BEFORE SELLING YOUR HOME...
Select an Agent
& Hammer Out the Details
- Interview a few real estate agents or select one you have a high degree of confidence in selling your home successfully.
- You'll have to sign a Real Estate Listing Agreement with the agent, this is a contract that spells out three important items:
- How much commission your paying out. The seller typically pays 5-6% of the selling price in commissions. These are shared between your real estate agent and the buyer's agent.
- The price at which you are putting your home on the market.
- The period of time you're allowing the agent to sell your home.
Get Inspections
Get pest and home inspections - They typically cost $600-800 combined. Inspections will point out defects in your home, but it's much better having a buyer make an offer knowing this information then accepting an offer only to have it fall apart later when the buyer gets his own inspections. There's nothing worst when selling real estate then having to put a home back on the market after it went pending for a period of time. You lost momentum and people will wonder if the buyers pulled out because there's something very wrong with the house.
Make Necessary Repairs & Prep Home for Show
If you want to maximize the price you get for your home, then make necessary repairs to it before putting it on the market. You will also want to possibly paint, re-carpet and touch up the landscaping to maximize the curb appeal. You may also want to rent a storage unit to remove clutter from the home including some furniture to open up spaces. When you're selling real estate, you do not want your home to have that lived in look. It should look spotless.
Prepare Disclosure Packets
There are many real estate disclosures that need to be filled out by sellers. It is best to have these completed before putting the home on the market so that buyers have immediate access to the information. It's best to complete these forms after repairs have been made so that it is reflected in the documents.
Marketing
Your real estate agent should have discussed how they intend to market your home to bring in qualified buyers. While you're getting your home ready, your agent should be preparing his materials: postcards, fliers, web sites, etc. It may even be wise to begin marketing your home before it's ready for visitors. This way, if another neighbor is also selling their home, a potential buyer may wait to see what you have to offer before they commit to the other house.
READY FOR MARKET
List in MLS
Once your home is ready for sale, it should be added to the Multiple Listing Service immediately. This is the largest database realtors and buyers will be looking in for homes to purchase. It is almost impossible to sell a home without adding it to the MLS.
Lockbox & Signs
A lockbox should ideally be added to your home to allow agents to bring in clients. Homes that are listed by 'appointment only', tend to linger on the market longer. A 'For Sale' sign prominently displayed on your front yard also alerts people driving by that the home is for sale. Sometimes your neighbors have family or friends that would like to move into their neighborhood. Trying to sell a home without a lockbox is difficult. Buyers are people juggling jobs and family obligations so trying sometimes to make their schedule conform to yours may discourage many from visiting your home.
Agent Tours & Open Houses
Your home should be open for real estate agent tours. These tours allow agents to preview your home and determine if its a good match for one of their clients. Open houses on weekends will also bring in potential buyers. Although the majority of homes are sold because an agent brought a client to the home, more often today buyers are seeing homes without their agents.
LISTEN TO OFFERS
When to listen to offers depends on the real estate market. In 'hot' real estate markets sellers often set offer dates to create a bidding war and increase the final selling price. In slower markets it's risky to set dates since the date may pass and no offers are submitted. This tells a potential buyer that no one else is interested and they will likely be coming in below your asking price.
Hopefully the buyer and seller agreed upon a fair price and other terms and thus we have a 'ratified' real estate contract. This contract then becomes the escrow instructions.
ESCROW BEGINS
Escrow typically lasts about 30-45 days. This is the period of time where the Title Company and the Banks perform their tasks. The bank will determine if it will loan the money to the buyer to purchase the real estate and the title company will investigate who has a lien on your house. These liens will need to be removed (except for property taxes) prior to title transferring to the buyer.
There is little required of a seller during most of the escrow process. Usually about a week before escrow closes, the buyers and sellers will go separately to the title company to sign the necessary loan and title documents.
Contingency Removals
Typically there are conditions in the real estate contract that allow the buyers a certain grace period to complete inspections, receive documents and returned them to the sellers. Buyers have some rights to cancel the real estate contract until this period expires.
Upon the expiration dates of these rights, the buyer should give the seller signed documents stating they are removing the agreed contingency. Once all contingencies have been removed, the buyer is in breach of contract if they fail to go through with the real estate purchase.
Close Date
On the date escrow is suppose to close or the day before, the buyer's bank will fund the loan to the title company. The title company will pay off any liens on the sellers' property and gives the sellers the remaining amount of money. The title company also goes to the county and records that the title to the home was transferred to the buyers.
By the end of the day, the seller has their money and the buyer has the keys to the house.
Selling a home is serious legal business. While thousands of people do it everyday, the consequences are poor decisions can be costly. So get good advise and someone experienced to assist you through the real estate selling process.
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