Mechanic's Liens - Avoiding the seller nightmare!

Have you ever heardof a Mechanic's Lien?...If you haven't, let me enlighten you-  a Mechanic's Lien (sometimes called a Construction Lien) is a security interest taken in a property by contractors or other workers who have not been paid for their work. This type of lien can apply to anyone who has provided work, improvements, construction, materials  or goods to real property. To be technical, the minimum amount is $10.00, however paltry that may sound to you. A Mechanic's Lien against your property will preclude you from selling your home until the amount is satisfied, and it will have to be recorded in Town Hall as public notice, just as the lien was.

To reiterate, a Mechanics Lien  can be placed upon your property by ANYONE that performs work on your property and has a claim against you for non-payment . If you have sold your home before, you might recall that your attorney always asks you if anyone has performed work on the property in the last 90 days.  It may seem like an odd question, but your attorney asks you that for a reason. If you have had work done within the past 90 days, and have not paid for the work performed, there is a chance that a Mechanics Lien can be filed against your property. The reason for this seemingly innocent question is that any lien statement must be filed no later than 90 days after the supplies are delivered or the last day that work has been performed.

The work must be agreed to by the owner of the property and can occur on the building, in the structure itself,  or within the confines of the property owned. Besides the fact that the buyer will be unable to obtain Title Insurance for the bank, they may not be able to obtain the loan for your property because Title Insurance is required by the bank for a mortgage. This will cause an absolute mess at the closing table if that happens- if it doesn't ruin the sale altogether.

A few things that are VERY IMPORTANT to know:

• Check your contractor out thoroughly before hiring him/her. If your contractor has a history of non-payment, I would be wary. You can always ask if he has ever been involved in any type of Lawsuit. It's a basic question and the only people that would be offended by that are people that have. So do yourself a big favor, and ask. There are ways to find this out as well without asking, and you can always contact me to look up records if you wish- it only takes a few minutes, and is well worth the effort. 
• Also important to know: If your contractor does not pay the supplier for goods used in the work at your home, and the supplier is aware of your address for those materials, the supplier can even file against you. If there are sub-contractors involved, they can also file against you, if the contractor has not paid them.
• Make sure you have a contract for work to be performed with a stated cost, and get a receipt for your payment. 
• The contractor filing the lien has up to one year to file a foreclosure notice on your property to get paid. Contact an attorney and handle this NOW.
• If a Mechanics Lien is filed against your property, contact an attorney NOW. Even if you are not selling your property at this very minute, contact an attorney now.

If you have any legal questions about Mechanics Liens, contact your attorney. This article is not intended to give legal advice.

Should a home seller even respond a verbal offer?

In our part of southwestern Connecticut, verbal offers are not considered bona-fide  offers, but that isn't necessarily true  in all parts of the state, or the country for that matter. Generally speaking, if a buyers agent presents a verbal offer to your agent for your home, and the buyer couldn't even take 15 minutes to write up an offer, I wouldn't hold too much stock in that offer. BUT THERE ARE EXCEPTIONS....

I do want to stress that if your agent receives an offer on your home, whether it's verbal or written, it must be presented to you. As for buyers reading this article, you should know that all offers are to be presented to the seller  up until the time of closing, and the fact that you have a fully executed contract on a property does not diminish the listing agent's responsibility to present those offers, unless the seller has specifically requested in writing that they do not wish to see any other bids.

When to respond to a verbal offer: If and when your agent calls you with a verbal offer on your home, it is always your decision as to whether you will respond. Sometimes, the buyer's offer has an odd contingency and the buyers agent might feel that if you won't even consider that offer, that it is not worth anyone's  time to put anything formal in writing.  It could be that the buyer is out of town and want to move forward and that buyer just can't get together with his/her agent to put an offer in writing. Let your agent be your guide- I can assure you that most listing agents will request that the offer be in writing before presenting anything to you- bu there are extenuating circumstances.


When NOT to respond to a verbal offer: Again, let your agent be your guide. I would tell you to consider  not responding to a  verbal lowball offer . That buyer has nothing to lose, not even 15 minutes worth of his time to write up an offer. If they are truly interested, the psychological benefits of making a bona-fide offer, along with a deposit check can only help to make that buyer come up to a a reasonable price. If the buyer has not even seen your home, and is purchasing your home for speculation purposes, let him put something in writing.

In some areas, verbal offers are not so frowned upon- ask your agent at the time you authorize your listing contract how verbal offers will be handled.

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You are the seller, YOU are the boss! Your Realtor should listen to you!

I recently spoke with a homeowner who had experienced some difficulty in getting his agent to listen to his concerns, and having that agent do something about it. I truly feel badly for that homeseller, who in his case, was a very well educated man, had great business acumen, and had some very appropiate ideas that his agent did not seem to want to listen to, or implement.

Now honestly, that's not always the case. Some homeowners have some ideas that quite frankly, would not be in their own best interests, and it's up to the agent to explain to them that while they appreciate their ideas in order to effect a sale, that those suggestions would not be of benefit, and in some cases those ideas, if implemented could or would be detrimental to a sale.

What are some appropriate suggestions to give your agent?

Take new photos. After a certain period of time, or a season change, the main picture  for the house can look dated. This is not something that you hsould have to tell your agent, but if you need to, DO IT!

Look at your listing as it appears in the MLS and suggest changes if needed- I am convinced that most homesellers have never seen their listing, because if they had, they would change it immediately. An agent not inputting all of the information fields is sheer laziness on their part. (I'm sorry- I'm passionate about it) I would think that a few minutes to put room measurements in  the listing is no big deal. I always do it. That's only one example- schools are important too, especially if it's a sought after educational system.

Some buyers need certain rooms to be of a certain size, and if it's not  readily listed on th MLS data sheet, or available in any way, are not  inclined to see a house and waste their time for something that could only be a maybe. Sure, maybe a room size that is presented is going to turn off a buyer, but that would only be a showing that went nowhere anyway. My standard operating procedure is  that the seller signs off on the MLS sheet, and OK's it, as well as the brochure.

Open houses- well, that's a mixed bag. A few open houses in the right location can be a good thing. Be careful about overexposure to buyers who look every week to see what new listings there are. Agents have homeowners thinking that open houses sell a house. Agents get leads from open houses, and it is a well known statistic that less than 3% of all homes sell at public open houses. You don't want a buyer thinking, "Oh, that house is STILL available!"

If you have had any offers in the recent past, go back to those buyers and see why they didn't follow through on the transaction, if you don't already know the answer and have done everything you could to effect a sale. Could it have been that their highest number was not what you countered at? If you knew what their highest number was, would you have accepted it, or would you accept it now? 

Is it because the floors need refinishing in one spot, or a carpet needs replacing and they couldn't be bothered? What if you addressed their objection after contingencies were all met, and prior to closing? Could that make a difference? You bet, so why not give it a shot? The worst that can happen is that the buyer says no. So go back to that buyer and find out! The answer could be quite simple, and you can have a sale because your agent was pro-active.  **Think outside the box**

A few years ago, brokers didn't have to try so hard to put a deal together. They came pretty easily.  That's not true nowadays. If you have a buyer, do what you can to hold on to them, and put a deal together- if your agent is not willing to go the extra mile for you, you shouldn't feel stuck. If you are unhappy, you can always request a change. Most agencies will abide by a clients request.

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Should you fix up your home to get it sold, or sell it as-is?

Now that it comes time to sell your home, you realize that there are some things that you should have done over the years, but chose to do others for one reason or another.  You may have focused on the interior, and now your home is missing curb appeal, or you may have focused on the exterior, and the inside needs updating. So what do you do?

The answer will depend greatly upon a number of variables including your available funds, estimated time frame of completion of any work to be performed and whether or not that work can be completed while the home is on the market, the likelyhood of the return on your investment, the current real estate market climate and the number of competing homes in your price range. Your agent should be able to guide you as to what would make the most sense in your situation.

If fixing up your home seems to be the best choice: Make a list of everything that needs attention, whether it is defective, broken or worn out. Don't be afraid to ask your agent for assistance on this. It is important that buyers do not spot problems or issues before you do. If a buyer sees a number of minor issues, they may think that there are more issues that have gone undetected, and pass on your house.

Here are a few improvements to make before selling your home:

Remove and replace dated light fixtures and make sure EVERY light in the home is working properly, and that there are no dim areas.
Remove excess furniture, clutter and personal effects. (see staging articles )
Paint walls that need it, and if any room color is dark, paint it a neutral color.
Make sure that your heating and cooling systems are operating properly.
Note any plumbing issues and repair (including leaky faucets)
Replace worn or outdated carpeting. (If there is hardwood underneath your carpet  in good condition, just remove the carpet)
Replace broken windows, rotted wood, and make sure all doors and locks are working properly.

Weigh the cost of individual proposed improvements against the home's estimated market value after the repairs or upgrades are completed. See my prior post on Return on Investment for Home Repairs.  Improvements should not be warranted if the cost of that improvement outweighs the return. Before you decide to change the carpet, or re-roof your home, look at this prior post regarding return on investment percentages. You may also want to view a few homes that your  home will be competing with- if most of these homes have amenities or upgrades that yours does not, take that into consideration as well. If the kitchens are upgraded, you may want to consider an improvement, just don't overdo it. If you will be replacing appliances, there is no need to go top-of-the-line. Mid-range is fine. Remember, those appliances would be brand new, and that's a bonus within itself.

Selling your home in as-is condition: If you are considering  selling  as-is route, just make sure you have carefully thought out the following: Is it that cumbersome, or costly to do any repairs whatsoever?
Have you priced it correctly for the repairs, improvement that it needs?

Fixer-uppers have some appeal to  a general market, it just depends on the scope of repairs, or improvements that are needed. Minor cosmetics won't scare a number of buyers away who are willing to do some work by themselves, however when the minor repairs or cosmetics get to be too much to handle, they, too will pass. Limiting your market if you don't absolutely have to is not the best idea.  Remember, if an upgrade or repair costs $3,000 for example, you can expect the buyer to want to reduce the price by about $4,500 , just for the inconvenience of doing the work themselves. It's not a rule of thumb, it just seems to be a pattern that I have seen. When you price your home, and your agent creates marketing materials for the home,  you may want to note that you have reduced the price accordingly to offset the work needed, and hopefully that will head off any lowball offers.

Truly, you need expert guidance in any circumstance, and the advice that I would give you  is going to be different than the advice that I may give your neighbor. You have twoo different houses, and two different sets of circumstances regarding yoru proposed sale. When you are ready to make a move, and need a professional, call me. I'll be right to the point, and guide you in the best direction possible.

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Antique or Historic Homes in Connecticut- Do you know what to look for?

If you are thinking about buying an antique home, there are a number of unique factors that should go into your decision. Remember, that one day you will be a seller of that antique home.

Connecticut  has many "antique" homes, which are also commonly called "historic homes", however the two terms are not truly interchangeable. An antique is classified as a home that is greater than one hundred years of age.  An historic home does not necessarily have to be 100 years or older. It could be that a special event took place at the home,  that it housed a famous resident at one time, or was built by a renowned architect. An example would be "FallingWater" which was designed and built by Frank Lloyd Wright. While not an antique, this home was built between 1936 and 1939 and certainly has much historical significance.

If you are interested in purchasing an historic home, there are certain things that make your purchase more unique than others, and having an experienced team of professionals on your side is crucial to making a good decision.

First, and very important! Is the home on the local, Statewide, or National Register of Historic Places? Depending on what your intentions are  for the home, it could be a good thing, or a bad thing. A home on any of these "Registers", will have a continued appeal to a certain number of buyers, however  you must make sure and do your due diligence- If the home is listed in any of these places, there will aso be certain guidelines as to what you can change  or remodel in the house. There may even be a color restriction on the exterior, for historic preservation purposes.

Historical integrity, even if not listed in any registers, can be a concern for many buyers who are interested in this type of property. For example, your upgrades should  pay special attention to period details, and for example, a whirlpool in the bath or steam shower with glass enclosure doors would be inappropriate because these features are not indicative of the time that the home was built,  Sure, it's your home, and you can do what you want to with it, just remember that you have a limited buyer pool for resale, and you would limit it even further.

Major components of the home including heating, plumbing, electrical and air conditioning- When the  home was built, there were no building codes, so you may need to upgrade  or revamp the electrical, which may have already  been done once, but in need of updating again. Take special care to  look at the number of electrical outlets in the home, and if there are not enough outlets, woud it be reasonable and feasible to add more.(Speak with a licensed electrican on this) There could be galvanized plumbing and cast iron pipes, and it may be time to consider replacement (Speak with a licensed plumber)

Some  fun things to look for when purchasing an antique home:

Chestnut wood- American Chestnut, although once plentiful and used primarily  in the upper end antique homes. A severe blight nearly made this species extinct, and even now, the Chestnut that you see is usually imported from Europe. (Yes, you'll pay dearly for it)

The Front Door- Depending on the age and location of the home, if you are lucky  enough to find a home with its original front door, look for the amount of nails. The amount of nails in the door was to denote the wealth and rank of the occupant. .. and while we are on the subject of nails, rose-head nails  in the home is of value to its historical  integrity as well.

One last thing to add of a general nature is knowing the homes specific history. I really appreciate antique homes, (as if you couldn't tell)  Whenever I list a historic home, I contact the Historical Society and get  as much history on that home as I can for the incoming buyers as well as the outgoing sellers, if they do not have a complete history on the property. Finding out who built the home, who lived there, what they did,  and when certain improvements were made is all part of the charm of an antique  and historic home.

So if you are thinking of buying  or selling an antique home, you will need your experienced professional team to assist you, and you can start with me as your real estate agent :)