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Elaine Abercrombie: Appoint an Equity Guardian

A Realtor can be your best protection against losing money

Elaine Abercrombie
Elaine Abercrombie (Roe Anne White photo)

Planning to sell your home soon? Do you know how much equity you have? When preparing to sell, determine the amount of equity received from the sale — before marketing your home.

Equity is calculated by deducting the amount you owe from the present value of the property. The first step is to make a determination of present value. This can be done in two ways.

Ask your Realtor representative to perform a “Comparative Market Analysis,” showing the recent sale prices of other homes similar to yours. The purpose is to help you arrive at a reasonable selling price for your property.

Another way to establish the value of your home is to order a certified appraisal, an unbiased evaluation of the “fair market value” of your home.

Now, subtract your loan balance from the value. What remains is called “equity,” the part you get to keep upon the sale of your home. It should be carefully guarded from low offers and bargain-hunters.

Your best protection against loss of equity is the Realtor you choose. It is the Realtor’s responsibility to attract qualified buyers and negotiate the highest possible sale price. As your representative, the Realtor has a fiduciary obligation to represent your best interests.

The benefit to you is the enjoyment of the highest possible amount of equity.

Elaine Abercrombie, a broker with Abercrombie Fine Homes, is president of the Santa Barbara Association of Realtors. She can be contacted at .(JavaScript must be enabled to view this email address).

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