While working as a Massachusetts Realtor over the last twenty five years one of the questions that always seems to come up is whether or not a Realtor is obligated to disclose a murder, suicide, haunting or other type of paranormal activity that may have occurred in a home or other Real Estate.

Wikepedia defines a haunted house as a home or other Real Estate often perceived as being inhabited by disembodied spirits of the deceased who may have been former residents or were familiar with the property. Supernatural activity inside homes is said to be mainly associated with violent or tragic events in the building’s past such as murder, accidental death, or suicide.

Disclosing Murder, Suicide, and Haunted Homes in Massachusetts

This is one of those topics that I would be willing to bet at least half the Realtors polled would get the answer wrong. I am sure most Real Estate agents would say that they are required to disclose a haunted house or if someone died in a property by murder or suicide. They would be dead wrong:)

One of my beliefs is that every buyer should be entitled to know anything that could materially effect the value of a home or the ability to sell in the future. This in fact is one of the articles in the Real Estate code of ethics.

In Massachusetts anyways, a Realtor is not required to disclose these kinds of events in a property. Apparently lawmakers do not feel these kind of events are worthy of Real Estate disclosure. I suppose in the case of a haunted home it would be much harder to prove the actual existence of ghosts.

Many states require full disclosure of violent crimes such as murder and any other event that may stigmatize a property before it is sold. Not the case in Massachusetts!

Below is the excerpt from the Massachusetts General Laws Chapter 93, section 114 that discusses Real Estate disclosure for alleged haunted homes, murder and suicide:

The fact or suspicion that real property may be or is psychologically impacted shall not be deemed to be a material fact required to be disclosed in a real estate transaction. “Psychologically impacted” shall mean an impact being the result of facts or suspicions including, but not limited to, the following:

• (a) that an occupant of real property is now or has been suspected to be infected with the Human Immunodeficiency Virus or with Acquired Immune Deficiency Syndrome or any other disease which reasonable medical evidence suggests to be highly unlikely to be transmitted through the occupying of a dwelling;

• (b) that the real property was the site of a felony, suicide or homicide; and

• (c) that the real property has been the site of an alleged para psychological or supernatural phenomenon.

No cause of action shall arise or be maintained against a seller or lessor of real property or a real estate broker or salesman, by statute or at common law, for failure to disclose to a buyer or tenant that the real property is or was psychologically impacted.

While this is the case in Massachusetts you can not assume that in other states it is alright not to disclose known events such as a murder or haunting.

I find it kind of interesting that disclosure of a person who had AIDS was lumped into this kind of stigmatization. It does not seem all that similar of a disclosure issue?

If you are a Massachusetts Realtor another thing to pay careful attention to is purposely deceiving someone. While non disclosure may not be an issue, blatantly lying to someone certainly could be. If you are marketing a home that is well know to be suspected of being haunted and a buyer ask you a direct question about it you should always be truthful of what you know.

Other Real Estate articles worth a look:

Massachusetts seller’s disclosure statement

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About the author: The above Real Estate information on disclosing murder, suicide and haunted Massachusetts homes was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 25+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Medway, Franklin, Framingham, Grafton, Hopedale, Mendon, Upton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, Natick, Worcester and Douglas.

Taxes on homes or other property in Massachusetts are typically based on two pieces of information including the towns property tax rate and the assessed value.

Obviously the tax rate is set in stone and is not something that is going to be changed once it is put in place for that particular fiscal year. What does change of course is the assessed value of the home.

If you are a Massachusetts home owner, appealing a Massachusetts property tax bill if something you may want to consider if you feel the assessed value is way off base on your home.

How is assessed value calculated

In order to appeal the property tax bill you are going to need to have a good understanding of how the assessed value of your property was calculated by your local tax assessor.

A Real Estate assessed value is typically calculated on a year to year basis in most communities although it is possible it could be every few years for some. What you need to clearly understand is that the assessed value of a property is NOT the same as:

• An appraised value by a lender
• A market evaluation by a Realtor which is often called a BPO or broker price opinion
• The actual market value

It is easy to understand why the general public can get confused on the assessed value vs fair market value issue because even many Real Estate agents don’t know the difference! How do I know this? From some of the crazy statements I hear from hanging around the office water cooler or even some of the silly advertising that you find in the Multiple listing service or other advertisements.

As an example “come take a look at this bargain priced home listed for $100,000 less than assessed value”. I bet you are getting excited already and want to see this place – NOT!

What this tells me is that the agent marketing the property knows very little about property valuation or they think someone else might be stupid enough to believe the property is being given away by the owner. A good buyer’s agent that didn’t just get their license and has a bit of intelligence would be able to point out to a naive buyer that the home has been over assessed by the town and the owner is paying too much in taxes!

Keep in mind that assessed values are nothing more than a yard stick for a municipality to collect an appropriate amount of taxes to sufficiently cover the state and local appropriations chargeable to the city and town.

Towns adjust the tax rate and a properties assessed value to achieve this goal. For a complete explanation see Assessed value v.s fair market value.

So how do you go about checking on whether the assessed value of your home makes sense? The 1st thing you are going to want to do is look over what is called the town assessment field card and check it over for accuracy. The town field card will have pertinent information about your property including the bedroom and bath count, the gross living area, the age,  garage type and size, as well as the amount of land you own. All of these things play a large roll in where your assessment will be figured.

You will want to look over the field card diligently to make sure everything is correct. If there are blatant errors that pop out you may have an easy challenge on your hands.

One would imagine that if you believe you are being over assessed it could be because your neighbor of someone else with similar characteristics to your property is being assessed at a lower amount. This is clearly a possibility and actually happens fairly often.

What you are going to need to do is have someone provide you with what they feel are the most comparable properties to yours that have sold in the town. A skilled local Realtor is usually a good option to help you with this. Armed with this information you can then check the assessed values on those properties. There should be some kind of correlation with these properties. Don’t discount the fact that your home may be in a more attractive neighborhood. If the assessed value of the similar homes are lower you may have a case.

Meet with the local tax assessor

In Massachusetts the law governing septic system installation and maintenance is known as Title V. Whenever a home owner is going to be selling their home they will need to get what is called a Title V inspection done.

In order to close on a property in Massachusetts you will need to have a passing title V.

If a Title V test reveals that the septic system has failed a seller has two options in order to get to the closing table. They can either replace the system prior to closing or they can put an appropriate amount of money in escrow guaranteeing the system will be fixed. A third option could be to get the buyer to pay for the septic system although this is less likely to occur unless the buyer is desperate for the property.

Most lenders will accept funds to be held in escrow, however they are going to generally ask for 1.5 times the cost of the estimated amount to install a new system. For example if a septic installer gives a quote of $20,ooo for the installation of a new system, the lender is going to ask for $30,000 to be held in escrow.

One of the things a Title V inspection will reveal is what is known as the septic systems “capacity”.  A septic system is “rated” according to it’s bedroom count. For example if a septic system has the capacity for four bedrooms it will say as much in the report.

One of the subjects I have written about in the past is bedroom count misrepresentation with septic systems. The are many Realtors that don’t even know this law exists and have put homes on the market stating there are more bedrooms than the septic system capacity allows for.

In other words if the septic system is only rated for three bedrooms you can not market your home as a four bedroom regardless if you have a room that qualifies as one. This is an easy way to get sued. Don’t make this mistake as it could be a costly one!

By the way, the qualifications of a bedroom must be a room providing privacy primarily used for sleeping purposes, have at least one electrical outlet, ventilation, at least one window, and have minimum dimensional criteria. There are also some towns where you need to have a closet as well although some also will accept space to house clothing such as a bureau.

One of the things that I made mention of in the article about septic system misrepresentation is how a home owner could potentially add an addition to their home that could be construed as a bedroom. It could meet all the criteria of a bedroom but not necessarily be used as such.

Using a bedroom count deed restriction

One of the things I have seen become more common place over the last couple of years is towns forcing home owners to put deed restrictions on their properties. This can happen because of the bedroom issue as well as another little know Title V rule.

When calculating bedroom count one of the rules of calculation is to take the number of rooms in the home and divide that by two.

For example, a proposed “game room” addition to a nine room, 4-bedroom house will create the tenth room of a house. Per Title 5, the number of bedrooms is calculated as: 10 rooms divide by 2 equals 5-bedrooms.

A deed restriction can be used so that a building permit may be issued for homes that exceed the approved septic design flow based on the total room count. The intention of the deed restriction is to resolve the possible conflicting Title 5 definition of a bedroom to the actual bedroom count.

This deed restriction is not intended for construction that will actually increase the bedroom count beyond the approved design. If  sometime in the future the septic system is upgraded to meet additional bedroom flow capacity, or the house becomes connected to public sewer, the owner may request the Board of Health for a release of the deed restriction. This release  also gets recorded at the Registry of Deeds.

A deed restriction is also not something that has to be done although the alternative to a deed restriction would be to seek approval from the Board of Health to upgrade the septic system in order to meet the proposed design capacity.

What I have found interesting about these Title V bedroom count deed restrictions is that some towns are fairly rigid with them and others are not. I know in my home town of Hopkinton MA the board of health regularly puts deed restrictions on properties using the room count divided by two formula.

Related Real Estate home selling articles:

• Massachusetts Title V septic systems
• Proper Massachusetts home pricing
• Costs to sell a Massachusetts home
• Massachusetts home buyer turn offs

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About the author: The above Real Estate information on Massachusetts Title 5 bedroom count deed restriction was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Upton, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

When a Real Estate client expresses a desire to break a Real Estate contract you know the next few days of your life are probably not going to be too pleasant. When people are looking to break a contract it is usually a highly charged emotional event!

In Massachusetts we are a two contract state. When a buyer wishes to purchase a property, more often than not they will fill out what is known as an offer to purchase contract.  This is later followed up with a purchase and sale agreement which has the same terms and conditions as the offer form but spelled out in much greater detail.

The offer to purchase contract includes all the major terms in the deal including the offer amount, consideration which is the amount the buyer is putting in escrow to secure the property, as well as the agreed upon closing date, and any contingencies. The most common contingencies include the buyers ability to obtain financing and the home inspections that they would like to perform. These include home, pest, radon, well, mold, lead paint and possibly others.

The typical amount you almost always see for initial consideration on a Massachusetts offer form is $500-$1000. When the buyer signs the purchase and sale agreement the buyer will typically put a balance of 5% in escrow. Although this is the amount you see most often, a deposit is always open for negotiations. Sometimes a buyer might not quite have the 5% to put down.

Breaking a Real Estate contract as a buyer

Most of the time the person that wants to get out of a Real Estate contract is the buyer. There could be any number of reasons why a buyer would wish to terminate a contract from general home inspection issues, to the discovery of mold or radon, or some other unforeseen problem with a property.

If the buyer has a contingency within the contract for the reason they wish to terminate then there is no issue and the buyer will receive their deposit back in full.  There is always the possibility that a buyer could try to back out of a Real Estate contract after all their contingency dates have lapsed. In this case the seller would be entitled to keep the money that is in escrow. It is possible that the seller could sue the buyer for damages but in my experience most of the Real Estate contracts that I have seem limit the sellers damages to the deposit amount.

Breaking a Real Estate contract as a seller

What about the seller backing out of a contract? This is a question that I often have to educate my seller clients on. There are many folks who do not realize that an offer to purchase Real Estate in Massachusetts is a BINDING contract. This means that a buyer could sue you for performance and force you to sell your home.

Sometimes sellers can get remorse and feel like they no longer want to sell after they have signed a contract with a buyer. There could be any number of reasons for this happening. Maybe the house the seller wanted to purchase is no longer available or some kind of heath issue crops up with one of the parties that makes selling not an easy task. There could be an endless amount of reasons.

What do you do if you are selling your home, have a signed contract and feel that you want to break the contract? The 1st thing you would want to do is make your listing agent aware of the situation and have them get in touch with the buyers agent.

As a seller you are probably going to feel like you are on a stormy island of your own as all the other parties in the transaction are not going to be too happy with your decision.

You can more than likely expect the following:

• Be prepared to release the buyers escrow money to them with any accumulated interest.
• Most buyers will more than likely want to reimbursed for any out of pocket expenses they realized during the transaction. These expenses could include: inspections, mortgage application fees, mortgage lock in fees, attorney expenses, etc.
• Additional complications could include the expense of interim housing if they have already sold their home and were expecting to move into yours.
• A change in interest rates could be another complicating factor if rates have risen during the time they were under contract. Be prepared to buy down their mortgage rate if they ask.

As a seller what you need to remember in this circumstance is that you are breaking a contract. If you really want to remain in your home you need to be as nice as pie to a buyer. The buyer could easily drag you into court to force what is known as “specific performance” where you are not only forced to sell your home but also reimburse the buyer for any of their costs associated with this mess.

Obviously the best case scenario would be a very understanding buyer who lets you excuse yourself from the contract. Not every buyer is going to be so kind. If you find yourself in this kind of situation a competent Real Estate attorney would be a must! A Real Estate attorney would be able to negotiate the best possible settlement with the buyers or their lawyer.

Other Real Estate articles:

• Massachusetts Seller’s statement of property condition

• Handling Massachusetts Real Estate offers

• Staging Massachusetts homes

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About the author: The above Real Estate information on breaking a Massachusetts Real Estate contract was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Upton, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

As a Massachusetts Realtor that has been doing quite a few successful short sales, one of the things I like to make sure of when I meet a potential client that is looking to do a short sale is to give them a complete understanding of how they work.

Short sales can be complicated transactions. Anyone who regularly participates in short sales knows that almost every single transaction is different. Every lender has their own set of rules on how they go about completing a short sale.

One of the things in particular that I feel is extremely important to educate a seller doing a short sale is the tax consequences. There are different sets of rules regarding short sale tax liability depending on whether or not the home was a primary residence or not.

If you are selling your primary residence as a short sale, The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt. The debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a short sale or foreclosure, qualifies for the relief granted.

The Mortgage Debt Relief Act applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion or $1 million if married but filing separately. The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition. This act was put in place for the specific purpose of helping home owners avoid the financial hardship caused by doing a short sale.

Prior to this relief act being put in place the IRS would treat the forgiveness of a debt as taxable income. The logic behind this is when you take out a mortgage there as an assumed obligation that you will be paying it back. When money is borrowed, the borrower is not required to include the loan proceeds as income because the borrower has to pay back the loan. When the obligation to pay back the loan is removed, the amount of the proceeds the buyer received becomes reportable as income because there is no longer an obligation to repay.

When there is a cancellation of debt, the lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt. Eligible home owners also must complete IRS form 982 which must be included with the Federal tax return to claim the mortgage relief.

If you are selling a property and it is not your principle residence you will be paying taxes on the short sale deficiency that is forgiven!

This is obviously a key consideration when determining whether doing a short sale is the right move or not.  Debts forgiven that do not fall under the debt relief act include rental properties, business properties, 2nd homes and car loans. Credit cards also do not apply unless you were insolvent just prior to the cancellation of debt.

The most common situations when the cancellation of debt income is NOT taxable include:

• Qualified principal residence indebtedness: This is the exception created by The Mortgage Debt Relief Act of 2007 and applies to most homeowners.
• Bankruptcy: Debts discharged through bankruptcy are not considered taxable income.
• Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total liabilities exceed the fair market value of your total assets.
• Certain farm debts: If you incurred the debt for the purpose of running a farm, more than half your income from the prior three years was from farming, and the loan was owed to a person or agency regularly engaged in lending, your cancelled debt is generally not considered taxable income.
• Non-recourse loans: A non-recourse loan is a loan for which the lender’s only remedy in case of default is to repossess the property being financed or used as collateral. In other words the lender is not allowed to pursue you personally in case of a default. Forgiveness of a non-recourse loan resulting from a foreclosure does not result in cancellation of debt income. However, it may result in other tax consequences.

Whenever I am dealing with a short sale and there are tax questions, I always recommend speaking to a qualified tax professional or attorney who is well versed in these matters.

One of the other things I would pay careful attention to is getting your Massachusetts short sale debt discharged. There are a lot of Realtors who are doing short sales and do not have a clue about debt release. You do not want to get caught with your pants down on this! Having a collection agency chase you for unpaid debts is probably not a pleasant experience!

Related Real Estate articles:

• Do you make Mortgage payments during a short sale?
• Questions to ask a short sale listing agent
• Picking a Massachusetts short sale attorney and Realtor
• Massachusetts Short Sale specialists

If you are needing to complete a  short sale of your home or condo in Ashland, Bellingham, Blackstone, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northboro, Northbridge, Shrewsbury, Southboro, Sutton, Wayland, Westboro, Whitinsville, Worcester, Upton and Uxbridge MA. Get in touch! I would love to interview for the chance to represent your best interests.

I am successfully completing short sales through out the Metrowest Massachusetts area. So far, knock on wood, I have a 100% success rate for short sale approval!

If you are not in the Metrowest Massachusetts area and need to do a short sale please feel free to contact me and I would be happy to refer you to a Realtor in your location that handles short sales and knows what they are doing!

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About the author: The above Real Estate information on short sale tax consequences was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Ashland, Bellingham, Blackstone, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northboro, Northbridge, Shrewsbury, Southboro, Sutton, Wayland, Westboro, Whitinsville, Worcester, Upton and Uxbridge MA.

One of the things that Massachusetts home owners who are serviced by a private septic system need to be keenly aware of when selling their home is to make sure they do not misrepresent the bedroom count. When a home is serviced by a septic system in Massachusetts the advertised bedroom count must meet the actual septic system design capacity.

This is a critical piece of information for sellers to understand because there are quite a few Realtors that have no idea that this law even exists.

There have been quite a few cases where Massachusetts Realtors have put homes on the market where the advertised bedroom count did not match the septic systems capacity. For example, homes have been listed in the Multiple Listing Service (MLS) where the bedroom count was shown as four when in fact later on the buyer discovers the septic system was only rated for three bedrooms.

This of course creates a situation where both the seller and Realtor can be sued by the buyer. Not a pleasant situation and something that could easily be avoided just by knowing how a simple law like this works in Real Estate.

All septic systems are rated according their bedroom capacity. When someone says the septic system is “rated” for four bedrooms it means that the system will handle the waste generated by four bedrooms. I have seen many people become confused about this topic and think that bathroom counts have something to do with how septic systems get rated.

The bathroom count has nothing to do with it at all!  When you think about it this makes perfect sense. The amount of people living in a home  determines how much a septic system gets taxed, not how many bathrooms. Six people living in a home would obviously generate more waste than two people.

Where sellers and Realtors get into to trouble is when there are rooms in a home that are counted and marketed as bedrooms when in fact they are not. As an example, you could have a home that has three bedrooms on the 2nd floor and another room on the 1st floor that is called a “bedroom”.  This room has a door, a closet and a window large enough for a person to escape through…all requirements of a bedroom.

The problem, however, is that if this home has a septic system that is rated for only three bedrooms, it is not a four bedroom home and should not be marketed as such.

There are certainly differences in market value between three and four bedroom homes regardless of the overall size of the house. If a buyer relies on incorrect information when deciding what to pay for a home, it is easy to see why they would have a strong case in court.

Another common situation that can occur is when a seller adds an addition to their home. If the addition happens to be what you are calling a bedroom but there has been no corresponding “upgrade” to the septic system, you can not advertise it as such.

Whenever there is any doubt about the bedroom count, a Realtor should be verifying the records at the local town hall. Most board of health agencies should have this information on record either via a septic system design or “septic as built”.

The other way a septic systems capacity can be verified is when the Title V is performed. In Massachusetts whenever a home is transferred to someone other than an immediate family member a Title V test must be completed. The septic company that completes the Title V will issue a report which will include information on the design capacity of the system.

I know 1st hand based on things I see on a daily basis in the MLS, like lousy pictures and poor or no marketing write ups that sellers often times do not check up on what their Realtor is doing for them. In the court of law ignorance is not an excuse. If you are selling a Massachusetts home you should always ask your Real Estate agent for a print out of what has been published so you can check it for accuracy!

Want to know more about Title V septic systems and selling a Massachusetts home? View my in depth article about Massachusetts Title V and home selling by clicking the link.

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About the author: The above Real Estate information on Massachusetts bedroom counts with septic systems was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Upton, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

If you are selling your home in Massachusetts it is possible you may see a buyer try to purchase your home with a home sale contingency.

In other words they write into the Real Estate contract that they will not have to proceed with buying your home unless they successfully close on the property that they currently own. Accepting this arrangement 99% of the time is a big gamble and probably a very big mistake!

The thought of ever recommending  one of my seller clients accept an offer contingent upon the sale of another property is just down right fool hardy. Just to be clear, it absolutely makes no difference  what kind of Real Estate market we are in either. It could be a seller’s, buyer’s, or neutral Real Estate market but that does little to change the appeal of a home sale contingency. 

An offer contingent on another property closing means one thing – YOU LOSE CONTROL OF THE PROCESS!! With no guarantees of anything.

Don’t be lulled into considering this arrangement if a buyer woos you with a full price offer either because  if you never make it to the closing table what good does it do you?

As a home seller here are a few things to consider:

• How do you know if the contingent home is priced correctly?
• What if the property is not priced properly and the seller does not drop their price?
• What if the home has issues discovered at a home inspection  that can not be overcome?

Is the picture starting to become clearer on why a home sale contingency is not a good idea? When you agree to accept a home sale contingency your home is off the market and you are at the mercy of the contingent home selling.

As someones trusted Real Estate adviser there is only one circumstance where I could feel good about one of my seller clients accepting this type of arrangement.

If I was marketing an extremely difficult property to sell and the person making the contingent offer had a much more salable property then I would possibly guide my seller client into considering a contingent sale.

For example, lets say the home I was marketing had some form of Real Estate functional obsolescence that made it a difficult property to sell. Lets also assume the contingent home happens to be located in a highly desirable area of town and is in mint condition. The only obstacle left in this situation is making sure the contingent home was going to be priced right. If that criteria was met this would be something a seller may want to consider as long as they were getting a fair offer on their property.

Remember too that as a seller when you accept a contingent sale you are relying on a different Realtor that you may or may not know to see this transaction through to a successful conclusion. Working in this field on a daily basis I come across a wide variety of Real Estate agents. Some are very good and others you would not want to wish on your worst enemy! This could become a key consideration in your thought process.

If not a home sale contingency what about a “right of 1st refusal”? On a number of occasions over the years, after being rebuffed on a home sale contingency the buyers agent has tried going down the road of asking for a right of 1st refusal instead.

I find that many Realtors do not even truly understand what a right of 1st refusal is! When you allow a buyer that can’t purchase a home without selling their own (contingent sale) to have a right of 1st refusal you are doing your seller client a tremendous disservice.

When I am marketing a home and a legitimate buyer comes along that wants to purchase this property, the last thing I want is to cloud the negotiations by telling them we must wait 24-48 hours (the typical time allowed) to give another buyer their “1st right of refusal”. Why on earth would I want to be required to call another buyer who doesn’t qualify to purchase the house without selling their own home to ask them if they would like to exercise their “right of 1st refusal”?

This is pointless waste of time! I have found that some Realtors advise their clients that this arrangement is acceptable out of pure stupidity or because it gives them a small sense of accomplishment even though they have accomplished nothing.

Allowing a buyer who doesn’t qualify a right of 1st refusal could cause the seller to end up with nothing if a ready, willing, and able buyer walks away out of frustration.

Another scenario to consider is if the buyer exercises the “right of 1st refusal”? You could certainly add language that says this buyer would forfeit their deposit if they did not close as stipulated but is that worth losing the buyer that could have purchased the home without any of this mess? Is keeping their deposit enough to mitigate a lost buyer? My answer would be NO especially if  the Real Estate market was week and values were declining.

The only time it would make any sense to accept a right of 1st refusal is if the buyer did not have anything to sell and could step forward to purchase right away if the seller required them to do so. When you come right down to it how does a right of 1st refusal benefit a seller other than making them feel good a potential buyer is interested? The point is the buyer more than likely is not in a position to buy. When they are able to purchase they can always come back at that point anyway!

So if you don’t want to lose control of your home sale process stay away from contingent sales and right of 1st refusals.  If your home is not selling you can always reduce the price to attract more buyers and get the property sold in a timely fashion.

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About the author: The above Real Estate information on Massachusetts home sale contingencies and right of 1st refusal was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Mendon, Hopedale, Medway, Franklin, Framingham, Upton, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

One of my favorite things when selling a Massachusetts home is to receive multiple offers. I know there are a lot of Real Estate agents that hate this situation because on many occasions it can become contentious.

When there are multiple offers on a home from a couple of different parties there is only one winner. Like everything else in life you can encounter some sore losers.

As a sellers agent, I could care less because my job is to get my seller client the best terms and conditions possible. It is not my job to worry about another Realtors or buyers hurt feelings.

What I have found about handling offers is that many Realtors do not have a clue about Massachusetts laws when it comes to this subject. It seems there are quite a few that like to make their own determination of how things should work.

Here are a couple of mistakes that I see constantly being made in this business from agents that don’t know any better.

In Massachusetts all offers whether verbal or written must be presented to the seller.

It is not at the listing brokers discretion to determine what is or isn’t worthy the sellers consideration. No matter how crazy an offer sounds, it is not up to the listing agent to be the judge of the offer. It is a violation of the code of ethics to withhold any offers whether verbal or written.

Do you know how many Realtors I know that flat out say they will not present an offer unless it is in writing? Lots! In fact just last week another agent was asking me about presenting offers because she was taking a continuing education course and the instructor told her that she did not have to present an offer unless it was in writing. It seems crazy that someone who is teaching Realtors what is proper or not does not even know the laws themselves!

One of the other biggest myths surrounding Real Estate offers in that a Realtor can not reveal the terms of a buyers offer to another buyer or their agent.

Don’t believe this is true? The Massachusetts Association of Realtors standard listing contract states the following:

“Seller here by authorizes the broker to disclose to perspective buyers whether an offer has been submitted on the property and to disclose whether the offer is from a buyer introduced to the property from the listing agent, by other licensee associated with the broker, or by a cooperating broker.

Disclosure of the price and any other terms of any offer shall remain confidential until closing, unless otherwise authorized by the seller.”

The key here is that the seller needs to give their agent permission to reveal any terms and conditions of the offer to another party.  If providing this information could help the seller achieve a better price for their property then the Realtor should be doing whatever it takes, as long as it is within the legal boundaries of the law. The seller’s agents fiduciary duty is to get the seller the best terms and conditions possible.

A Realtor who reveals the terms and conditions of a competing offer without the sellers authorization to one buyer, gives that buyer an obvious advantage over the others which breaches the duty of fairness owed to the other buyers.

When  it comes to Handling multiple Real Estate offers in Massachusetts there is quite a bit to consider. At the link provided I have summarized everything you should consider as a Massachusetts home seller when you have multiple offers on the table.

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About the author: The above Real Estate information on handling offers when selling a Massachusetts home was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Southboro, Westboro, Ashland, Holliston, Upton, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

As a Massachusetts Realtor who has been around the block a few times, I often come across things that are written and said by other Realtors that just want to make me scratch my head in disbelief.

All this head scratching could partially explain why I started to lose my hair at such an early age!

One of the biggest myths in Real Estate at least in Massachusetts is a homes assessed value having a correlation to it’s present market value.

Unfortunately it is easy to see why the general public is often times confused about this because a number of Real Estate agents fail to educate their clients that there is a big difference. Trust me looking at assessed values is no better than using Zillow.com to figure out what a home is worth!

When the assessed value from the town is higher than what a property is on the market for you will often see Realtors writing advertising that says something like the following “Come see this bargain home that is priced $75,000 less than the assessed value”. What this immediately tells me is the Realtor either does not know anything about property valuation or they think there will be someone foolish enough to believe the home really is a steal. Someone that knows better is going to be thinking the property has been over assessed by the town and the seller has been paying too much taxes!

Of course on the other side of the coin you will see home buyers who see a home listed higher than the assessed value and if they have not been educated properly by their buyers agent, will improperly use this as part of their negotiations when making an offer. If more people were better informed they would know that assessed values are a worthless piece of information when evaluating what a property is worth.

Most people realize that market values of homes in many parts of Massachusetts have dropped quite a bit over the last five years. As values were dropping there were many that believed their taxes would also be coming down too. When people misconstrue that assessed values and fair market values are the same they will automatically come to this conclusion.

In theory this should be the case but assessed values are nothing more than a yard stick for a municipality to collect an appropriate amount of taxes to sufficiently cover the state and local appropriations chargeable to the city or town.

The assessed value of a property often lags the market because the valuations are not re-calculated until the beginning of the next calender year. So if the market values of homes are dropping it is not unusual to see the assessed value being higher. Likewise if values are going up it could be just the opposite.

Over the years I have seen some of the strangest things when it comes to assessed home values. Believe it or not I have seen some homes that are as much as a couple hundred thousand over or under assessed in comparison to their sales price.

I have seen two homes built by the same builder side by side where home “A” was larger and had a bigger lot than home “B” yet home “B” was charged more in taxes due to a higher assessed value. Kind of mind boggling don’t you think?

What I have also observed is that a home that has re-sold more recently will usually have a more accurate correlation of it’s market value compared to it’s assessed value than a home that has not sold in a long time.  For example, a home that sold three years ago more times than not would seem to have a more accurate correlation than a home that has not sold in ten years.

Yet another example is the home owner who feels they are being over assessed by the town and decides to challenge and wins an abatement. Their assessed value is now reset to the lower value. Does every other home owner who has a similar property get a notice in the mail saying their homes assessed value will also be coming down courtesy of the research done by Mr. Jones next door. Fat chance amigos!! This is the case of the squeaky wheal getting the grease.

So what are you supposed do if you think your assessed value is out of line with other like homes in your neighborhood or town?

You should head to your local assessors office and file for a tax abatement! All the information necessary regarding the application process and the deadlines for filing should be made available to you.

Applications for abatement’s are due on or before the due date for payment of the first actual bill. The towns assessor has up to three months in Massachusetts to act upon an abatement request.

If you are denied your abatement request and do not feel that the assessor made the proper ruling you have the right to appeal to the State Appellate Tax Board.

In summary an assessed value is the valuation placed on a property by a public tax assessor for purposes of taxation. Fair Market Value on the other hand is the agreed upon price between a willing and informed buyer and seller under usual and ordinary circumstances. It is the highest price which the property will bring when exposed for sale on the open market to a buyer who is purchasing with full knowledge of the properties highest and best use.

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About the author: The above Real Estate information on Massachusetts assessed values v.s fair market value was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Upton, Southboro, Westboro, Ashland, Holliston, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.

The Massachusetts Homestead Protection Act is one of the biggest no- brainers for any homeowner in Massachusetts to take advantage off.

Quite simply, an estate of homestead is protection for a persons residence from most creditors. The declaration of homestead protects the equity in your home for up to $500,000 in the event you are sued. In other words, if you are sued, $500,000 of your equity could not be touched by an attachment and subsequent levy on execution of sale. Unfortunately today we live in a litigious sue happy society. The chances of getting into an accident and someone suing you can not be overlooked!

The Homestead form is filed at the registry in the county that your home is located in.  All that is required is the preparation and recording of a Declaration of Homestead and the payment of a state recording fee. The total cost is typically around $100 to prepare and record the instrument. You could ask your attorney to prepare this document for you or possibly even the lenders attorney if you don’t have legal representation with your home purchase.

If you are married it only needs to be filed by one person and the other spouse is protected as well. You will typically see this document filed at the registry with all the rest of the closing papers on the purchase of a home.

There are some things that the homestead declaration does not protect against.

The following are exempt from the Homestead Law:

• Federal, state and local taxes, assessments, claims, and liens;
• Mortgages used to purchase the residence, and in the case of the elderly homestead, first and second mortgages held by financial institutions or others;
• An execution issued from the Probate Court to enforce its judgment that a spouse pay for the support of a spouse or minor children;
• Where buildings on land not owned by those declaring of a Homestead estate are attached, levied upon or sold for the ground rent of the lot whereon they stand;
• Upon an execution issued from a court of competent jurisdiction to enforce its judgment based upon fraud, mistake, duress, undue influence or lack of capacity;
• Debts contracted prior to the acquisition of the homestead.

The protection only extends to one primary residence. You can not have homestead protection on multiple properties.

There are some changes that have been proposed that would change how the mechanics of how the Massachusetts Homestead Protection works.

The new bill was filed on January 2nd 2010 and is known as House Bill No.1584. Below is a summary of the changes:

Automatic Homestead. The bill as proposed would automatically provide protection up to $125,000 of home equity for all homeowners, regardless of whether the homeowners have filed a declaration or not. Homeowners who record a homestead declaration would still receive protection of their equity up to $500,000.

Signature. A flaw in the homestead protection statute is that only one of the owners may file a homestead in any home. Under the current statute, joint owners, including spouses, currently have to decide which of them is more likely to have liability for a claim that is not covered by insurance or who is more likely to get sued. The proposed Bill would allow both spouses to file, even if only one spouse is named on the title.

Second Homestead. Under the new Bill, a second homestead filing would relate back to the date of the first filing. This would protect against liability incurred between the two filings that could compromise the second declaring parties equity.

Trust. Completely changing the current statute, the Bill would provide protection to beneficiaries of trusts that hold title to the residence, provided that the home is, in reality, the beneficiaries’ principal residence.

Transfer of Title Between Spouses and Co-owners. Currently, spouses or co-owners who transfer title between themselves without explicitly retaining homestead rights inadvertently terminate their right to protection. Under the new homestead protection act, transfers among family members will not terminate a previously declared homestead  even if the homestead is not reserved in the deed.

Home Sale Proceeds. Under the current homestead protection law there is no protection for homeowners who sell their home and do not immediately reinvest the proceeds in a new principal residence. With the new revision proceeds from the sale of a home would be protected for up to a year and two years for casualty/insurance proceeds.

Mortgage. Lastly, the Bill would prohibit mortgage lenders from requiring homeowners to terminate their homestead rights in order to secure a mortgage.

Whether these new modifications take place or not, having Massachusetts Homestead protection is one of the wisest investments any home owner can make!

UPDATE ~ As of December 2010 the Massachusetts Homestead amendment has passed. The highlights of the bill as described above are the automatic homestead protection up to $125,000 without having to file a homestead document at the local registry, homestead remaining valid if the home is transferred to another family member, homestead remaining in force under a refinance, as well as providing additional protection for home owners who receive insurance proceeds from fire or other damages.

The homestead protection act also now provides coverage for those who have put their home in a trust. Lastly, closing attorneys in mortgage transactions must now provide borrowers with a notice of availability of a homestead.

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About the author: The above Real Estate information on the Massachusetts Homestead Protection Act was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Hopkinton, Milford, Upton, Southboro, Westboro, Ashland, Holliston, Mendon, Hopedale, Medway, Franklin, Framingham, Grafton, Northbridge, Shrewsbury, Northboro, Bellingham, Uxbridge, and Douglas.