Halloween has come and gone. Pumpkins, broomsticks, bones, spiders, bats, ghosts, ghouls and goblins have almost all disappeared. Huge skeletons with big teeth and eerie lights that were selling for $199 have gone back into the closet.
However, selling your home could still be scary, so here are some real estate boos and ways to avoid them:
• Listing Price BOO. Your home is on the market for two and a half weeks and no showings. Your real estate agent says your price is too high, it should be lowered from $450,000 to $350,000.
Avoidance tactic: Savvy agents should be able to accurately determine a property’s market value and price range. Before listing your home, interview two or three agents, and compare their price determinations.
• Few days before closing BOO. Just before you are ready to close the home you sold, your agent calls and says the closing will be delayed, a problem with the buyer’s loan package and final approval.
Avoidance tactic: Before negotiating the sale, obtain a “loan pre-approval letter.” In the contract, include a “loan commitment contingency”(e.g., requiring that the buyer obtain a full underwriting approval subject to appraisal).
• Seller’s net proceeds BOO. At closing, the seller expected to receive $141,000, but the cash to seller on the settlement statement was $91,000.
Avoidance tactic: Estimate your net proceeds when negotiating your sales price (determine mortgage balance, loans and liens if any). Ask your agent what closing costs to expect. Some agents will provide a net proceeds sheet. Ask your attorney to see a pre-settlement statement.
• Property possession and move-in BOO. You move into your new home. There are no appliances in the kitchen, the washer and dryer are gone, and the walls and doors are banged up. Yet, everything was OK when you did your walk-through one week before closing.
Avoidance tactic: Do the walk-through (i.e., the final buyer’s inspection) on the day of the closing. If there is any damage, missing items, or other problems, get them corrected before releasing funds, or withhold funds from the seller’s proceeds.
• Here’s one very scary buyer BOO. In some places on and off the island, the real estate market has gotten crazy. With low inventory and high demand, prices are up, sellers are seeing multiple offers, and buyers are “losing out” on their dream homes.
Avoidance tactic: One solution would be to offer full price right away. However, since every property and transaction is different, I would suggest working with your agent to come up with a custom solution.
Larry Stoller is a broker and Realtor with Real Estate Five of the Lowcountry. Larry@RealEstateFive.com, RealEstateFive.com, SunCityOpenHouses247.com