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Fair and Square: 5 Keys to a Smooth and Legal Home Sale

Written by Posted On Friday, 14 April 2017 16:24

Selling your home can seem overwhelming. Showing your home will mean keeping it clean, hiding the clutter and always being ready for visitors. Dealing with the ins and outs of list prices and property values, negotiating contracts and understanding fine print—these are not things you necessarily do every day. What's the best way to prepare yourself for selling your home? Here are a few things you need to know about real estate transactions.

Choose Your Agent

The first thing to do is find a good real estate agent. Interview several realtors. You are looking for a selling agent who can sell your home, so find someone with the experience and knowledge to guide you through the process. Real estate agents work on commission, usually 6% of the price of the home. Typically, the commission is split so the agent who represents you (known as the listing agent or seller's agent) will get 3%, and the agent who represents the buyer (buyer's agent) will get 3%. Using just one real estate agent is called having a dual agent, and you can negotiate with your agent when you sign the listing contract for them to take a lower total percentage (4% or 5%) if they end up acting for both sides.

Understand Property Values

While it's true that a new kitchen or bathroom can improve your property value, other remodeling projects, landscaping and infrastructure repairs may not. Those little extras may help your home sell faster, but do not necessarily increase the value of the property. Think carefully about what you see when you look at someone else's house. Would you pay more for integrated fire alarms or a doorbell camera? Would you spend $5,000 extra on a house because the previous owners had to install a sump-pump or fix the foundation? Don't hold on to unrealistic expectations if it means making it harder to sell your house.

Find Your Bottom Line

Realize that there is a balance line where you trade off higher asking prices against staying on the market longer. Be realistic. Look at the tax assessment value for your place, and compare it to what similar properties are selling for on the current market. Your realtor will be able to help you find this information and will most likely present you with several options for your initial list price. You want to get back what you paid for it, and a profit would be nice. Just keep in mind that your home has been building equity, and you haven't had to pay rent. Even if you have to sell for a lower price, you are still coming out ahead financially.

Make it Work

You know how much you need to get out of the house in order to move to your new place. Your buyers know how much they are willing to spend. Negotiating back and forth so both parties feel they've gotten a good deal can take some time. Even if you cannot lower your price any further there may be other things you can do to sweeten the deal and keep your buyer at the table. Consider leaving appliances that weren't originally part of the deal, include the custom window boxes, or complete some minor repairs. It might not seem like a lot of value but it shows your sincerity and desire to make a fair deal, which might be enough to bridge the gap and bring them up to your price.

Lawyer Up

Once you have a purchase contract signed by both parties, you need to find a settlement agent. In some states this work can be done by a title company, lending institution, even the real estate office, but in every state you can use a lawyer as your settlement agent. In most cases, it is the buyer who will choose the settlement location, but the seller will need to provide the legal deed written by an attorney in good standing. That deed will be written on the basis of recorded documents from the local land records office of the courthouse. A title search, or title abstract will be done to verify that the property is where you say it is, and is legally yours to sell. If you have opted to do a realtor-free FSBO-style (for sale by owner) transaction this is definitely the time to call on an attorney. You can assist with the preparations by requesting a "pay-off statement" from your mortgage holder. In most cases you can have the information sent directly to your attorney or to the settlement agent handling your closing. Then you wait. Your attorney should be able to complete the seller's side of the transaction in a few hours of billable time spread out over a week or two. The buyer's side may take longer to prepare, and hinges on their lender.

You'll be surprised at how easy it is to sell your house. Systems are already in place, professionals are handling this sort of thing every day. Realtors, lawyers and lenders help dozens of clients every week, and they can help you. Remember to do unto buyers as you would have them do unto you. Looking at things from their perspective will help you sell your home quickly and fairly. Be willing to make concessions. Be willing to listen to expert advice. Above all else, be ready to sell your house!

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