SELLER INFORMATION
Selling
a home can also be a challenging experience. We are here to
help make this whole process easy and understandable for you.
Below are some questions you may be asking yourself, however
if you have any others do not hesitate to contact us at billmulhern@comcast.net
WHAT
IS THE FIRST THING I NEED TO DO IF I AM BUYING OR SELLING A
HOUSE?
You
may want to find a real estate agent, or broker, to help you
in either buying or selling a house. If you are a potential
buyer, you can work with any number of brokers. If you are a
seller, you generally will responsible for paying the broker's
commission, and generally list with only one broker. Although
as seller you list with one broker you'll want to make sure
the terms of your listing allow other brokers to show the house
to potential buyers. In such a case, the commission is shared
(often split) between the listing and selling brokers. If you
are buying a house, you should be aware that the brokers (even
"your broker") are almost always acting in the interests of
the seller. Sometimes you may even be asked to sign a document
indicating this.
WHAT
ARE SOME THINGS A SELLER SHOULD LOOK OUT FOR WHEN DEALING WITH
THE SALE OF A HOUSE?
The
seller should consider the following:
(1) Whether or not to use a broker, and if so, the broker's
commission.
(2) What things (fixtures, equipment, built in furniture and
the like) will be included in the sale? (3) Is there anything
that I should do in advance to "dress up" the property, from
needed repairs to a new coat of paint?
(4) What is the asking price of the house?
(5) What price are you willing to accept?
(6) Are there any defects that you must by law disclose to the
buyer?
(7) Do you have any debts or liens that may affect the sale
of your home?
IF
A BUYER MAKES AN OFFER ON A HOUSE, IS S/HE BOUND TO IT? IF A
SELLER ACCEPTS AN OFFER, CAN S/HE CHANGE HIS/HER MIND?
A buyer can withdraw an offer anytime up until the offer is
accepted by the seller. After that, the seller may owe the commission
to the broker, and may well turn around and sue the buyer for
breach of contract to recover the cost of that commission. If
the seller changes his/her mind after accepting an offer, especially
if the terms of the listing agreement have been met, s/he usually
still owes the broker a commission. This depends largely on
the wording of the listing agreement; it might be wise to state
that the commission will be paid upon completion of the sale
of the property.
WHAT
HAPPENS AFTER A BUYER AND SELLER AGREE ON A PRICE?
It
is common for the buyer and seller to complete a "binder". This
is either an outline of the proposed sales contract between
the buyer and seller or the contract itself. It includes:
(1)
the property address
(2) the names of the parties involved (the buyer and seller)
(3) the purchase price, and proposed financing
(4) what will happen if the buyer can't get a mortgage, or if
inspection reveals serious problems with the house It is most
often accompanied by a deposit from the buyer - usually $500
or 1% of the purchase price of the house. It is mostly used
as a show of good faith between parties. Depending on the wording
of the binder, it may or may not give either party the right
to sue for breach of contract, or create a forfeiture of deposit.
WHAT
ARE SOME OF THE THINGS THE SELLER SHOULD BE SURE TO PUT IN THE
CONTRACT?
The seller will want to be sure that the contract specifies
that
(1) s/he (the seller) is entitled to damages (usually the deposit)
if the buyer does not fulfill his or her end of the contract
- the amount can vary from as low as 1% to as much as 10%, generally
depending upon the location
(2) all statements made about the property by the seller are
accurate
(3) any of the buyer's contingencies - like inspections or financing
- will be taken care of in a reasonable amount of time
IF
THE INSPECTION IS NOT SATISFACTORY, CAN THE BUYER BACK OUT OF
THE DEAL?
In addition to everything else, the contract should include
an "inspection contingency clause"; that is, what happens if
the buyer's inspection does reveal problems with the property.
Small problems, like leaky faucets, loose light fixtures or
doors that don't close properly can probably be fixed easily
by the seller. More substantial problems, like a defective furnace,
a waterlogged basement, or non-compliance with building codes,
that can be structural, need more substantial repairs. Although,
depending on the terms of the contract, the buyer can often
break the deal without forfeiting his/her deposit, there may
be a statement in the contract that says that the seller will
either fix the problems, or give the buyer a discount on the
price of the house in lieu of repairs. If the house is situated
on a hillside, and is about to slide off the side of a cliff,
the buyer will most likely want to cancel the contract.
WHAT
HAPPENS AT THE "CLOSING"?
The
closing is the meeting between the buyer and the seller, at
which time all remaining documents relating to the sale are
signed. The deed to the house is transferred from the seller
to the buyer. Title insurance is paid, the mortgage papers are
signed by the buyer, and possible transfer taxes are paid to
the state. In addition, the buyer will pay the seller for any
miscellaneous expenses, such as appliances or furniture that
had been previously agreed upon, the remaining oil in the oil
tank, or any real estate taxes that the seller had prepaid.
WHAT
IF THERE ARE PROBLEMS FOUND WITH THE HOUSE AFTER THE CLOSING?
This really depends upon the type of problem you find. If you
find that the seller has walked off with some fixtures, which
should have been included with the house, you might be able
to sue to get them back, but this is a problem that might be
better found in a walk through inspection just before the closing.
Any major problem that the seller should have disclosed before
the sale would probably justify a lawsuit, while a problem like
termites, which should have been discovered in inspection, will
likely leave you no recourse but to solve it yourself. A problem
such as noisy neighbors is your problem; it is best to spend
time in the neighborhood before making an offer or signing the
contract. Don't wait until the closing to see if there will
be a problem.
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©
Copyright 2005, Bill Mulhern
