How to Sell Your House in a Under a Week
Part 1: Home Improvements
Part 2: Clean Up
Part 3: Staging Your Home
Part 4: Listing for Sale
Part 5: Show and Sell
Please note, I’m not a real estate agent, nor do I play one on TV. This advice is strictly from my experience. My experience was tremendous, and it just happened last week. Not during the big real estate boom of 5 years ago (or whenever it was, exactly). This all happened in May 2013! The market does seem to be changing for the better!
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Part 6: Escrow
Once you have potential buyers making offers, you’ll need to weigh them all and determine which is the best offer. The best offer may not be the highest number. Sometimes people offer more than asking price, but then ask that seller pays closing costs, pay for appraisal, inspections or other fees. They may ask that you leave personal property behind for them, such as appliances. They may have a lot of money to put down on the house (which is usually a very solid offer), or they have little to put down (which shouldn’t rule them out as a viable offer). Figure out the bottom line for all offers, and choose the best one and a backup, if possible. You also need to try to determine if the people making the offer can actually afford the house, and can get financing (if not a cash offer). Sometimes investors will make cash offers that seem attractive, but is that the best thing? Only you can decide. In our case, we have a wonderful neighborhood with fantastic neighbors who have all lived here for years. Selling to an investor who might rent to just anyone seems wrong for this neighborhood. But then, we could choose a family to buy it and live in it, and maybe they won’t fit in the neighborhood either. Do your best, and do what’s right for your family and yourself.
We had 26 offers on our home. Several of them were very similar, and more than our asking price. It came down to what the sellers needed from us. Some were asking for closing costs which subtracted from their offer amount. Some were asking for special financing – FHA and VA are common. With FHA and VA financing, the buyer often does not have large down payment and the property will need to appraise at or above the offer price. Therefore if the offer is above asking price, it may not appraise as high as you need it to. That’s not something you want to find out halfway through escrow. You may need to renegotiate the sale price (which means you’ll lose money), or you may need to find another buyer! So, you see why choosing a solid offer is important.
Inspections, Appraisals and Reports: Additional fees for selling your house may include an appraisal (a certified appraiser comes to your house, measures and may even take pictures, then writes up an itemized list of your house’s value). Appraisals can cost somewhere between $250 – $500 or more, which may vary by location and the size of your home. The appraiser is generally chosen by the buyer’s lender. You will have no influence over the value the appraiser gives your house, except to have the house in the best condition possible.
You will probably need a home inspection. According to ASHI, the ten critical areas for inspection during the process are the structure, exterior, roofing system, plumbing system, electrical system, heating system, air conditioning system, interior, insulation and ventilation, and fireplaces. You can take a Virtual Home Inspection Tour for an interactive, step-by-step look at the ins and outs of professional home inspections ─ a great way to get acquainted with the process before you’re actually part of it! Sometimes termite and other types of inspections are also requested.
Depending on your state, what’s required in selling your home may differ. Your Realtor may order a report of your local area, and you might be asked to fill out disclosures about the condition of your home. It’s not an interrogation, just a friendly stack of papers asking about the house. Have you had any major problems, leaks, mold – stuff like that. Are your heating and a/c functioning (if your home has them), and is everything to code. For example, we installed a CO2 detector on the second floor of our house, but last year in California the code changed so one is required on both floors. We agreed to install one downstairs. Not a big deal, and it makes everyone happy.
Usually, a title company will do a title search on your home (think of the title as the deed to your home, similar to an automobile title). They’re looking for any potential issues, liens (money you owe that may have been attached to your home in the form of a lien), or other issues. The buyer may opt to have title insurance in case something comes up after a title search comes back clean.
And once everything is in place, from inspections (termites, etc.), appraisals, reports, title search, and buyers have secured their mortgage or funding, then escrow closes and you hand over the keys (and hopefully get a check!) Escrows can be anywhere from a few weeks to a month or more. When we bought our house, our escrow took almost three months because the seller was purposely taking her time. She hadn’t made payments on the house in more than six months and would have lost it, according to her bank, if we hadn’t agreed to an offer to buy it. (Note: she claims that wasn’t true, but the facts indicate otherwise. It was 10 years ago, so it really doesn’t matter anymore.)
A word about Short Sales. You may have heard the term “short sale” when looking for houses to buy. A short sale is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property. In other words, “Short Sale” has nothing to do with how long or short escrow is. Although they may request that you close more quickly if possible. Short Sale usually refers to bank-owned property that sells for less than what was owed against the property. If you are “upside down” on your home (you owe more than you can sell it for) or if you’re behind on payments, you may opt to do a short sale rather than allow your home to be foreclosed (taken back by the bank).
Believe it or not, we listed our house a week ago Tuesday. We had people looking at it within hours, had multiple offers by the following day, an open house that weekend and in total more than 250 people saw it. After the weekend we had a multitude of offers – many much higher than our asking price. We put the listing in “quiet mode” 5 days after listing and chose a buyer. We are in escrow and set to close at the end of this month. Amazing!
Tune in tomorrow for Part 7: Closing