Sellers should be wary of Internet 'moving brokers'
Internet "moving brokers" offer to help sellers find the best deals on moving companies, but some do sloppy work, and others are outright crooks.
Q. We recently sold our home. Our new house is about 1,200 miles away, so now we are looking for a moving company to transport all of our belongings. We recently received an e-mail from a "moving broker" that does business over the Internet, stating that he works with more than two dozen moving companies and could help us find the company that would do the job for the best price possible. How do these brokers work? Are they legitimate?
A. Moving brokers work much like mortgage brokers, promising to find the best money-saving deals available. Some charge consumers upfront for their services; others are paid referral fees by the companies they recommend; still others use a combination of both compensation methods.
While some moving brokers are indeed legitimate, many others are not. A research project conducted a few years ago by the American Moving and Storage Association, a trade group that represents about 3,000 certified moving companies across the U.S., involved a Web search for a hypothetical move from Florida to Washington, D.C.: The eight Internet brokers that the group checked recommended a total of 51 movers, but further investigation by AMSA found that a staggering 37 of them were unlicensed.
Again, some brokers are indeed legit and can save you money by shopping around for the best deal on your behalf. But a sloppy broker might hook you up with an incompetent mover that has a long history of complaints or, even worse, be in cahoots with a company that promises a bargain-basement rate but then holds your possessions hostage when it arrives at your new place until you pay more money.
To protect yourself from unscrupulous movers, ask for referrals from friends, neighbors and a local real estate agent whom you trust. Ask at least three of those movers to submit bids after visiting your current home to review all your possessions: An in-house visit is the only way that a legitimate mover can give you an accurate price quote.
An in-house visit also will help you assess how professional and reliable the company seems. Call the local Better Business Bureau to find out if the mover has been the target of complaints in the past and, if so, whether the gripes were resolved to the customers' satisfaction.
The American Moving and Storage Association operates a good Web site (moving.org) that provides more tips to help select a mover. It also includes a search function that allows users to determine whether a company is licensed by the Department of Transportation to handle interstate moves, and it offers a free online referral service that can give you up to six in-home bids from companies that have passed the trade group's background check and agree to adhere to its code of ethics.
Q. What is an "ad valorem" tax?
A. "Ad valorem" is the Latin term for "according to value." It's a method of taxation that uses the value of the property that's being taxed to determine the actual amount of taxes that must be paid.
In most states, annual real estate property taxes are ad valorem because they're based on each home's value: Taxes on a mansion worth $1 million will be higher than taxes on a small house worth much less.
The other type of tax is known as a "specific" tax. For example, a $100-per-year tax that a county levies on all properties in the area - regardless of value - in order to improve local schools would be considered a specific tax.
Q. I am interested in finding a foreclosure to purchase. How can I find out what properties are available?
A. If you already know which area you'd like to invest in, contact a few real estate brokerages in the community that you have targeted and ask for their help. Several real estate firms across the country now have so-called "foreclosure specialists" who spend most of their time tracking foreclosure listings and, equally important, dealing with the banks or private investors who now own the properties and are trying to sell. Their experience and business connections can be invaluable, especially if you have never invested in a foreclosure before.
Several Internet sites have recently sprung up to provide lists of foreclosures in various areas, but some are clearly better than others. The worst ones charge huge monthly or annual fees only to provide outdated information on properties that often have already been sold and are no longer available.
Perhaps the best site for finding foreclosures is RealtyTrac.com, which provides free updated information on both foreclosed properties and "preforeclosures." Buying a preforeclosure sometimes can provide even bigger savings than purchasing a property that has already been foreclosed, because it spares the bank from having to pay thousands in legal expenses and thousands more in fix-up and marketing costs.
The site also provides detailed information about the various ways to purchase foreclosed homes, as well as info to help homeowners who are behind on their payments and are facing foreclosure themselves.
• For the booklet "Straight Talk About Living Trusts," send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960.
© 2009, Cowles Syndicate Inc.