If you are thinking of selling your home anytime soon or in the near future, you must learn how the traditional selling works. Understanding how the process works will help you to reduce the number of unexpected problems and save a lot of your time when dealing with them.
Make Repairs or Home Renovations
Before listing a property with a realtor, you are required to have your house “presentable”. The minimum work would be cleaning and tidying your home including storing your furniture away while showing in the market. A lot of times your home might not be in the perfect situation for sale or necessarily bring you the highest resale value. There is also a high chance that you need to do touch-ups such as getting new paint. Hiring a staging company to furnish and decorate your house is recommended to receive more attractive offers.
In some cases, repairs are necessary to have your home listed for sale. If your house has a relatively long history comparing to other houses in your neighborhood, defects are likely to be found during home inspections. Homeowners are often asked to make repairs to normal tear and wear after living in the house for a long time. Depending on the situation of the house, larger-scale repairs may be required such as a complete redo of the kitchen. This all comes with a huge cost, but sometimes it is worth if you have the capital and time to do so.
List Your Home with a Real Estate Agent
Once you decide to sell your home, you need to find a trustworthy realtor who is familiar with your neighborhood and has experience in marketing houses in the area. Needless to say, the more time the real estate agent has spent in the area, the more likely he/she can convince the buyer to make a more decent offer. Essentially speaking, the realtor’s effort determines the success of selling your home.
Meanwhile, some of the burdens are taken off your shoulders by the real estate agent, there is a price to pay, which is the commissions. In a traditional home sale, the real estate agents’ commissions differ in each case. Typically speaking, homeowners can expect to pay around 5-6% of the home sale price. The seller is responsible to pay the commission fees for both their own listing agent and the buyer agent. And according to the National Association of Realtors, 87% of buyers purchase a home with an agent.
Get Started with Market Appraisal and Mortgage Application
Once potential buyers are interested in buying your house, they’ll give you an offer through their own real estate agent. Then, your real estate agent will present you with all the offers. If you accept it, then the buyer will submit their mortgage application unless he/she has been pre-approved.
This process can take some time where the bank or the buyer will bring an inspector and an appraiser to check on your property. This is to find if there are any additional repairs required in order to have the home financeable by the bank and assess the value of the home. Once the process is done, you are ready to move on to close the deal.
Pay the Closing Costs & Close the Deal
Other than the commissions paid to the real estate agents, closing costs cover a variety of other expenses when you are at then end of closing a deal. They include but are not limited to title insurance, property taxes, escrow fees, lender costs, homeowners insurance. For instance, the average closing costs in Washington State is estimated at around $2,254. Additionally, if you are selling your home in Washington State, you are obligated to pay a real estate excise tax at the amount of 1.78% of the selling price
The actual amount you have to pay varies according to the size of your loan and legal requirements of each state. Some costs are non-negotiable such as transfer taxes while others like lender fees are negotiable.
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