Pre-Qualification and Pre-Approval

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Lender Letters

When you are selling your home For Sale by Owner or even with an agent, you’ll need to understand what kind of approval is provided with an offer. Many people get pre-qualification and pre-approval mixed up but they are entirely different as to how secure their financing is.

Always inspect lender letters carefully

The mortgage industry often times provide relaxed letters of qualification or approval for clients who may or may not be able to close on the house. 

We will look at pre-qualifications and pre-approvals further below.

Pre-Qualification

What is a pre-qualification Letter

Pre-Qualifications are lender letters based on estimates of a buyer’s overall financial situation.

Estimates on debt, income, and assets are provided to the bank or lender. The lender then reviews everything and gives a price range of how much the borrower can expect to receive.

These can be done online or directly with lender. Furthermore, they are typically free to complete.

How is it Different than a pre-approval?

Pre-qualification is quick, usually taking just one to three days to get a letter. Keep in mind that loan pre-qualification does not include an analysis of credit reports or an in-depth look at the borrower’s ability to purchase a home.

The lender in a pre-qualification usually does not receive any documentation. The potential borrower is verbally providing an idea of who they are financially.

A pre-qualified buyer does not carry the same weight as a pre-approved buyer. As a Realtor, I tend to stay away from pre-qualified letters for offers and request that the borrower go back and get a full pre-approval.

Pre-Approval

What Is a Pre-Approval Letter? 

A pre-approval is an offer (but not a commitment) to lend a specific amount, valid for 90 days.

Getting a pre-approval involves extra steps for the buyer, but it further ensures a borrower can close a deal.

This type of letter is usually based on firm financial records. Bank statements, W-2, 1099, tax returns, investment accounts or credit scores are generally used.

The borrower must complete an official mortgage application to get pre-approved, and supply the lender with all the necessary documentation to perform an extensive credit and financial background check.

The lender will then offer a pre-approval up to a specified amount.

Lenders will provide a conditional commitment in writing for an exact loan amount, allowing borrowers to look for homes at or below that price level.

This puts borrowers at an advantage when dealing with a seller because they are one step closer to getting an actual mortgage.

Side note

Remember there are still conditions to be met on the mortgage side, even with a pre-approved letter.

You should always call the lender and have a brief discussion about the pre-approval letter.

Find out if there is anything major lacking from the file that could cause the loan to pause or be denied at later date.

Make sure they have reviewed credit, all documents and ask if they owe the lender anything.

Sellers

DO NOT BE AFRAID TO ASK QUESTIONS TO THE LENDER OR BUYERS AGENT!

Pre-Qualification and Pre-Approval

Service Coverage

If you have a question about buying or selling your home, please reach out to Joseph Walter Realtyat 248-294-7849 or via email: info@josephwalterrealty.com 

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.


How to Get On the MLS

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For sale by Owner Versus Using Realtor

FSBO VS Realtor

When you decide to sell your home, you have 2 options. You can either sell it on your own as a For Sale By Owner, or use a professional Realtor. Each option has the main goal to get it sold, however the methods used by each may differ drastically. Below are comparisons of how typical real estate aspects are handled by both a for sale by owner and a standard realtor.

Pricing

FSBO

When selling on your own, you will decide on the price you want to sell your property. FSBO usually will do this by looking on FREE public websites like Zillow to determine value. These sites have information, but how relevant and accurate is unknown. FSBOs also use what their neighbors have sold for or what the neighbor’s current home is being sold for. Each home will have different square feet, updates, and condition of the property itself, which will affect value. Emotional value can lead to pricing the home wrong.

Realtor

Realtors have tools that can help define a value. They have access to all the relevant comps that have sold in the area. They know which can and cannot be used for your specific home. Realtors will also walk the property to review it and then compare back to the comps. Adjustments will be made for updates, condition, square feet, appliances and more. A Realtor does not have emotion when it comes to pricing. It is based on data and the home itself.

See more on Home Valuation Here

Forms

FSBO

All forms must be purchased. A Seller must provide certain documents to potential buyers to keep in compliance. Sometimes the sellers cannot get access to the documents needed. If a buyer without an agent wants to make an offer, one of the parties must seek out a purchase agreement that both sides agree on using. You should not use a FREE or general agreement.

Realtor

Realtor has access to all documents needed to put a home up for sale. From listing agreements to required documents that must be accessible by other Realtors. A Realtor also has a good purchase agreement that has been used many times.

Marketing

FSBO

When you are selling the property on your own, you must find the best ways to get it in front of potential buyers. There are several websites out there and social media that can be used. Some of these websites connect with others, but you will be doing the marketing one by one, setting up new profiles, logins, and listings. When you make changes, you will need to login to each one and update the information and/or photos. Social media is good, but like real estate websites, you will have to post to each individually.

Realtor

When a Realtor does the marketing, they use the MLS. The MLS is a portal for thousands of Realtors and real estate professionals to search and find homes for their clients. The MLS also connects to thousands of other websites automatically sending out information on listed homes to be seen by potential buyers. When changes are made on the MLS, they are updated on the 3rd party websites in seconds. Realtors also use social media to connect with potential buyers and other Realtors. There are many platforms and sub-groups within these platforms that Realtors use. One of the biggest tools Realtors use, is email (CRM) to get the listing in front of Realtors and clients. Realtors keep solid databases of contacts to be able to market to them in a click of a button.

Showing Houses

FSBO

Someone selling the home on their own will be taking all the calls on their own, setting up appointments, tracking the appointments, and then following up on the appointments. The FSBO must find ways to verify who is coming to see the home. How does a FSBO ensure that the people coming to their home, to go into their personal space, are Realtors with potential buyers and not just people wanting to wander through the home. FSBO also must provide access information to those who request to see the home. They provide lock boxes, leave the door open or stay to let the requested viewer in.

Realtors

A Realtor working to sell your home will monitor all showing requests. Realtors use technology and tools like ShowingTime to approve or reject showings based on the needs of their clients. Those who have access to request showings through this tool are licensed Realtors, allowing the Realtor and their client the safety of knowing that the person showing the home is legit. The tool also only allows lockbox codes once the showing is approved. Another tool Realtors use is electronic lockboxes. This adds another level of security, with being able to track access when it starts and ends. It also does not have the same code being used over and over. It uses the Realtors phone to connect with the box to get to the key. Realtors also get showing feedback from the showings that allow them to analyze the thoughts of the other Realtors and clients who have seen the property.

Offers

FSBO

When an offer comes in to a FSBO, the home seller must review the doc and understand it in its entirety. Many purchase agreements have legal terms and deadlines that can affect the outcome of the sale. FSBO must negotiate with a professional Realtor. Another part of the offer is the review of the buyer’s mortgage approval. If there is a cash offer, this can be another challenge when requesting the docs to show the buyer can close cash.

Realtor

A Realtor handles offers of real estate for a living. They have seen the various wording and versions of local real estate companies and knows what to look for regarding price, deadlines, and concessions. Purchase agreements seem like boiler plates, but they can come with some legal issues if one side fails to perform. If there are issues found after the bottom line, it can be difficult, if impossible to correct. A Realtor knows what to review to not have issues. Realtors are also professionals when it comes to reviewing approvals from mortgage companies. They know the right questions to ask the mortgage companies. If a cash offer comes in, the Realtor knows how to request and review the right documents to make sure the cash is available to close.

Post Offer

FSBO

After the bottom line of an offer the seller must make their home available and handle the inspection and appraisal, along with requested walk-throughs. Depending on the outcome of the inspection and appraisal more negotiations may happen to request a reduction of price or change to the terms of the purchase agreement. This can be difficult for a FSBO since they do not have access to comps and other current information or understand the write up of the inspection. It is much harder for a FSBO to argue appraisal valuation and the buyer’s agent will not help since they want the best pricing for the buyer. They do not work for seller.

Realtor

A Realtor will handle the inspection and appraisal. Your Realtor will review both the inspection and appraisal as it comes in. If there are additional negotiations, they will review the requests and make their opinions. Some buyer’s agents look to offer one price, knowing they will ask for a reduction after an inspection. Realtors also can review inspections to see if the requests are correct or just a way of getting a price reduction. A Realtor can help argue valuation if the appraisal comes in lower than the purchase price by proving comps that are recent and that match the subject property. A Realtor who prices the house right will have the information to back up value when an appraisal comes in lower than expected.

Closing

FSBO

When documents come in for the closing. A FSBO will need to look at all the costs and understand what is being charged to them and to the buyers. A closing statement has a lot of fees, commissions, payoffs, and taxes. If there are errors in items like commission, you will need to negotiate and work that out with the buyers Realtor. Doing this can delay or cause the closing to not happen.

Realtor

A Realtor knows how to review all closing documents from the closing statement, the title work, and all docs required to sign. A Realtor will make sure that all charges are to the right party in order to have a smooth closing. Any discrepancies the Realtor should have documentation to back it up, especially commission, which is part of the listing.

 

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email at info@josephwalterrealty.com

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

 

For Sale by Owner and the Buyers Agent

Being a For Sale by Owner or FSBO, you will most likely still be dealing with a buyer’s agent. Many times, these buyer’s agent will seem as though they are there to help you, but THEY DO NOT REPRESENT YOU – THEY REPRESENT THE BUYER.

When you are selling a property or business on your own, be aware of the overly helpful buyer’s agent who has NO AGENCY AGREEMENT with you. They will present the offers on their forms and make all sorts of suggestions which will “HELP THE PROCESS ALONG” – most likely in their clients’ favor.

Read the purchase agreements all the way through and look for some of the following items:

  • OTHER ITEMS SECTION:
    • This is a section in almost all purchase agreements where custom requests are done, such as:
      • Seller to Pay XXX in Concessions
      • Seller to make all repairs from inspection
      • No EMD
      • EMD to be returned to buyer under all circumstances
    • Property Description Section:
      • Lists Appliances
      • Does it list other items you did not want to include
    • Taxes – make sure you are only paying for taxes on the days you are responsible.
    • Repairs – some purchase agreements have a section for inspection and municipal repairs and who pays them.

 

The buyer’s agent may also want to suggest you work with their title company. If your state allows, choose to do a split closing where you have a title company separate from theirs. Some states the seller picks the title company and other states the buyer does. There are also some states where an attorney is involved in all closings. You may want to reach out to a title company in your area to find out how your state does closings – you can call Inked Title who works nationally and someone can help provide information at 248-617-0004 or email info@inkedtitle.com

Do not feel pressured to use any services offered by the buyer’s agent.

(title company, home warranty, repair company, etc.)

 

Selling your home on your own has many moving pieces. Stay in control of your deal and stay in contact with the people you choose to provide services. A lawyer is always a good idea or a transaction coordinator to help review documents and get you to the closing with the greatest of ease.

A transaction coordinator is a licensed real estate professional who will charge a small fee or percentage of the sales price (much lower than the full service Realtor) to review docs, may help negotiate, and handle the process from offer to close to you getting paid.

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email at info@josephwalterrealty.com

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

 

 

 

 

 

Marketing your Property

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Role of Marketing in Real Estate

If you want to sell by owner, you will have to take on the role of the marketing department.

Many for Sale by Owners only rely on free listing websites or the MLS to market their property. Depending on the market we are in, this can work in your favor. However, remember your home is now amongst hundreds if not thousands in your market, all trying to do the same thing.

Additional Marketing for your property

Additional marketing for the property is a common service for experienced realtors to do. This is where a majority of our time and expenses come in. A few examples are neighborhood mailers (yes they are still a thing in the digital age), advanced web marketing, email blasts and digital marketing on all the social media platforms.

Marketing your Property as a For sale By Owner

You should start by deciding an advertising budget and how you would like to use it toward selling your home. There is no magic number when it comes to budgeting and selling your home.

Lets start simple and work our way through some marketing options and you can start to decide in your head what you feel is appropriate to spend on the sale of your For Sale by Owner home.

MLS Only Listing Marketing

This markets your property on the MLS of your local area through a Broker, but still allows you to sell it For Sale by Owner. MLS Only listings are a common and inexpensive way to get seen by the Realtors in your area. You generally pay a small fee or flat fee, and the Broker will list your home on the MLS.

MLS Only Tip

MLS Only listings should have your name, number, and e-mail as the contact information (some MLS systems have different rules, but you should have at least your number). You should also be set up with a showing application that will help you receive and reject REALTORS who have clients to see your home. These showing applications are used only with licensed Realtor/agents.

There are many companies that offer this service which ranges between $199 and $499 for the basic service. Check out  www.RealEstateFlatRateListing.com and click on the coverage by state to help list in your area.

Social Media Marketing

Facebook, Instagram, Twitter, and many other platforms draw people to them every day for personal and professional reasons. They are good platforms to market your property and be seen by people you know and people you do not know.

Posting on your personal feed will get people to know you are selling, but it will take expanding your network to get your For Sale by Owner home noticed. To do this, you can boost an ad or create an ad. When you boost or create an ad, it will ask you where you want it seen. It will have you choose a city and how far out. Your ads will show up on the social media you are using for people who are registered within that distance. You can narrow down some demographics more, but usually a general radius is best.

Social media marketing allows you to set a daily or total budget for the ad. As you move up and down it will show you an estimated number of daily and total people you could reach.

Website Marketing

Making a website specific for the home is useful when it comes to showing people more than what they can find on the MLS, social media, and flyers. With a For Sale by Owner website, you can add as many pictures as you would like, videos, more descriptions, and it does not fall within the rules of the MLS.

You can get a domain from Godaddy or another web domain seller. These companies usually have easy to build website templates. Basically, they are drag and drop websites and very inexpensive.

You can also get help building one on our site here. We can make a website for you,  just provide the photos, video links and text for $249.

E-mail Blast Marketing

For Sale by Owners typically do not have the database of emails for real estate professionals and others who may be in the market for a home (if you do, then you are way ahead of the game).

You should still email your flyers out to family, friends and business associates and encourage them to pass it along. You never know.

Open House Marketing

As a Realtor myself I am torn as to whether an open house is worth the time and effort. Many real estate professionals use open houses to collect names, numbers and email of people who are buyers looking, but may not be interested in that specific home they are doing an open house for. Open Houses bring more curiosity from neighbors and window shoppers than actual buyers.

When your house first hits the market, it is not a bad idea to try marketing your property with an open house. If anything, you can ask for feedback from those who come on price and the home itself. Feedback itself can be valuable.

Mailers and Flyers Marketing

This can be an old school method in the world of digital marketing, but it can get the word out. By letting your neighbors know your home is for sale, you could run into someone who loves the neighborhood so much they would pass along the information to friends and family.

Flyers are also good to put up around town at places people gather. Please ask for permission before placing on bulletin boards and other public spaces. You do not want to spend money printing to have it thrown out.

For real estate professionals, e-mail blasts can sometimes be the biggest part of the budget.

Word of Mouth

Tell everyone you are selling! Word of mouth self-marketing is a tool that will always be useful. You never know who is looking to buy. From your dentist to your dog groomer to your hair stylist. They speak to people all day and are a wealth of information and connected to a whole different network of people. They can be your boots on the ground marketing team.

Joseph Walter Realty

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email: info@josephwalterrealty.com 

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

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What is a Flat Fee Listing?

Flat Fee Listings 

A Flat Fee Listing means a seller has paid their Brokerage an up-front fee for Real Estate Services. Brokers offer full services at higher costs, or limited service at lower costs.

Always make sure to clarify costs and services with broker to see what you’re paying for.

To see what an MLS Only listing is, please visit the post located  HERE .

The flat fee listing option can help save you money with a reduced rate of commission to get your home sold, but you will want to look at the terms.

There are companies that charge a flat fee and the payment is due at the closing, but there are companies that collect the flat fee when you sign up for the services. You will want to read through the flat fee contract thoroughly before signing.

Full Services

What is typically provided by Full-Service Realtors?

A full-service Realtor does a lot of work. There are more steps and processes that are handled, but that should give you the basics of what is considered full-service.

  • Property review and pricing
  • Photography/Video
  • Sign and lockbox
  • Marketing
  • Handling and following up from showings
  • Open houses
  • Review of offers and negotiating/re-negotiating
  • Review appraisals and inspection reports
  • Monitoring the deal to keep it moving toward close
  • Review of title work
  • Review of closing docs
  • Setting up and attending closings
  • Making sure you get your proceeds
  • Following up after close to make sure move went as planned

 

What is a Flat Fee Listing?

List Your Property

Service Coverage

What is a flat fee listing?

 

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email: info@josephwalterrealty.com 

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

 

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How to Get on the MLS

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The Multiple Listing Service

The MLS or Multiple Listing System is a database tool used by Real Estate professionals to list or locate real estate properties.

There is only one method to get MLS access: Use a licensed Realtor or Broker. However, there are multiple options for how you use the Realtor.

For Sale By Owner on the MLS

If you are looking to sell your home For Sale by Owner, you do not want or need the services of the Realtor, just their access to the MLS.

Few Realtors/Brokerages offer a flat fee MLS only listing options that can start at $99 and go up from there depending on the options and  you choose.

When you speak to the Realtor/broker, you will want to get specifics on what you are getting for your fee and if there are any hidden charges when the property closes or during the listing process.

You must also be aware; you cannot pay the Realtor directly. The fee for the access to the MLS must go through the Broker. The payment needs to be made to or through the broker. We do not recommend cash.

When the Realtor lists your home on the MLS, you will also want to make sure your contact information is being used.

YOU WILL SEE THE REALTOR AND BROKER INFORMATION ON THE THIRD-PARTY LISTINGS REGARDLESS OF LISTING TYPE.

This is because the Realtor or Broker is still listing the property, and that is the only way to get on the MLS.

Why Use the MLS?

The MLS is a good way to market your property to the masses, not only the MLS, but to many 3rd party websites that pull information from the MLS.

Part of the MLS is SHOWING TIME. This program is the scheduling system for Realtors to set up to show your property. The contact for this should also be your information.

How to Get on the MLS

List Your Property

Service Coverage

Joseph Walter Realty

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email: info@josephwalterrealty.com 

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

 

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What is an MLS Only Listing?

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MLS Only, Entry Only, Flat Fee, and Flat Rate Listings?

An MLS only listing generally refers to a For Sale by Owner (Limited Service) listing . MLS Only, Entry Only, Flat Fee, and Flat Rate Listings are synonyms for a specific listing type. Occurring when a Real Estate Broker places a listing onto the local MLS (multiple listing service) for a flat fee up front instead of a commission at closing. Due to classifying as a limited service listing, the For Sale By Owner (seller) handles all tasks of the sale including calls, showings, contracts and closings.

MLS access is a valuable and cost saving tool for those choosing to sell For Sale by Owner. The properties listed on the MLS are seen by all local Realtors. Who in-turn, have ready and qualified buyers looking in your area.

Direct MLS Only or Referral MLS Only?

Many companies across the United States that are either marketing companies that connect sellers with brokers to offer this MLS only service, or direct real estate Brokers who offer this service.

Make sure the company you are signing up with lets you know which one they are. Both can be solid options for getting your home listed, but you will want to know who to communicate with once you sign up.

MLS Only Benefits

What do you typically get when you use the MLS Only (Limited) service from a real estate Broker?

  • Listing on the multiple listing service

    • Packages will vary from company to company
  • Your contact information in the listing to be contacted directly

    • Brokers info will ALWAYS be in the listing since it is the only way to be placed on the MLS – they are not doing this to hijack your listing or buyer calls
  • Marketing on 3rd party sites like Zillow, Realtor and others.

    • Sites will vary depending on the MLS board and region
  • Showing Time or similar app.

    • This app is used to schedule and maintain showings on your home
  • Changes to the MLS Listing

    • Price
    • Status
    • Open House

For Sale By Owner Note

As a For Sale by Owner on the MLS, you will not have the same control as a full-service Realtor. 3rd party websites pull information from the MLS and your information may not pull with it. Realtors do not use Zillow and other 3rd party websites and cannot control them directly – they are updated and changed through the MLS. Even sites like REALTOR.com sound like they should be controlled by the listing company, but they too pull from the MLS.

MLS only listings typically do not get:

  • Someone to review and negotiate offers
  • Handle the process once under contract to get to closing
  • Review inspections and appraisals
  • Review closing docs

Some  MLS only companies will offer these as paid add-on services for those needing a little more help during the sale.

Pricing will vary depending on the company.

Service Coverage

 

Joseph Walter Realty

 

If you have a question about buying or selling your home, please reach out to Joseph Walter Realty at 248-294-7849 or via email: info@josephwalterrealty.com 

Thank you,

Scott Fader and Gary Brincat
Joseph Walter Realty

Joseph Walter Realty is a veteran owned company located in Michigan. Scott Fader and Gary Brincat are two of Michigan’s multi-million-dollar top producers. They have been working in real estate as brokers, Realtors, investors, property managers and real estate company owners for over 20 years. Together they would like to share their experiences, knowledge, success and failures to help buyers, sellers, Realtors, brokers and anyone else in the real estate and business, so that together we can grow as a community.

 

What is an MLS Only Listing?

 

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