It doesn’t matter if you’ve lived in your home for 1 year or 40, selling a home brings many of the same steps and challenges for everyone. In order to help you navigate the process, I thought I would give you a quick overview of what you can expect when in comes time to sell your home.
Step 1: Finding a Realtor
Even in a seller’s market, the most important thing you will do in this process is choosing the right Realtor to represent you in the sale of your home. Not only does a Realtor have a wealth of experience in real estate, she is legally obligated to represent your best interests when you sell your home. Having someone to help you through the process can make what could be an overwhelming and stressful experience, go smoothly.
How do you go about finding a good Realtor? The best way is to ask family and friends for recommendations, especially if you know someone who has recently completed the sale of a home. Another source are websites or apps like Zillow where you can see local Realtors along with reviews from past clients. Your best strategy is to interview at least two agents before making a choice. Set up a meeting with them in your home and find out their strategy for selling your home. Do they have advice for you on how to get your home ready for the market? How many homes have they sold in the past six months? You may also want to ask them to show you a few examples of their recent listings online. Do they have good quality photographs? Do you like their property descriptions?
Pick someone you trust and who you think will look out for your best interests. You want a Realtor who will communicate with you frequently and honestly. A good Realtor won’t just tell you what you want to hear. They will be truthful & they will have a pricing and marketing strategy to review with you at that first meeting.
Step 2: Pricing your home
Pricing is an extremely important part of this process. Once you have picked a good Realtor they will review recent sales of comparable homes with you to help determine the right price for your home. Recent sales are the best guide to finding the true market value of your home and are the data that the appraiser will use in determining the value of your home for the buyer’s lender (more on that later in our list). Finding the right price is critical. Price it too high to “test the market” and savvy buyers won’t even want to take a look at your home. Trust the advice of your Realtor, but understand that pricing is your decision. Want more info on finding the right price? Check out this article I wrote on the subject.
Step 3: Getting your home ready for the market
If you haven’t done so already, it’s time to clean and stage your home for sale. Your Realtor should be able to give you advice on the most important things you need to do to get your home ready to sell. The important take away is that you want to clean, remove clutter and make sure everything in your home is in good working order. You only have one chance to make a good impression on a buyer.
While not all homes need staging, I have a stager on my team who works with sellers to reposition furniture and accessories so that properties look outstanding in online photography (where most buyers start their search). I have also written several articles on the subject of home staging. You can click on the category header to the right to get more detailed information on the subject. Just remember that the time and energy that you put into your home cleaning it and getting it ready for the market will put more money into your pocket at the closing table.
Step 4 : Putting Your Home on the Market
Once your home is clean and ready to go, you will sit with your Realtor and sign paperwork in order for your property to appear in the Multiple Listing Service (MLS). Among the documents your agent will review with you are:
1. Listing Agreement– This is the contract between you and the agent to represent you in the sale of your home.
2. Property Disclosures – You will list any known issues/past problems with the property and, if your home was built before 1978, declare if you know if any lead based paints are present.
3. Consumer & Agency Disclosures – The agent will go over your rights as a consumer and will explain how their duties to represent you in the sale of your home.
4. Home Warranty – Do you want to offer a home warranty with the sale of your home? It can be a way to attract buyers since it protects for them for 1 year after the sale in the event any mechanicals in the house stop functioning properly.
5. Showing instructions – How do you want to be notified of showings on your property?
6. Net Sheet – Once a price is established, your agent will show you what you will be able to put in your pocket at closing after taxes, mortgage balances & closing costs are paid.
Make sure you look over all the forms with your agent & ask any questions so you understand what you are signing.
Once all the paperwork is complete & your home is clean & clutter free, a photographer will come and shoot pictures of the interior & exterior. A sign will be planted in your front yard & you should receive an emailed copy of the listing to review once it is live in the MLS. Make sure you review the photos & listing information and let your Realtor know if you are not satisfied with the listing.
Step 5: Showings
Your contact info (email, text, or phone number, whichever you prefer) will be given to a showing service. When an agent has a buyer interested in seeing your home, that agent will call the showing service to request a specific day and time to visit your home. The showing service will then contact you, in whatever way you prefer, to let you know the day & time of the requested showing. You will then either approve or decline the showing. You should approve as many showings as possible. Don’t forget that you are in competition with other home sellers for the available buyers. If you decline a showing, those buyers may go to another home & decide to purchase it instead of waiting to see your home. Whenever possible, accept the showing as requested.
You will need to plan on leaving your home for all showings. This may be the hardest and most stressful part of the process for you, especially in light of the pandemic. To reduce stress, I recommend that you keep your house clean and ready to show since you never know when you will be contacted for a showing. Formulate a strategy ahead of time so you have a plan for showings. If you have pets, arrange to take them with you if you can. The good news is that with our current inventory shortage, homes that are priced well do not typically stay on the market very long.
Step 6: The offer
As soon as your Realtor gets a written purchase contract from another agent, she will get in touch with you. She will review the details of the contract including price, buyer financing, closing costs, inspection details, as well as closing and possession dates. Your Realtor should also provide you with an updated net sheet based on the offer. She will give advice on whether or not the offer is a good one and whether or not you should work up a counter offer. In the end though, remember that the final decision is yours.
In our current market, it is not unusual to get multiple offers on your home, especially if you have priced it well. Your agent will guide you in selecting the best offer. The highest priced offer may not always be the best, so make sure your Realtor walks you through all of the details before making your decision.
Once all parties have agreed to the terms of the contract and have signed all the documents, you are officially under contract.
Step 6: Inspections
The purchase contract will have a deadline for inspections. The buyers will pay inspectors to look at the exterior & interior of your home including the roof and windows, HVAC system, appliances and in some cases the presence of radon gas. They will also check the plumbing, electrical, and fireplace to make sure they are free from defects. While no home is perfect, the home inspector’s job is to point out major issues that affect the habitability of the property.
Once the buyers & their agent have identified the list of things they would like repaired, they will send your agent a Post Inspection Addendum. This document will list all the repairs they would like completed. They will also send pages from the the inspector’s report that call out the defects. Sometimes the list is short and sometimes it is long. The requests will depend on the inspector’s findings and the buyer’s wishes.
Your agent will discuss the Post Inspection Addendum with you and together you will decide what repairs are reasonable and advisable. In some cases, you will work with contractors to give estimates for the cost of the repairs. You are under no obligation to make every repair requested by the buyer. The Post Inspection Agreement is another point of negotiation between you and buyer. Keep in mind though, that any major defects that you learn about through the inspection process will have to be disclosed to all future buyers.
Hopefully, you and the buyer will be able to come to an agreement on repairs. Once that is done, it’s time to hire contractors to make any needed repairs. Your Realtor may be able to provide you with names of reliable vendors they have used in the past.
Step 7: Appraisal
If the buyer of your property is not paying cash, your home will need to be appraised by an licensed appraiser hired by the buyer’s mortgage company. This professional will make an appointment to view your home through the showing service. They will look at the exterior and interior condition of your home, so it is important that your home looks just as good for the appraiser as it did when you were still active on the market.
After the walkthrough, the appraiser will pull information on recent and comparable home sales to determine if the purchase price agreed upon in the contract is within the fair market value. Banks will not loan more money than a home is worth. The goal is for the appraiser to agree that purchase price is indeed a fair value for the home. It that happens, you are clear of the last major hurdle on the journey to sell your home.
Step 8: Pre-closing details
Once the inspections and appraisals are complete, it’s time to get ready to move. Your Realtor will work with you to set a closing date & time so you can schedule movers. You will want to leave yourself a little time after moving to clean the house and prepare it for the new owners.
The buyers will likely request a walk-through of the property right before closing to make sure that all agreed repairs have been completed and that the home is still in good condition. Once again the other agent will request the walk-through using the showing service.
Right before your closing date, your agent will receive the ALTA settlement statement from the title company (this happens once the mortgage lender has given the clear to close). The ALTA statement will list all of the costs associated with the closing and will show you how much you will receive once all of these costs are deducted from the purchase price. As soon as your agent reviews the statement for accuracy, she will send it to you.
Step 9: The closing
Compared to all of the steps that came before, the closing is typically easy. You will only need to bring your driver’s license, a mask and enough energy to sign the stack of paperwork that the closing officer will bring to the table. Once you have signed all the paperwork, it’s time to breathe a sigh of relief. You have sold your home!
A good Realtor will communicate with you through every step of the process so that you understand what is coming next. Remember that selling your home can be one of the most stressful things that you will do in your lifetime. Go easy on yourself and trust your Realtor who will make the process go as smoothly as possible.
Thinking of selling your home? Please contact me & I will put my 43+ years of experience to work for you!
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