Whether you are relocating, down-sizing, up-sizing, or just making a change, selling your home involves a process. It is a significant financial decision. You should figure out if you can afford to sell, move, and buy a new home. How much equity do you have in your home and how much do you still owe? Can you afford to make some repairs or upgrades? You can expect to pay about 7 percent to 10 percent of the home’s sale price in closing costs, including transfer taxes, prorated property taxes, title and deed work, and real estate agent commissions. You should also consider that costs involved in your buying a new home.
If you are staying in this area, we would love to help you find your new home. If you are relocating, we can help you find a realtor in your new location.
Prepare your home for showing.
Assess the physical state of your home. Consider making needed repairs but don’t go overboard. Not all improvements add value to your home. Make sure your home is appealing to buyers. Clean, de-clutter and stage inside and increase the curb appeal of your home.
Price your home competitively.
As you consider pricing your home, talk with the realtor with an open mind. Your home’s value is usually a personally sensitive issue. The market value of your home, however, is determined by objective factors such a recent home sales and appraisals. Prospective buyers and showing agents may be deterred by an overpriced home. Overpricing your home can mean it stays on the market longer. Keep in mind that a buyer’s loan process will require an appraisal. A prospective buyer cannot get a loan based on a sales price that is more than the current appraised value.
Plan to give keys to the realtor.
The door key is critical for showing your home. Realtors prefer to enter through the front door but if you have additional building or structures that are locked, plan to include these keys so that your property can be shown to its fullest. If you have a home alarm system, consider how you will use it when your home is on the market. Be sure the realtor is aware of your alarm system.
Have your home available for agents to show.
This means you will need to keep it in order. Although most agents try to give you ample notice before showing your home, it isn’t always possible. If you need three days to get your home ready to show, you may miss a prospective buyer. You will also need a plan for being away from your home during a showing. Pets are another consideration when your house is being shown. Decide in advance how you will protect both your pets and prospective buyers.
Please store valuables and weapons safely away.
Locate important papers
Having the deed, plat or survey, POA, will or LLC paperwork for the realtor will help keep the process moving.
Consider where you will live next.
Will you purchase a new home or rent one? If you will need a home loan for your next home, get preapproved for a mortgage. That way you’ll know what you can afford. You should plan ahead to avoid having to move several times. We will gladly help you find your next home!
Complete paperwork
There are several documents for you to sign when you list your home for sale.
- RECAD – Real Estate Brokerage Services Disclosure
Alabama Law requires you, the consumer, to be informed about the types of services which real estate licensees may perform. The purpose of this disclosure is to give you a summary of these services. - Exclusive Right to Sell Listing Agreement
This contract establishes the beginning and end date of the agreement as well as the sales price. The seller agrees that the real estate agent has the sole right to sell the specified property and receive a commission for finding a buyer. - Limited Consensual Dual Agency
Limited consensual dual agency is an agency relationship where the real estate brokerage company represents both the buyer and the seller in the same real estate transaction. This rarely occurs but it is best to have it. - Disclosure for Lead-Based Paint Hazard
Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such property may present exposure to lead from lead-based paint. - Property Information Checklist and/or Residential Profile Sheet
This provides information about your house for example the age of your roof and HVAC or any problems you may have had. - Seller Net Sheet
This document gives you the seller an estimate of his net proceeds from the sale of his home.
Receive Offers
Once the listing process has been completed, the realtor will post a for sale sign in your yard and your home will be advertized on a large variety of websites including First Realty (froginc.com), Zillow, Trulia, Realtor.com and others. You will be contacted by the realtor if necessary to schedule showings. The realtor will contact you when offers come in. Approach each offer as an opportunity to negotiate. For each offer, note the proposed offer price, preapproval letter, contingencies, earnest money amount, proposed closing date and possession date. Your agent will go over everything with you to help you determine if it is a good offer. You can counter an offer or refuse it. Keep emotions in check when receiving lowball offers.
In addition to paying closing costs usually incurred by you as the seller (Termite Inspection, Deed and Title) be open to paying some or all of a buyer’s closing costs. In our market buyers often do not have cash to bring to closing. The buyer’s closing costs include settlement costs and pre-paids. Any closing costs that are paid by you as the seller would mean a reduction to your net at closing. Often paying the buyer’s closing costs is necessary in order for them to purchase the property.
Waiting Period
Once you have accepted an offer, it takes 30 – 45 or sometimes even 60 days for the buyer’s loan to be processed. A cash sale moves more quickly. The realtor will stay in touch with the buyer’s lender to be sure the process moves forward.
If the buyers have chosen to have a Home Inspection, you will need to cooperate with the realtor to schedule the inspection within the time specified in the Offer to Purchase (typically within 10 days). You should not be present for the inspection. You can expect the buyers to ask that you remedy some or all of the issues that come up from the inspection. It is up to you how much you are willing to do. This is another point for negotiation.
Appraisal
The next step for you is to cooperate with the appraisal. The appraisal is ordered by the buyer’s lender. The realtor will coordinate the date and time. Sellers are typically not at home during the appraisal. The appraisal is the property of the buyer since it is paid for by the buyer. The home must appraise for at least the full sales price in order for the buyer to get the loan. The buyer will have the option of cancelling the sales contract if the appraisal is not for at least the full sale price.
The realtor will confirm the closing date once the lender has completed underwriting the buyer’s loan. The closing agent will need the information for paying off your current mortgage including contact information and the payoff amount.
If a Wood Infestation Report is required, the termite inspection will be conducted. The realtor will schedule the inspection. Any issues that are found will be dealt with through negotiation.
Contact your utility companies and advise them that you are canceling any utilities at your address, and the new owner will schedule service to begin. Remember to set up utilities for your new address.
Closing
Before closing, you should receive a closing statement showing all of your costs and payments for closing. Look it over and discuss any questions with the realtor or closing agent. If you need to pay at closing, you must have a cashier’s check made out to the closing agent/company. The amount you need to pay will be on your closing statement.
The buyers will complete a final walk-through of the house prior to closing.
At closing you will sign documents transferring title to the buyers.
Depending on what was agreed upon in the Offer to Purchase, you will give the buyers keys at closing or at a time agreed upon later.
