Expert: Jim Root - 7/3/2009

Question
Here is our situation in a nutshell:

My husband is in the Air Force and we bought a house in 2005 in Illinois.  We
have been relocated to Florida for several months, and our house in Illinois
has been on the market for a year now.  The price has been dropped from
156K to 150K for about 5 months now, and still no bites.  I think it is being
shown good enough, but all the comments seem to be the same, saying
"house looks and shows really nice but just too small".  

My husband got information about a month ago about the government
assistance program, and to make this short....we have both called and spoke
with representatives of this program saying we qualify for it, and we will get
reimbursed for our loss if we show at least 10% loss.  To do this, we would
have to list our house at 135K (is pretty much the magic number)  

Our real estate agent is from ReMax and is now on the defensive when we
mentioned this to her, and told her we are thinking about lowering the price.  
She has several other listings in our very same neighborhood, and she lives
just down the street.  She said her husband (who helps her alot) is not happy
about this, and she has stressed to us more than once that if we bring the
price down that much, it will affect the other houses in the neighborhood
market, including their home (which isn't for sale but saying it will lower the
value?)  She has been doing this for a very long time and I have always felt
confident with her..until now.  She said yesterday she called and spoke with
someone with this government program and they told her we would not
qualify, and she will not let us do this.  So we are confused, and wondering if
she is just looking out for her best interest instead of ours?   We have been
living in an apartment and paying this mortgage for a year now, and it's
getting very stressful for us with the money we are already throwing at this
house.  Bottom line question is:  If we WANT to lower the price on our house,
don't we have that right?  It is our home, not hers and if we feel we should be
able to do what we want as far as asking price without the guilt trip about it.  
The way she is acting lately, she seems like she is going to put up a fight
about this.  We are contracted with her until October 2009.

Answer
Hi SARA--

First let me address the "government program" you refer to. I assume that it's the Homeowner's Assistance Program (HAP) that's the program sponsored by the Department of Defense (DOD) and administered by the US Army Corps of Engineers. The program was originally established to aid those Homeowners adversely affected by the Base Realignment & Closure Act (BRAC) but has been re-designed to help other Military personnel forced to move during the current Real Estate Market crisis!

As with any Government Program--especially one administered by the Army, HAP's guidelines are complex, sometimes seem contradictory and
ma be subject to several opposing interpretations by those to whom you pose questions. I urge you to go to the DOD/HAP Website and read everything carefully--then make an Application, getting an Approval al (or Denial) in writing BEFORE doing anything drastic!

GO TO:
                http://hap.usace.army.mil/

AND CHECK IT OUT!

As a 20-year USAF M/SGT and a 30 year Real Estate Professional, I can see from both your perspective and that of your Realtor--and I
suspect that she and her Husband are not as worried about your one "Lowball Sale" disrupting values in your neighborhood as she'd like you to think.If she & he can't see that your one 4-Sale Home is "just a drop in the bucket," one of many that are declining in value and lowering prices to get sold, than they're either blind or not-so-very-smart! I'll bet her other Listings nearby yours aren't selling quickly and/or for "Full Price," either!

Not blind, not stupid--I suspect it's LAZINESS & GREED that has her fighting you on the lowering of your price! Working with a Seller using the HAP Program requires more work for the Agent(s),is likely to be fraught with "obstacles" for the Realtor(s) to overcome,"problems" to solve, and is all-in-all a lot of "blood, sweat & tears" for all the Real Estate Professionals involved in the transaction !

And the lower price, means a lesser Commission for the Agent! Of course I can't be sure, but I think she's NOT looking out for your
best interests as much as she's trying to keep her work to a minimum and her paycheck to a maximum!

She "will not let " you lower the price? I was wrong;. she's not lazy & greedy--she's crazy... thinks she owns your House! You own the Home, she's just got the Listing and it expires in about 3 months!I suggest you tell her that the Listing means she's working for you, not the other way around. And you have every right to set the price you'll accept for the sale! Tell her to lower the price, if that's what you and your Husband want to do! if she refuses, ask her to release your Listing. If that doesn't work, meet with her Company's Broker or Manager. Still no relief, a phone call to the Chairperson of the Ethics Committee at the local Association of Realtors and the Illinois Department of Licensing (Real Estate License Division) SHOULD take care of things!

Thank you and your Husband BOTH for your service to our Country. GOOD LUCK!

--JIM