LISTING PRESENTATION PACKAGE CHAPTER 5

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LISTING PRESENTATION PACKAGECHAPTER 5
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COMPETITIVE MARKET ANALYSIS CMA The competitive
market analysis (CMA) is really a comparison
analysis used by real estate agents to aid in
determining a proper list price for a property.
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The CMA provides information on similar
properties that have been placed in the
marketplace so that they can be compared with the
property that is to be evaluated to determine an
offering price. These comparables are often
referred to as comps. CMA is NOT a formal
appraisal.
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CMA form (CMA-11) uses three categories of
comparables 1. Properties for sale now are
usually a little overpriced. 2. Reported sale
prior to (6) months gives a good estimated value
of the property. 3. Expired listings prior to (6)
months are usually overpriced properties. This
is usually why they do not sell.
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The onmarketnow list merely indicates to an
owner the prices that competitors (other owners)
are asking for their products (homes).
The reportedsoldpastsixmonths list is more
valuable than the list of current properties on
the market because it shows actual sale prices.
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Adjustments to comparable properties should be
made based upon the property that is the subject
of the CMA. The adjusted price is known as the
adjusted selling price.
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1 450,000 2 425,000 Everything is the same
but what you see in the pictures. 3 475,000
Between 450,000 and 475,000
How Much?
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For example, you can obtain comps from the Boards
of Realtors. If you are in the Orange County
area, use XMLS.WEB.SOCAL.COM
It is possible to download information from a
multiple listing service in a matter of minutes.
The following is a list of the Multiple Listing
Services. To use these databases you will need
the login or public I.D. and password or private
I.D.
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An agent could be liable for damages if a CMA
negligently omitted recent similar sales and used
comparables that resulted in the owner selling a
property for less than the fair market value.
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BOARDS IN THE AREA Pacific West
Realtors www.xmlsweb.socamls.com MRMLS www.
immrls.com Victor Valley www. vvar.com Glendale
MLS glendale.rapmls .com
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Greater South Bay www.realtylife. com Greater
Area www. desertareamls.com CLAW www.Brower.them
ls.com Desert Communities dcaormls.risco .net San
Fernando Valley sca.jlsalliance.com
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LISTINGS FORMS To complete a real estate
transaction and use the proper real estate form,
the agent needs to know what forms to use and
obtain those forms. All real estate forms may be
obtained from the internet, using a program
called Winforms. You will need to be a member
of the Board of Realtors to use Winforms.
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Winforms is the program for forms for the
California Association or Realtors (CAR). This
program provides unlimited impressions of the
agreements, contracts, disclosure and other forms
used in any real estate transaction.
You may fill out the form on the internet and
have the form printed out, ready for the client
to sign.
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ESTIMATED SELLERS PROCEEDS The seller will pay
certain closing costs when the seller sells the
property.
The buyer will pay certain closing costs when the
buyer buys the property
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SALES PRICE By using the CMA the listing agent
can determine the approximate selling price of
the property.
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ENCUMBRANCES An encumbrance is any thing that can
affect the ownership of the property. Liens
(Money encumbrances) Non-money encumbrances We
will deal mostly with liens in estimating the
cash proceeds.
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The next step is to determine the estimated
closing costs.
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SELLING COSTS Title Insurance County Documentary
Tax Fees(0.55 per 500) Estimated Escrow Fees
(200 Setup 2.00 /1,000) Termite Inspection
Report Fees Prepayment Penalty (if
any) Appraisal Fee
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Reconveyance Fee (If existing loan is being paid
off) Lenders Demand or Beneficiary Statement
Lenders Document Fee Proration of Interest on
Existing Loan Miscellaneous Fees Home Inspection
Fee Buyers Cost Paid by the Seller Home Warranty
Policy Real Estate Commission ______
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The sales commission cannot be a fixed
percentage. It must be negotiated.
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CREDITS Prorated taxes. Prorated
insurance. Impound accounts.
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NOTES CARRIED When the seller carries back a note
this will decease the amount of cash he will
receive.
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CALCULATING THE SELLERS PROCEEDS Usually the
calculation of the sellers proceeds is computed
with the aid of a computer.
Here we are trying to explain to you what the
computer does without providing all the charts
and necessary facts needed to make the
calculations correctly.
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• SELLERS PROCEEDS
• 1. Sales Price
• Loans
• 3. Commission
• 4. Closing Costs
• 5. Net Equity 1 2 3 4
• 6. Credits
• 7. Proceeds 5 6
• 8. Less Notes Carried
• 9. Cash Proceeds 7 8

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Example Mr. Smith sold his home for 300,000.
The commission is 18,000 and closing costs were
6,000. He had a 1st trust deed of 124,000. He
received no credits nor carried back any loans in
this transaction. What are his net proceeds?
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• SELLERS PROCEEDS
• 1. Sales Price 300,000
• Loans 124,000
• 3. Commission 18,000
• 4. Closing Costs 6,000
• 5. Net Equity 1 2 3 4 152,000
• 6. Credits 0
• 7. Proceeds 5 6 152,000
• 8. Less Notes Carried 0
• 9. Cash Proceeds 7 8 152,000

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PURCHASE PRICE When purchasing a home, the buyer
will have to pay certain closing costs to obtain
the home before the close of escrow.
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ESTIMATED BUYERS COSTS When writing an offer to
purchase a home, you should supply the buyer with
the approximate costs to purchase the home.
In the age of computers, this form is usually
produced on the computer. In this class we will
do it by hand.
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POINTS A Origination Point is 1 of the Loan
Amount, paid in cash. Usually used on purchase
money loans (new financing).
A Discount Point is 1 of the Loan Amount, and is
then subtracted from the loan amount. Note no
money out of pocket. Usually used on hard money
loans (refinancing).
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Tax service Miscellaneous Escrow fees(200
Setup 2.00 /1,000) Draw 2nd Trust
Deed Miscellaneous Notary Fees Recording Fees,
etc.
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PROPERTY TAX IMPOUND ACCOUNT CHART January 7 July
7 February 2 August 8 March 3 September
9 April 4 October 4 May 5 November 5 June
6 December 6
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Example Mr. Anderson closed escrow on the
purchase of a home and closed escrow on April 15
this year. The purchase price is 200,000.
Approximate his share of the property tax for
impounds. Look up the perorations on the Property
Tax Impound Account Chart April 4 200,000 X
0.0125 12 x 4 833
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BUYERS COSTS 1. Purchase Price 2. Down
Payment 3. Loans 1 2 4. Discount Points
___ 5. Net Funds 3 4 6. Orig. Points ___
x 3 7. Buying Costs 8. Cash Needed 2 6
7
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Mrs. Brown purchased a home for 250,000 and
obtained a 200,000 loan. She agreed to pay 2
points for the loan. Buying costs are 4,000.
200,000 x 0.02 4,000
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BUYERS COSTS 1. Purchase Price 250,000 2. Down
Payment 50,000 3. Loans 1 2 200,000 4. Disco
unt Points __0 0 5. Funds 3
4 200,000 6. Orig. Points __2 x
3 4,000 7. Buying Costs 4,000 8. Cash Needed
2 6 7 58,000
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THIS HOME IS WORTH 400,000
Problem time.
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Problem 1 Mr. Rooks closed escrow on the purchase
of a home and closed escrow on July 10, this
year. The purchase price is 250,000. Approximate
his share of the property tax for impounds.
July 7 250,000 X 0.0125 12 x 7 1,823
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Problem 2 Mr. Parker closed escrow on the
purchase of a home and closed escrow on September
2, this year. The purchase price is 300,000.
Approximate his share of the property tax for
impounds.
September 9 300,000 X 0.0125 12 x 9 2,813
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Problem 3. Mr. Mrs. Anderson sold a home for
250,000. The closing costs were 5,000 and
selling commission was 15,000. He had a first
trust deed of 150,000. They received a credit of
5,000 on property taxes and carried back a
30,000 second trust deed. What are their net
proceeds?
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• SELLERS PROCEEDS
• 1. Sales Price 250,000
• Loans 150,000
• 3. Commission 15,000
• 4. Closing Costs 5,000
• 5. Net Equity 1 2 3 4 80,000
• 6. Credits 5,000
• 7. Proceeds 5 6 85,000
• 8. Less Notes Carried 30,000
• 9. Cash Proceeds 7 8 50,000

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Problem 4. Mr. Mrs. Ford sold a home for
200,000. The closing costs and commissions were
16,000. He had a first trust deed of 159,000.
They carried back a 35,000 second trust deed.
What are their net proceeds?
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• SELLERS PROCEEDS
• 1. Sales Price 200,000
• Loans 194,000
• 3. Commission 16,000
• 4. Closing Costs 16,000
• 4. Net Equity 1 2 3 10,000
• 5. Credits 0
• 6. Proceeds 4 5 10,000
• 7. Less Notes Carried 0
• 8. Cash Proceeds 6 7 10,000

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Problem 5 Mr. Green purchased a home for
250,000. The closing costs were 5,000. He paid
50,000 for the down payment. The loan cost is 1
point for the loan. How much does he need to
close the loan?
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BUYERS COSTS 1. Purchase Price 250,000 2. Down
Payment 50,000 3. Loans 1 2 200,000 4. Disco
unt Points ___ 0 5. Funds 3 4 6. Orig.
Points __1 x 3 2,000 7. Buying
Costs 5,000 8. Cash Needed 2 6 7 57,000
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Problem 6 Mr. Garcia purchased a home for
350,000. The closing cost were 7,000. He paid
70,000 for the down payment. The loan cost was
1½ points for the loan. How much does he need to
close the loan?
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BUYERS COSTS 1. Purchase Price 350,000 2. Down
Payment 70.000 3. Loans 1 2 280,000 4. Disco
unt Points ___ 0 5. Funds 3
4 280,000 6. Orig. Points 1.5 x
3 4,200 7. Buying Costs 7,000 8. Cash Needed
2 6 7 81,200