How NOT to Post a New Listing: Tips to Avoiding Lending Disasters

How NOT to Post a New Listing: Tips to Avoiding Lending Disasters

With all the legal and compliance rules, many listing agents are actually shooting themselves in the foot by over disclosing with excessive notes in their listings. All notes in a listing are available to appraisers when the property is being financed. Not all of these issues need to be disclosed in the listing on the MLS and instead should be disclosed in the Transfer Disclosure Statement (TDS). The reason is that many of these issues will not be discovered by the appraiser and therefore this takes the pressure off how many items have to be fixed before the close of escrow. Stating things such as the roof is shot or that there is significant dry rot or any other structural or repair issue will guarantee that these items will all have to be fixed prior to the close of escrow because any repair issues mentioned in the listing, the appraiser is required to add them to his or her report. As an agent, you are covered if all these items are mentioned in the TDS rather than the online MLS listing and you will have a cleaner funding. It is not illegal or considered a non-disclosure issue to leave these items out of the online-listing.

Contrary to popular belief, both conventional and FHA loans require any items that

affect public safety or code viloations, that are pointed out by appraisers, TO BE FIXED BEFORE THE CLOSE OF ESCROW unless you do a rehab loan. It is not true any longer that FHA is more stringent on property condition than conventionla loans. The FHA appraisal reform took place 7 years ago so there is no reason to discriminate against an FHA loan unless you are in a rural area and the sceptic tank is not more than 100 feet from the water source.

Ralph Migliozzi,

Broker Originator Serving Northern California 

NMLS 282851 DRE #01002038

(p) 530-330-3073