellers a fair value for their house.
True
Discussing the present condition of the property is a part of the homeselling process time line.
True
The principal reason that FSBOs try to sell their own homes is that they want to save the commission.
True
When preparing the interest proration on a seller's net proceeds form, the BEST policy is to enter
a full month of interest.
The final step in the listing presentation is
asking for the order.
The preferable approach to setting the listing price is to
go over the CMA carefully and help the seller to arrive at an appropriate range of values.
The base of the pricing pyramid shows
many buyers at lower prices.
When helping a seller price a property, a licensee should NOT
recommend a price before going over the data in the CMA.
The components of the seller's equity section of the seller's net proceeds form include
sales price, mortgages, and seller's equity.
If the sellers want to list the property before you have completed the listing presentation, you should
take the listing.
When explaining the current market conditions to the seller, one piece of information that would NOT normally be included is
the aggregate square footage of all listed homes.
A broker is making a listing presentation to a FSBO. She completes the CMA and the sellers agree to accept the net amount shown on the seller's net proceeds form. She should be able to take the listing now primarily because
the commission is included on the seller's net proceeds form, and the sellers have agreed to the amounts shown.
The reason it is not practical for a licensee to determine the exact prorations on the seller's net proceeds form when taking a listing is that
the exact closing date is unknown.
The reason MOST FSBOs won't be able to save the commission is that
the prospective buyer is buying direct to save the same commission.
