Most people who have bought and sold properties while in the military are familiar with USAA’s MoversAdvantage incentive program. As you can see in the chart above for a great majority of home buyers you can expect to get right around $1000 cash back around 2-3 weeks after closing. Everyone loves $$$ especially around the time of a home purchase or sale. Seems like a great deal!
What most people do not understand is how it works and what the downfalls of using the program are.
Trap #1 – You do not pick your Realtor, USAA does. The relationship between a Realtor and client is an important and personal one. Letting a bank pick that agent is akin to walking into the barbershop and sitting down in the first open chair. You may get a good haircut from someone with experience but you could end with a guy with an license that still has wet ink and end up looking like Lloyd Christmas.
Trap #2 – The Realtor is required to complete some special training to earn their spot in the free referral cue. This training certifies them to work with the military. I do not care how many classes you take, to truly know how to work with the military you need to live it or have many years working with military. Out of town military members often come with tons of questions. The Realtor assigned to a client should go in knowing that buying a house with a military member means instant equity is of the utmost importance. That means finding properties that appraise over the asking price, finding a house with sweat equity potential, or even a ready made rental property for the end of their tour. People in uniform are on a 3 year not 30 year plan when it comes to home buying.
Trap #3 – The incentive cash is coming from somewhere and it is not USAA. With a cut of your commission gone even the must disciplined of Realtors will prioritize their time. In case it wasn’t obvious Realtors do not get paid by the hour. With the military the spectrum of clients you could spend six months to as little as two weeks searching for a home. When the commission is 2/3 of what it normally is which one do you think the Realtor’s prefer?
Compound the aforementioned traps and you get a dangerous situation where a Realtor is working for less, not completely understanding his clients needs and dealing with extensive lengths of time or critical time crunches. All of these extremes all come together on a blind date courtesy of USAA.
Do yourself a favor and take the opinion of your friends in the service. Ask the right questions, do your homework, and find the Realtor who is right for you. A $1K rebate may be enticing to some but that amount of money could shake out in the closing costs or during the negotiations with the right Realtor providing a premium service that your Real Estate decisions require.