With so many homes now up for sale, some sellers are offering realty agents a bonus to find a buyer fast.
Q–Our house has been up for sale for two months, but there are many other homes in our neighborhood that are also for sale. Our agent has suggested that we offer an extra $1,000 or two airline tickets to Hawaii as a bonus to any sales agent who produces a buyer for our property in the next 30 days. Do you think this would really help our marketing efforts? More important, would it be legal?
A–Yes, offering a bonus would be a perfectly legal way to boost your chances of selling the home quickly.
The commission you will pay to your agent when the home is sold will likely be split 50-50 with the agent who represents the buyer. Offering a “buyer’s agent bonus” on top of that commission could encourage more of those agents to show the house to their clients. The added exposure could make the difference between selling the property in the next few weeks or having it sit on the market for months.
Before you offer a bonus, though, ask your own agent for a list of other ways to bolster your marketing campaign. Since there are several homes for sale in your area, you may want to consider cutting your asking price or making other concessions to lure a buyer. Offering a bonus to local sales agents won’t make an overpriced property sell, but it could make a fairly priced house sell faster.
Q–My husband and I are both over age 60 and we are applying for a mortgage to purchase a retirement home. The application asks for both our ages. I don’t think my age is anyone’s business and I don’t want to be discriminated against because I have a little gray in my hair. Isn’t it illegal for a lender to ask your age?
A–It’s perfectly legal for a lender to ask the age of a loan applicant. However, federal law is very specific about how such information can be used to determine a borrower’s creditworthiness.
Under federal law, a lender cannot reject your loan request or offer you less credit merely because you are a certain age, be it 18 or 88. Lenders are also prohibited from closing an existing account or asking you to reapply for a loan simply because you reach a specific age or retire.
It’s also illegal for a lender to deny credit or to unilaterally close an account if your age prevents you from getting credit-life insurance that would pay the loan balance off when you die. Many states provide additional safeguards for older borrowers.
While it’s illegal for a lender to flatly deny credit based solely on your age, it’s OK for a financial institution to ask how old you are and then consider some types of age-related information when reviewing your application. For example, if you are 64 and expect your income to be cut in half because you are about to retire, a lender would have the right to offer a lower amount of credit than it would to a younger person who had plenty of working years ahead.
Older borrowers should also be aware that any Social Security benefits they collect can be listed as income in order to increase their chances of getting a loan. In fact, many lenders give favorable treatment to Social Security beneficiaries because they know the government will provide the borrower with a monthly check for as long as the person lives. Private-sector companies don’t make such promises to their workers.
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For a copy of our booklet, “Free and Clear: Getting the Mortgage Monkey Off Your Back,” send $3 and a self-addressed, stamped envelope to David Myers, P.O. Box 2960, Culver City, Calif. 90231-2960.
