SELLING YOUR HOME PART 1

Before You Put Your Home Up For Sale 
Once you’ve made the decision to sell your home, there are a few things to do before you put your home on the market. Putting a home “on the market” means that you’ve officially put your house up for sale. At that point buyers and Realtors expect to be able to walk through and view the home. Following are a few tips to best prepare your home and yourself for the process.
1. Honestly evaluate what needs to be done.
Perhaps at no other time is the saying “First impressions count” more true than when a potential buyer walks into a home for sale. From the moment a buyer pulls up to your house – before they even get out of the car – he or she has begun making mental notes about the condition of the home. You significantly increase the chances, and the speed with which, you sell your home if you take an objective look at the condition of your home – inside and out – and decide what you’re willing to do before putting your home on the market. Try imagining that you are a potential buyer and walk around your property, and through the interior, to make mental notes of what could be repaired, cleaned or improved. Anything that you notice the buyer is bound to notice as well.
2. Decide, Do or Delegate
Once you’ve listed everything that needs to be done to your home before selling, split the list into three categories:

• “Things I Will Do”
• “Things I Will Hire Someone to Do”
• “Things I Don’t Want to Do and Will Negotiate With the Seller”

Just because you know that something ought to be done to the house before putting it on the market, doesn’t mean that you personally have to do it. Consider hiring someone to do a few things to the house. For example hire a professional to steam clean the carpets or repair drywall. Or, you might decide that you’re not willing to either do it yourself or hire someone else. In that case you should be willing to negotiate with the potential buyers. For example, you could reduce the asking price to compensate for the extra work that the new owners will face, or create some sort of “allowance” to offset the cost, such as a carpet allowance if you don’t want to re-carpet the house but you know that realistically it really does need replacing.
3. Clean and de-clutter
Now it’s time to clean. A clean house makes a huge impression on new buyers. To make the cleaning easier, start by de-cluttering. Think about de-cluttering as your first stage of packing. De-cluttering means getting rid of (either boxing up and storing or throwing out) all the small knick-knacks, decorations and everyday clutter lying around your house. For example, put away paperwork, photos, collections, take the coupons and magnets off the refrigerator, clear off as much tabletop and countertop space as possible. Be ruthless. If possible rent a storage unit to store your boxed up “clutter” including extra furniture. The goal is to make rooms look as big and open as possible.
As proud as you are of your personal possessions and family mementos, you want for a potential buyer to be able to see him/herself in the home. So take down little Susie’s entire art portfolio from kindergarten and your entire wall of family vacation photo collages. Think neutral. Think model home. You want it to be clean, spacious and inviting, but also a place where your buyer could envision his or her furniture, pictures and collectibles.
Once you’ve de-cluttered, clean like you’ve never cleaned before. You want it to sparkle, shine, and positively scream “buy me!” Now is a great time to splurge and consider getting a cleaning service. You want walls scrubbed, curtains laundered, windows washed, and floors waxed. Clean up the yard, mow, pick up sticks, trim bushes and clear walkways. Make as many small repairs as possible such as cleaning or re-grouting caulking in tubs and around windows, replacing light bulbs, and touch-up painting.
How Are You Going to Sell Your Home?
After deciding to sell your home, the next biggest decision you’ll face is how to sell your home, specifically whether you’ll choose to use a Realtor or sell your home on your own.
Using a Realtor
First let’s consider using a Realtor.
How do you find a Realtor? You can find an agent through:

• Your area’s local Realtor association
• In the phone book under “Realtors”
• By word of mouth or referrals

Just as when buying a home through a Realtor you should interview a potential agent before signing any contract. Click here for a list of questions to ask a potential real estate agent.
Once you’ve decided to use an agent, he or she will typically ask you to sign a document saying that he/she has the exclusive right to list and sell your property. Why? Because agents make their money from their commission, the money they make only once your house sells. If you list your home with multiple agents, then he/she will be doing a lot of work to market and sell your home only to find out that someone else has made the final sale and collected the commission!
There are three types of contracts:
1) Exclusive right to sell. Agent is the only one with your authority to list and sell the home.
2) Exclusive agency. You won’t pay the agent if you actually end up finding the buyer. You pay the agent only if he/she brings you a buyer
3) Open. You are willing to pay commission to any agent who brings the buyer.
More than likely your Realtor will want you to give them an “exclusive right to sell” your property in the contract. The things you want to make sure you understand before signing a contract with a Realtor are:

• Length of contract. How long are you agreeing to use the agent? Is the contract automatically extended?
• Commission. Typical commission is six percent of the homes’ sales price, but you may be able to negotiate that lower.
• Services. What type of services will the realtor provide, i.e. advertise the property, hold open houses, negotiate contracts, assist buyer in finding financing, coordinate the closing, etc.
• Seller Permission. What permission are you giving your agent by signing the contract? For example, are you agreeing to have a lock box (a device that allows Realtors to enter your home with a potential client when you’re not home) placed on your door? A sign posted in your yard? To have your home listed on the company’s marketing pieces?
• Earnest Money Description. Who will hold the buyer’s earnest money deposit (the money the seller puts down to make a firm offer on your home and take it off the market) and when will it be paid out to you, the seller?

Selling Your Own Home
FSBO. Fizzbo. What the heck does that mean?! FSBO stands for “For Sale By Owner.” More and more homeowners are deciding to sell their homes without the help of a Realtor. In fact, nearly 1 in every 6 homeowners sell their own home without the help of a professional real estate agent. Why? Mostly to save money.
Real estate agents typically charge six percent commission, which means that if a Realtor sells a home priced at $200,000 they will pocket $12,000. If you’re willing to do some homework, a lot of legwork, and educate yourself on the process, selling your own home might be the right choice for you.
When you choose to sell your home yourself, you will be responsible for managing all of the details usually taken care of by an agent, including:

• Pricing the home
• Advertising the home
• Showing the home (by appointment and holding open houses)
• Drawing up a contract
• Negotiating a contract
• Finding a settlement attorney or closing company to handle the closing
• Scheduling appraisals, termite inspection, home inspection

Professionals for Hire…Part-time
If you choose to sell your home yourself it doesn’t mean you have to go it alone. There are professionals that you can hire for a flat fee or part-time to help you with various aspects of the homeselling process. For example, for a flat fee you can often hire:

• A Realtor…to give you comparables (a list of recent home sales in your area, comparable properties to give you an idea of how much you should list your home for), to write up a contract for you and your buyer, or to list you on the Multiple Listing System (MLS)
• A real estate attorney…to draw up a contract or review offers
• An escrow or title company…to hold an earnest money deposit from your buyer, prepare documents, and handle the official closing (when you and the seller officially complete the sale of the home and transfer ownership)

When you hire someone, be sure to read contracts carefully and make sure that you specify exact work you want him/her to do and for an agreed-upon fee. For example, if you hire a Realtor to draw up a contract for you and a buyer make sure that you don’t sign a contract with him/her agreeing to use them as your selling representative…or they get to collect that commission!
FSBO and Working with Realtors
Be prepared – if you decide to sell your own home you will (1) get a lot of phone calls and mail from local Realtors trying to convince you to sign with them to sell your home and (2) you may find that Realtors are reluctant to show your home to their clients.
Why would Realtors not want to show your home to his/her client? It all comes down to the Realtor’s commission. Realtors typically make a six percent commission. The commission is paid by you (the homeseller) and by the home buyer – each paying three percent. Realtors know that without using an agent, you want to save the money you would normally have to pay for commission.
If you decide to work with a buyer who has an agent, you can tell him/her to add three percent to the home sales price. In essence you’re telling the buyer that he/she is going to have to pay his/her own Realtors’ entire commission.
Homework
While you’re still at the beginning of the home-selling process:
1. Walk through your home (inside and out) and make a list of things that you think need to be fixed or replaced before you put your home up for sale.
2. Begin to think through whether or not you’d like to use an agent or if you’d like to try to sell your home on your own. If you know someone who has moved recently ask them about their home-selling experience and what they would recommend.
3. Begin to look for a moving company (unless you’re going to move yourself) and local storage companies if you think you’ll need to store some of your belongings before you move. Get estimates or bids IN WRITING.