The #1 Threat to Real Estate Industry

By Joe Lins
June 29, 2015

The National Association of REALTORS® (NAR) recently released the D.A.N.G.E.R. Report which stands for Definitive Analysis of Negative Game Changers in Real Estate. You can download a copy of the report HERE. NAR commissioned Swanepoel | T3 Group, an outside management consulting firm, to conduct an analysis of the threats, opportunities and trends in the real estate industry.

While there were many threats to the industry and our profession from outside the industry, there was one huge threat mentioned in the 160+ page report that comes from within the industry. According to the DANGER Report, the #1 threat to real estate professionals and the industry as a whole are other agents who are unqualified and/or incompetent. The Report says, “The real estate industry is saddled with a large number of part-time, untrained, unethical, and/or incompetent agents. This knowledge gap threatens the credibility of the industry.”

The Report cites the low state requirements to become a licensed real estate agent. The national average to get a license requires a measly 70 hours of training. Having the bar set so low to enter the profession or even remain in this profession is a recipe for trouble. Agents are allowed into the business with a very basic knowledge. That’s okay, you have to start somewhere. The problem is the brokers who hire these agents without providing any additional training or oversight and just letting them loose on the streets.

I see it firsthand every day. In California we have many forms and requirements that are constantly changing. What happens when the broker does not provide the ongoing supervision or training or insist the agent get it from through their local association? I can tell you from experience with agents from other firms, at times it isn’t pretty.

We recently had a new Residential Purchase Agreement (RPA) roll out in California. Our Executive Leadership team knew it was coming and prepared our agents over the course of several months by providing training on the new RPA. About a week after it went into effect, I got a phone call from one of our agents who was in a transaction with an agent from another firm. That agent knew nothing about the new RPA and didn’t know how to complete it. Our agent asked if we would be willing to train the other agent on the new RPA. I said “Absolutely!” A well-trained agent is good for everyone involved including the industry.

I’m not looking forward to the roll out of the new TRID requirements later this year. Not because it’s a new requirement. We’ve been talking to our agents about this for weeks and they will be receiving training so they are ready for the change. I’m dreading it because I know that most agents on the other side of the transaction will not have a clue. When that happens the person who will be the most vulnerable and frustrated will be the client. Their dissatisfaction is a negative impact on our profession and industry.

Yes, the training to become a license real estate agent is minimal. That is why it’s up to each broker and real estate association to have higher requirements to be affiliated with them. Every market and state is different but there needs to be a consensus from the leaders in this industry to raise the bar and hold the Brokers who don’t, accountable.

For those of us who believe this is a true profession and one that we consciously chose, this should be a no-brainer.

About the author: Joe Lins is President and Co-owner of CENTURY 21 Discovery. If you are interested in becoming part of the CENTURY 21 Discovery team contact Joe at 714.626.2069.

Creatively Saving For A Down Payment For Your First Home

By Shantell Lorraine Nicole Russell of New American Funding*
June 8, 2015
Originally Published on June 4, 2015

Rental rates are quickly rising making it more difficult to continue affording an apartment. While purchasing a home might seem like a less expensive option, saving for a down payment on a house is likely one of the more difficult aspects of becoming a home owner. One of the common standards for a down payment is 20 percent of the total value of the home. This can add up quickly and between mountains of student debt and the entry level job market, setting aside funds can be a challenge. However, with more lenient lending standards and a few tricks, you can start saving and become one step closer to owning a home of your own.

Understand the importance of a down payment
Before you begin planning to save up some extra cash, know how a down payment impacts your ability to become a homeowner. A down payment is the money you put toward a home right away. Zillow noted that the amount you can contribute upfront can impact the type of home mortgage you qualify for and ultimately how much house you can afford. In addition, your credit score and income also contribute to the home loan you ultimately receive.

This can help you determine how much you want to save for your future home. If you would like to purchase a more expensive home, but do not have the credit score or annual income to support higher monthly mortgage payments, providing a larger down payment can help ensure you still can afford a home more congruent to your preferences. Additionally, paying less than 20 percent of the total value of the home may mean that you need to also pay mortgage insurance on a regular basis.

Mortgage insurance is a way to back up a loan in case you are unable to make payments due to your financial circumstances.

Options for low down payments
If you are interested in acquiring a home without spending a great deal of money up front, Freddie Mac and Fannie Mae, government-backed lenders, both offer loans with 3 percent down payment options.

First-time homebuyers may qualify for these affordable options depending on their ability to provide specific information and meet certain standards to avoid underwriting mortgages. For example, Freddie Mac mandates that applicants can cover the closing costs as well as the full down payment agreement. Additionally, homebuyers must enroll in a borrower education program similar to the one offered by Freddie Mac. Fannie Mae also implemented similar requirements to combat lending money to an unsuitable candidate who is unable to afford a home.

Techniques for saving money
After deciding how much money you wish to save for a down payment, USA Today recommended setting up automatic contributions to your savings account every pay period. This ensures that you are not tempted to dip into your pot and spend any of your money before putting it into your savings account. In addition, automatically sending money to your savings account is a great idea as long as you have properly budgeted for a specific amount to be contributed regularly.

Developing an adjusted budget to accommodate your new efforts is an important step to the process. Decide how much money you need for your expenses, like rent, bills, food and any debt. Then allot additional money for recreational spending.

The Daily Finance also noted it might be a smart idea to keep your savings safely stored away somewhere that it is more difficult for you to access. Consider starting a high-yield savings account or CD.

Know where to make cuts
There are a number of frivolous expenses that can add up and prevent you from saving for a down payment on a house. Below are some extra expenses you might consider reducing to help increase your savings:

Making daily coffee shop runs
Eating out regularly
Going out to the bars
Going to the movies
Taking weekend trips
Having regular manicures or pedicures
Attending concerts, plays and other performances

Add additional income
If you are ready to purchase your first home as soon as possible, you may want to increase your annual income. Consider picking up a weekend job or increasing your overtime hours at your current job. Automatically put all extra incoming money into your savings account to help quicken the growth of your future down payment. Think about doing a little freelance work to increase your total income as well.

Additionally, if you receive any extra cash, such as a tax return or birthday money from a family member, contribute that toward your savings. Money Manifesto recommended pretending that this extra income does not exist and automatically depositing the extra funds to help with your down payment fund.

Becoming a homeowner is a substantial milestone. Start saving for your down payment if you are interested in making the step toward owning your very own property.

*Article reprinted with permission from New American Funding. Licensed by the California Department of Business Oversight under the Residential Mortgage Lending Act – License #4131117 Broker Solutions Inc. dba New American Funding (NMLS #6606) Corporate Office is located at 14511 Myford Road, Suite 100, Tustin, CA 92780. 800.450.2010

For more information about loan options contact
Chris Smith NMLS# 253394 at Chris.Smith@nafinc.com
Bill FitzMaurice NMLS# 290216 Bill.Fitzmaurice@nafinc.com

CENTURY 21 Discovery Visits the Comic Book Hideout

By Stephanie Goedl
May 1, 2015

This Saturday, May 2^nd is Free Comic Book Day. I had to opportunity to talk with Glynnes Pruett of the Comic Book Hideout in Downtown Fullerton about her shop and the events for the day. The Hideout has been voted the Best Comic Book Store in Orange County by OC Weekly and the OC Register. After taking a tour of the shop I can see why it’s so popular. Check out our conversation below.

The Comic Book Hideout will be open on Free Comic Book Day from 9am-8pm. Stop on by this Saturday for your free comic book. This is another reason why we love this community.

About the author: Stephanie Goedl is the Chief Operating Officer of CENTURY 21 Discovery. For more information about CENTURY 21 Discovery you may call (714) 626-2000.

CENTURY 21 Discovery at 2015 Donate Life Run/Walk

By Stephanie Goedl
April 25, 2015

A group of agents from our office participated in the 2015 Donate Life Run/Walk today at Cal State Fullerton. This annual event benefits the One Legacy Foundation which promotes organ donations.

We teamed up with the Leon Owens Foundation in honor of our friend Marv Owens. Marv received a kidney transplant in 2013. This event brings people together to honor or remember a donor or recipient while raising awareness of the need of organ donors.

Coming together for causes like this is one of the many reasons we love working in this community.

About the author: Stephanie Goedl is the Chief Operating Officer of CENTURY 21 Discovery. For more information about CENTURY 21 Discovery you may call (714) 626-2000.

Videolicious is a great marketing tool for Real Estate Agents

By Suzy Lins
April 21, 2015

Recently, a group of our professional REALTORS® attended a webinar by Alan Haburchak of Videolicious. Videolicious is an app you can use to create on the spot videos. It’s a great marketing tool for real estate agents to use to create a Listing Video, a “Come Check out my Open House” video or even a Client Testimonial video. It’s all done on your iPhone or iPad. Within about 15 minutes you can create the video and send it out to your social media sites, email to clients or upload to YouTube.

I know most of us don’t like how we look in photos let alone in videos. It took me a bit to get over how I looked on screen. But then I realized…that’s how I look. It was a blow to my ego but I got over it. If you can’t get over it and still don’t want to be on screen you can do a voice over of video clips and photos to create a marketing video.

I put together this short Videolicious video to show our agents just how easy it is and to motivate them to give it a try.

Our CENTURY 21 Discovery agents have access to an upgraded version of the app because of a partnership with Century 21 and Videolicious. Right now it’s only available on IOS products but there are plans for an Android version soon. Once you give it a try you’ll be amazed at how easy it is to use!

About the author: Suzy Lins is the Communications Director for CENTURY 21 Discovery. For more information about CENTURY 21 Discovery you may call (714) 626-2000.

Understanding Your FICO Score

By Courtney Lynch of New American Funding*
April 15, 2015
Originally published on March 24, 2015

Many of your financial investments depend greatly on one small three-digit number. Your FICO score dictates what kind of loans you receive and ultimately the purchase you can handle. It is important to be cognizant of your FICO score and know whether you need to make improvements to your credit.

What is a FICO score?
The National Association of Realtors noted that aFICO score determines your creditworthiness and it ranges between 300 and 850. Lenders consider borrowers with lower scores to be at a higher risk and those with higher scores to be at a lower risk. NerdWallet noted that your interest will correlate with your FICO score. Keeping your credit score low will save you money in the long run.

To determine how your credit score compares, speak with your financial adviser and know what is considered to be a good or bad score. Experian, a credit information service company, released its fifth annual credit study and 2014 showed the national average credit score increased two points from 664.

How is a credit score calculated?
The scoring model used by most lenders to determine your creditworthiness was developed by the Fair Isaac Corporation. There are a number of types of credit scores, but NAR reported most lenders prefer referencing FICO scores before providing a loan.

According to MyFICO, the scoring model uses five different categories to calculate a score. These include:

Types of credit used
New credit
Length of credit history
Amounts owed
Payment history

The types of credit used only accounts for 10 percent of how your FICO score is calculated while payment history makes a much larger and profound impact at 35 percent. Knowing which elements have the most profound effect on your score is important – especially when you want to improve your creditworthiness.

MyFICO also noted that your scores are not contingent upon your age, salary, current interest rates or whether you are enrolled in credit counseling.

Where is your score relevant?
When submitting a loan application, your credit score is always at the forefront of a lender’s mind. Given that creditworthiness determines how likely you are to pay back your loans, a good score is incredibly important when applying for a loan of any sort. Whether you are trying to obtain an auto or home loan, your FICO score can make or break you.

Freddie Mac reported that your credit is one of the most important and necessary elements of applying for a home mortgage.

What other factors may lead to a rejected loan application?
Opening multiple lines of credit and cosigning history are two additional elements lenders could potentially view as red flags, according to Bankrate.

Signing up for multiple credit cards in a short amount of time could alarm some lenders.

“That would raise some questions,” said Norm Magnuson, the vice president of public affairs for the Consumer Data Industry Association. “It could be an indicator of something that’s going on. I don’t think it’s in the best interest of any consumer to go out there and be a collector of credit lines.”

Cosigning is an additional factor that could impact whether you are approved for a loan. While you may not have to pay money when you help someone become approved for a loan, you may pay in other ways. When you cosign, you are also taking on that individual’s line of credit. If he or she does not have a good credit score, that can now be associated with your own creditworthiness.

In addition, if the individual you cosigned for decided not to make payments or turned them in late, these behaviors would count against you.

For more information about loan options contact
Chris Smith NMLS# 253394 at Chris.Smith@nafinc.com
Bill FitzMaurice NMLS# 290216 Bill.Fitzmaurice@nafinc.com

Apps for Home Buyers and Sellers

By Guest Blogger
March 31, 2015
This was originally published in the official blog of Century 21® on February 22, 2015*

When you are in the process of buying or selling a home, there are a lot of tasks that need to be handled. It can seem overwhelming, but with the right tools, you can stay organized and on top of everything that needs to be done. Luckily, there’s an app for that. Use these apps to help stay productive and organized during the home buying and selling process.

1. Evernote: Evernote is a note taking tool with lots of useful features that will help you stay organized on the go. Create separate notebooks for each step of the home buying process, for example: you could make notebooks for “Wants and Needs,” “Open House Reflections” “Financial Information,” “Closing Notes,” and more. You can even create bulleted lists, and attach photos and PDFs. Evernote syncs with all of your devices so you always have access to what you need.

2. Dropbox: Dropbox is essential for storing and organizing documents and paperwork. You have easy access to everything you need with the click of a button! Share documents or entire folders with your home buying team instantly so you’re always on the same page. Just like Evernote, Dropbox is able to sync with all electronics, giving you complete access to what you need!

3. CENTURY 21^® Real Estate: Our app allows you to quickly find listings, sales associates, and nearby open houses. The app is GPS enabled so you can search listings specifically targeted for your location. You can also search based on price range, features, estimated taxes, square footage, and much more.

4. AroundMe: Learn about your potential new neighborhood. AroundMe[MH1] uses GPS to determine your location and in an instant, you’re able to see how close everything, from gas stations to movie theaters, is to the potential home.

These apps will help you stay organized and productive during your home buying or selling process.

*Article reprinted with permission of Century 21 Real Estate LLC.

Saving Money on Your Mortgage

By Shantell Lorraine Nicole Russell of New American Funding*
March 22, 2015
Originally Published on March 19, 2015

Everyone loves saving money and your monthly mortgage payment is no exception. When you apply for a home loan or are thinking about refinancing, there are a few things you should consider to keep your payments more affordable.

Providing a larger down payment
While government-sponsored enterprises Freddie Mac and Fannie Mae are now offering loans with a 3 percent down payment option, paying more money up front can help keep your interest rates and monthly bill lower. Credit.com also noted that you can pay off your mortgage faster and this can leave you with the ability to access more spending money in the future.

Deciding on the right mortgage
There are a number of options available to individuals interested in purchasing a new home. The two main types of loans available are fixed- and adjustable-rate mortgages. According to Nerd Wallet, FRMs guarantee a specific interest rate over the course of the loan’s life. This is a great long-term option that you can easily organize your finances around. An ARM offers a lower introductory rate, but after a pre-determined amount of time the interest rate can fluctuate with the market.

Deciding on the best loan option for you depends on what type of loan fits your situation. You may not intend to use this mortgage toward your forever home. Perhaps you know that you are hoping to sell the house in the next five or 10 years. In this instance, an ARM with a lower interest rate would save you more money. However, if you are investing in a home you do not intend to move out of any time soon, an FRM might be a more dependable and ultimately more affordable option.

Lender-paid and borrower-paid mortgage insurance
Mortgage insurance provides protection for lenders if an individual is unable to pay back a loan. Zillow noted that there can be differences in the payments and rates associated with borrower-paid PMI and lender-paid PMI. Ensure that you consider the total monthly cost of PMI after tax deductions to decide which option is most cost-effective for you.

Shopping around for a mortgage
Before buying a new television, people usually check a few stores, browse the Internet and conduct a little research of their own. When you decide to purchase a new home, your hunt should be just as thorough, if not more intense to ensure you are getting the best deal. Bankrate noted that you can either shop for a loan yourself or hire a broker to do the hunting for you. If you decide to hire a broker, ask to speak with his or her clients before. They can offer you insight about the services he or she was able to provide for them.

You may also want to speak with your real estate agent about different lenders. He or she can direct you to a variety of options available and you can begin shopping for the best deal.

Consider paying extra
U.S. News and World Report suggested adding an extra payment each year. The additional payments are put toward your principal and help bring down the total amount you owe on your home and you will not have to pay as much interest on that total.

Making more payments on your mortgage now can ultimately save you more money on the total amount that you owe lenders. For example, if your current mortgage is $200,000 with a six percent interest rate on a 30-year FRM and you made one extra payment of $1,199 each year, you could not only save $47,000 but also cut five years off of your 30-year commitment.

Take a look at your current financial situation and determine whether this is a viable option for you.

Refinancing your mortgage to save money
While interest rates on home loans are low, you may find that refinancing is an increasingly appealing option. However, U.S. News and World Report noted that before you jump the gun and decide to refinance your home, you should calculate long term savings and the closing costs and fees you may accrue.

You should only move forward with this process if you have done the math and see that the savings make it worthwhile.

Another factor to consider is whether you are currently a good candidate for a new mortgage. Make sure that your credit score is healthy and you will qualify for a lower interest rate.
If you decide to refinance, remember that you should look at a few different lenders before committing. It is important that you find the best deal available.

Saving money is always helpful. Finding new ways to help with the cost of your mortgage can help your financial situation a great deal. Reach out to a professional, consider your options and make a plan to help you save money on your monthly payments.

For more information about loan options contact
Chris Smith NMLS# 253394 at Chris.Smith@nafinc.com
Bill FitzMaurice NMLS# 290216 Bill.Fitzmaurice@nafinc.com

Your Digital Presence is an Extension of Your Business Card

By Suzy Lins

February 9, 2015

Why does a real estate agent need a digital presence? During a recent New Agent Orientation at our firm I explained to our new recruits why they need a digital presence. What exactly is a digital presence? Simply, it means your online activity through either your website or blog, social media, comments you made on a video, etc. When someone looks you up online, all these should appear in that search. I like to think of it as an extension of your business card. That’s why it’s so important for REALTORS® to have some sort of digital presence.

Your digital presence is an extension of your business card

According to National Association of REALTORS® (NAR) 2014 Profile of Home Buyers and Sellers, 40 percent of buyers and 38 percent of sellers found their agent through a referral from a family member or friend. That same report stated that two-thirds of buyers and 70 percent of sellers only interviewed one agent before they found the one they wanted to work with. Most clients are not shopping around for agents once they get that referral but there is a pretty good chance they are checking you out before they call you. Google yourself to see what shows up. Is this a good representation of you and your business?

The same NAR research showed that 92% of buyers used the internet in some way during the home buying process. Many buyers find the homes they are interested in online and sellers go to third-party aggregator sites to get an idea of what their home is worth but very few find their agent online. The reality is that everybody knows somebody who knows somebody who is in real estate. If not, they’ve been living under a rock! If I was looking someone to help me make the biggest purchase of my life, first, I’d get a referral and then I would probably check them out before I called them. I’d “Google” them. That’s why it’s so important for real estate agents to have a digital presence that is current.

While there are a lot of ways to beef up your digital presence, these are the 3 things I tell our agents to focus on right away:

LinkedIn – Get a LinkedIn profile with a professional photo and complete the profile with your experience, education, certifications, volunteer work, etc. If you don’t have a professional photo headshot, get one. We have a local photographer that will take 12 professional portraits with the proper lighting and background and give it to you on a disk for $75. You own the photos and can use them across all your marketing efforts. On that same note, if your photo is more than five years old get a new one. It drives me crazy when I see agents use a photo from 20 years ago. I hate to break it to them that they don’t look anything like that anymore.

Website – Get a personal website. There are plenty of affordable websites out there for real estate agents. Through Century 21 every agent in the system is provided a free website. These are template based sites that allow the agent to personalize them with their own information. FYI – Most buyers will probably not go to an agent site to start looking at homes. They will most likely go to sites like Zillow, Realtor.com, Trulia, etc. But when that potential client does research you, that site will come up in their search results. It’s another way to show you’re knowledgeable and legit.

Facebook – For those who are already on Facebook I recommend they create a Facebook business page. This is an easy way to market yourself and your listings within your own circle of influence. Facebook business pages also have the ability to do micro-targeted advertising at just dollars a day. It’s a great tool for advertising that new listing or an Open House. Also, since Facebook is the largest social media site out there it will appear high in a search engine ranking when you get “Googled”. One other thing I tell our agents is that if they are going to have a Facebook business page they need to post to it regularly. I suggest a minimum of three times per week. You don’t want people coming across your Facebook page only to see you haven’t posted anything in six months. That looks like you don’t care and are not engaged in your business. Plus Facebook makes it easy. You can schedule your posts in advance.

Additionally, I recommend that every agent set up a free profile on third-party real estate sites like Realtor.com, Zillow, Trulia. These sites allow you to customize your profile, show your recent sales/listings and even get client reviews.

There are many more ways for agents to market themselves, but this is what we recommend to our agents as they begin to develop their digital presence. Remember, just think of it as an extension of your business card.

About the author: Suzy Lins is the Communications Director for CENTURY 21 Discovery. For more information about CENTURY 21 Discovery you may call (714) 626-2000.

What’s Your Value?

By Joe Lins

January 5, 2015

Our Leadership Team at CENTURY 21 Discovery recently held our annual strategic planning meeting for 2015. At that meeting we set aside a portion of the day to review and discuss our Value Package. We wanted to make sure every member of our team knew the value of what we provide to the agents at our firm as well as being associated with the Century 21® brand.

A few months before we presented it at our Strategic Planning Meeting, the owners and Chief Operating Officer sat down to review and update everything we provide to our agents when they come to work at CENTURY 21 Discovery.

I include this value package review process as part of my weekly coaching session with our agents. A Value Package should be a part of every REALTORS® arsenal that they bring out when they meet with a potential client or go on a listing presentation. It can be as simple as bullet points of the services provided to the client and how it will benefit them. Whatever format it is, it should be what sets you apart from the other guys.

I do this every time I recruit a new agent or counsel a current agent who is being wooed by another brokerage. I have to show them what we offer versus what they will get at another firm. Just like the agents who are competing for listings with other agents we are competing for good agents with other firms.

Along with all the training, office equipment and supplies we provide to every agent, I have to remind them about the 40 years of branding that Century 21 has. Aligning with the most recognized brand in the industry allows the agent instant recognition of what they do. Alignment with XYZ Company does not promote this sense of stability and longevity with today’s consumer. I also explain that being a part of our firm ensures a high level of support and knowledge they probably won’t get from a competing firm.

Here’s a story to highlight what I mean. In California, they rolled out a new Residential Purchase Agreement (RPA) in November of 2014. Months before it came out members of our leadership team attended seminars and classes to learn about the new RPA so we could train our agents. Over a period of weeks we held classes to ensure our agents were familiar with the new contract once it came out.

By the time the new RPA became a requirement our CENTURY 21 Discovery agents were well versed in it and ready to do business. Our agents encountered many, many agents on the other side of transactions who either had no clue that there WAS a new RPA or if they did, they had not been trained on it. Their brokerage had not prepared them for a major change in the industry. I even had one agent ask me if I would train the agent on the other side of her transaction. I said, “Of course!” I’d rather have our agents in a transaction with other agents who know what they are doing.

The value our firm provides to our agents encompasses the basics like office supplies and equipment along with the bigger things like training, knowledge and a pro-active involvement in industry changes. That’s our value. What’s yours?

About the author: Joe Lins is President and Co-owner of CENTURY 21 Discovery. If you are interested in becoming part of the CENTURY 21 Discovery team contact Joe at 714.626.2069.

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