Mistakes a Seller Can Make

When a homeowner makes the decision to sell their home, there are many factors to consider and some mistakes to avoid.  What price should I ask?  Should I use a Realtor?  Should I go ahead and replace that old carpeting in the den?  There are many questions with many different answers.  The following are some of the mistakes that many sellers make and insist on going ahead with unproven and unwise selling strategies, instead of listening to the sound advice of an experienced real estate professional. I have listed 7 important items that every seller should consider:

1 The proper presentation of the house is everything, so any work that has not been completed in the house, needs to be finished and completed before starting the marketing process.  This includes any painting that has been started, or wallpapering, any remodeling, etc.
 
2 Do not over improve the house with anything that will ‘stand out’ as being over improved for the neighborhood.  Don’t add on rooms or upgrades that will be an obvious over improvement for the area.  Your Realtor is aware of the current ‘sold’ prices in the neighborhood and can help with this.

3 Hire a Realtor or real estate professional who has a proven tract record of getting homes sold and one who knows the community and especially the neighborhood.  Then listen to what they are advising you as far as a marketing plan.

4 Price the home based on the market, not what you want to net out of the deal.  A seller can control the asking price, but only the market controls the actually selling price.  Your Realtor can help with this as they are very familiar with what is being sold in the neighborhood, what the houses are appraising for, etc.

5 Once you decide to sell your house, it’s no longer a home, but a commodity.  Don’t get involved emotionally in the sale of your house.  It needs to be prepared as a commodity, marketed as a commodity, and priced as a commodity.

6 Get all of your ducks lined up when you’re ready to sell.  This involves financing, and knowing what your current loan fine print say about assumption, any pre-payment penalties, etc.  Also know what the market is doing, the current neighborhood appraised values, etc.  Your real estate professional can help with much of this. 

7 Do not cover up any existing problems with the house, and be ready to disclose any known problems. Just because you disclaim doesn’t mean you cannot be sued later for the leaky basement, or dilapidated heating/air system that’s discovered 30 days after settlement.  Again, your Realtor can help advise you on this.

Tweet

Buyers, Get an Edge on everyone Else

The spring and summer months are traditionally the busiest times of year for the residential real estate market. Weather is more cooperative and many families like to move while the kids are on their summer vacation.

If you’re going to be looking for a new home this spring, its time to get started.

If you’re going to work with a Realtor or Real Estate Professional, get started early. Let them know exactly what you are looking for.

• Get your loan pre-approved. This will give an advantage on several fronts.
• Figure out how much you have for a down payment.
• Be ready at a moment’s notice. If you’re in an especially tight market, your Realtor will be reviewing new listings daily. If he or she finds something that matches your criteria, you’ll want to look at the house and be ready to make an offer, fast.
• When looking at houses, look at the potential. There are major factors you won’t be able to change — the neighborhood, proximity to work and schools, the basic floor plan of the house, and size of the back yard, among other things.
• If you’re buying in a seller’s market, listen carefully to your Realtor or agent about how much you should offer.

Begin thinking about homeowners’ insurance now. Begin by making sure your credit report is accurate — credit histories are sometimes used to determine whether a company will insure you, and, if so, at what rate.

Tweet

Zero Down Payment Financing program

Effective today, April 1, 2010, and good for a limited time only, FHA has announced a new pilot Zero Down Payment Financing program available to self-employed individuals with credit mid-scores of at least 350.
Based on the huge success of the former NINA (No Income, No Assets) loans and other ‘Alt A’ “No Documentation” loan programs which led the housing boom of 2005-2007, the loans will be available for homes which appraise for at least 80% of list price, regardless of condition.

HUD spokesman Noe Jose said, “The program is a trial effort to find a replacement for the hugely successful Tax Credits for Home Buyers which expire April 30. Those Tax Credits are widely acknowledged as boosting home sales during a period of economic uncertainty.”

Tweet

Time To Buy Real Estate

Fed is ending its 16month program of buying Mortgage-Backed-Securities (MBS). They have been buying these MBS’s for a while now thus causing the lower rates that we have come to love and expect.

Rates will have to go up to make the investment more attractive to the fewer major buyers that remain in the market.  Before the Fed stepped in, rates averaged 5.75% to 6.25% for much of 2008. So it is likely that we should see rates rise to that level again.  More than likely, we’ll see the market move back towards those levels.  My best professional opinion says by the end of this year for sure and probably by the summer.   I can’t stress enough … the historic lows are over … if you need to refi or do a purchase … now is your best time.

If you paid attention last week, you would know that MBS pricing collapsed on Wednesday & Thursday, which has already led to rate increases on many programs.  Investors are nervous about the Fed backing off, and the cost of the new health care bill signed into law today.   Remember, rates always rise like a rocket (fast) and fall like a feather (slow).  Won’t take too much to push them upwards – very fragile market.

Tweet

Closing costs

I am asked all the time, from both buyers and sellers, about who is responsible for the ‘closing costs.’   Closing Costs are the fees that are associated with buying or selling a home or any real estate property, and certain fees are automatically assigned to either the buyer or to the seller, and other fees, or costs, can be negotiated.

**For the Buyer:
The mortgage loan costs and fees charged by the lender, the down payment, any loan fees, any prepaid interest, home inspection fees, the appraisal costs, mortgage insurance, hazard insurance, title insurance, and the documentary stamp on the note.

**For the Seller:
The seller has to pay off any loan amount due on the property when the sale closes, along with any other fees due, prior to the seller getting his profit from the sale. The other typical Sellers responsibilities are the transfer taxes, brokers commissions, documentary stamps on the Deed, title insurance, any prorated property taxes.

*Negotiated Costs:
Sometimes some of the closing costs are negotiated between the seller and buyer, so nothing is ever really cut in concrete on closing costs.

*Prorated Costs:
Some closing costs are shared between the seller and buyer, and they will be prorated.  An example of this is the property taxes.

Tweet

« Previous Page