Selling a Home
Whether you have been through the process of selling a home before, or this is your first home sale, there are many moving parts and changing paperwork involved. The good news is I am here to handle all of that for you. This guide will walk you through some of the more critical steps in the home selling process, and it is my hope this helps you understand expectations from everyone involved.
One of the most important things to remember when selling a home is that all contracts and agreements in Texas work under the instruction that "time is of the essence." Time is of the essence means there are deadlines throughout the home selling and buying process. Once you receive a contract on your home, we must work diligently to meet those deadlines as soon as possible and not wait until the actual deadline to comply.
These are essential steps throughout the process, but the home selling process is different for each person. If there are other circumstances with your home and transaction, I will communicate that to you, and we will work through them together. This guide helps you through the process and anticipates most – but not all – Seller needs.
Determine When or If To Sell
Market conditions are continually fluctuating, and some areas see higher sales than others. In some situations, it may not make sense to sell. I will pull a market analysis specifically for your home and discuss the findings with you. Together we will determine if the time is right for you to sell.
Prepping Your Home
The first step I would advise you to take is to get your home ready to go on the market. How your home looks to potential buyers will play a key role in getting as much for your home as possible. A cluttered home and/or unclean home will sell for less than an organized and spotless home. We sometimes stop seeing things that need addressing in our homes, but before we list, I will go through your home and point out things that will help your home show best. Addressing these issues will help get top dollar for your home.
One thing to remember is that once a Buyer sees a flaw, they will look for other defects the entire time they view your home. Eliminating these issues before listing your home is highly advisable.
Here is a list of recommended steps to get your home ready to go on the market:
• Clean, Clean, Clean
o If practical, hire a professional cleaning company to do a deep clean
o Every area of your home should be spotless and should sparkle
o Make sure windows are clean
o Clean ceiling fans and light fixtures
o Clean baseboards and the floor adjacent to baseboards
o Clean carpets and rugs
o Clean mirrors in bathrooms
o Clean artwork on the walls
o Clean the oven and cooktop
o Clean cabinet exteriors
o Organize your pantry and closets
o Keep your home show-ready. Have a bag or bin to store items when you have a showing.
o Put your best foot forward for every showing
• Touch up
o Repaint any marks on the walls that remain after cleaning
o Caulk any separations in the baseboards
o Repaint any marks on the baseboards that remain after cleaning
o Touchup exterior caulking
o Touchup exterior paint
• Declutter
o Remove most things from kitchen countertops
o Remove any photos – Buyers see you in the home instead of themselves
o Keep décor items to a minimum
o Rearrange or remove furniture to make your room look more spacious
• Lighten Up
o Open all blinds and window treatments
o Turn on all lights in the home for showings
o Take any other steps you can to brighten the interior
• Repair
o Repair any appliances or systems that are not functioning properly
o Oil squeaky hinges
o Replace missing or broken switch plates and outlet covers
o Replace all burned-out light bulbs
• Maximize Curb Appeal
o An excellent first impression is crucial
o Mow the lawn
o Plant fresh flowers and plants in the yard
o Trim trees away from home for better visibility
o Power wash concrete or siding if necessary
o Clean your front door and porch
o Add a bright and inviting welcome mat
• Remove Valuables
o Lock away any cash, jewelry, medicine, or other valuables
• Update The Home
o In some cases, changing paint colors or other minor changes could result in a considerable profit
o Check with me for current design trends
• Remove Items You Intend To Keep
o Anything attached to the home is to convey to your home's Buyer. It is highly advised to remove and replace these items before listing to avoid issues.
o Remove window treatments you intend to keep
o Remove and replace any light fixtures you intend to keep
o Remove any speakers you intend to keep
o TV wall mounts stay with the home, but not the actual TV
Share Your Details With Me
You should disclose to me any circumstances that may affect performance under the contract, such as:
• Are you single? Divorced? Pending Marriage? Pending Divorce?
• Is there a marital decree
• Are there any court judgments against you?
• Any bankruptcies?
• Are you awaiting probate on the home?
• Even after a divorce is final or a judgment has been lifted, there is a 30-day appeal period.
• Any judgments for alimony, child support, or unpaid taxes.
All information shared with me will be kept confidential, and it may be information that is essential for me to ensure we live up to our deadlines under any contract.
Pricing Your Home
I will pull a detailed analysis of homes in your area currently for sale and sold in the last year. My analysis will show homes +/- 10% of your home's square footage with similar finish and features as a general rule. While neighborhoods play a key role in pricing a home, and it is best to stick to sales within your neighborhood, some circumstances dictate a radius approach for similar homes.
My goal is to get you as much money as possible for the sale of your home. We will discuss my comparative analysis and pricing recommendation and determine the best pricing for you and your home.
Marketing Your Home
When you list your home with me, there are numerous ways in which I market it to potential buyers.
Property Photos – I hire a professional photographer to take high-quality images of your home and all its best features to make the best first impression online.
Detailed Property Information – I will create a detailed description of your home and note every feature in searchable fields to help Buyers find your home.
Sign – The first thing you will notice is my sign in front of your home letting all your neighbors and passersby know your home is available. Neighbors sometimes bring the best buyers by mentioning the listing to their friends that want to live in the area.
MLS Notifications – When your listing goes live in our MLS, other agents and buyers will receive notification your home is available if it meets their current search criteria.
Video Tours – I film each of my listings so buyers can conduct a virtual walkthrough of your home before seeing it in person. This helps buyers know if your home is right for them before they arrive in person and video tours bring more attention to listings.
Floorplans – Each of my listings come with a 2-D floorplan of the home, so potential buyers see the layout online. This is another detail that brings more attention online.
Social Media Ads – I routinely run ads for my listings on Google, Facebook, and Instagram to market your home to the widest possible audience.
Open Houses – Open Houses tend to draw attention to the home from passersby, buyers that have yet to see the home, and neighbors. These are all vital groups of people you want to see your home. I conduct open houses on a case by case basis depending on each clients desire.
Property Website – Each listing receives its own website and URL. This is yet another way to differentiate your home from others in the market.
Networking Groups – I belong to several networking groups and use them to showcase my listings to the connections I make. Word of mouth is a proven technique to sell a home, and I seek as many opportunities to talk about your home as I can.
Print and Online Ads – In addition to the social media ads, I also have access to ads on the local sites of Dallas Business Journal, Wall Street Journal, Park Cities People, Preston Hollow People, among others.
Showings
When your home goes on the market, I will use a third-party showing service to schedule showings of your home. There will be several options on how you receive showing notifications, and we will discuss each one.
While you have the option to decline a showing, it would be best if you accepted each showing. Denying a showing for a home on the market sets the wrong tone for Buyers and Buyers Agents.
Turn on all lights in the home for showings, and put everything away. This is your home’s time to shine, and taking a few minutes to straighten up for each showing can make all the difference.
Seller's Disclosure Notice
All homes listed for sale require a completed Seller's Disclosure Notice where you notify potential Buyers of known issues with the home. DISCLOSE EVERYTHING. It is better to notify potential Buyers ahead of time than it is for them to find out about an issue during the inspection process – or even worse, after they purchase the home.
I will send you the Seller’s Disclosure Notice before we list your home. It is important to return this completed form to me in a timely manner. Any offer we receive from a Buyer that does not include a signed Seller’s Disclosure Notice from you will grant them an additional seven days from the date they receive the notice in which they can terminate the contract and receive a refund of their Earnest Money.
Public Improvement District
Some homes are located in Public Improvement Districts, which requires a title transfer tax for both the Buyer and Seller of the home. Please verify if the property is located in a Public Improvement District or any public/municipal utility district. This information must be included on the Seller’s Disclosure Notice. There are 12 PIDs in Dallas, with Uptown and Oak Lawn being the largest.
Our Communication
I will keep you updated on any market changes while your home is on the market and provide you feedback from showings and open houses. I will also be honest with you if market conditions point to a price reduction. It is not always what you want to hear, but I pledge to be honest and upfront with you at all times.
Communication With Buyer
You and the Buyer do not communicate via phone, fax, email, letter, etc. All communications should be through me.
Title Company
In Texas, we conduct real estate transactions at Title Companies. The Title Company used in the transaction is negotiable but usually dictated by the Seller’s Agent. If you have a preferred Title Company, please let me know your preference, and I will add them as the preferred company on your listing. Otherwise, I will use someone I know and trust with your transaction.
Title companies issue an insurance policy to the Buyer on the home title and will look for any liens on the home or broken title history that could call your current title claim into question. It is essential to fill out the Seller’s Information Sheet you receive from the Title Company as soon as you receive it since it will expedite the closing and have any issues resolved before closing.
Negotiating an Offer
Once we receive an offer for your home, there are several ways in which you can respond. You can accept the offer, counter the offer with different pricing and/or other details, refuse the offer without countering, and simply ignore the offer.
I strongly advise you to respond quickly to each offer in the spirit of cooperation. Refusing or ignoring the offer may be options, but they do not convey the willingness to negotiate you should have while your home is for sale. If an offer comes in unacceptably low, I advise countering the offer at the very least.
Try to remember to be patient during this process. There may be several rounds of offers and counter-offers before you and the Buyer agree on a price. This is part of the process at times and should not discourage you.
If an offer arrives with contingencies, I will discuss them with you to decide how to proceed. We must be careful about contingencies as they can cause issues. Some examples of contingencies are the sale of another home before the Buyer can buy your home, Appraisal contingencies, etc.
Pre-Approval and Cash Buyers
Buyers that are financing your home's purchase should provide a pre-approval letter from their Lender. I advise against considering any offers that include financing without an accompanying pre-approval letter. I will check with the Buyer’s Lender throughout the transaction to ensure things are progressing as they should.
Buyers that are paying cash for your home should provide proof of funds in writing along with the offer. I advise against considering any cash offers that do not include verifiable proof of funds.
Non-Real Estate Items
In Texas, and on the Texas Real Estate Contract, the refrigerator and washer and dryer are NOT considered "real property" (as are TV screens, pool tables, surround sound, and any hung mirrors (usually in the bathroom)). They are excluded from the contract, and you are allowed to take those appliances with you after the sale closes. Some Buyers may be interested in negotiating these items into the contract/deal. Remember, everything is for sale at the right price, which could be your chance to upgrade.
Anything other than refrigerator and washer and dryer will be kicked out of a contract by a Buyers Lender, and any items they wish to purchase with the home must be negotiated with you, out of the contract, and off of the closing statement.
Execution of Contract
Once the offer is agreed upon by you and the Buyer, the contract moves to "executed" status, meaning the contract takes effect that day. All deadlines in the contract start at this execution date, and we must do everything we can to meet or beat these deadlines. I advise completing the tasks much sooner than any of the deadlines to ensure your compliance under the contract and allow ample time for any negotiations that may occur with any contract amendments or addendum.
Earnest Money and Option Fee
Once a contract is executed, two fees will be due within three days of the contract's execution date. Those are Earnest Money and the Option Fee, which are explained below.
Upon your acceptance of an offer, the Buyer will write a check to the Title Company for the Earnest Money. The Earnest Money's primary reason is to let you know that the Buyer "earnestly" intends to purchase the property. The amount of Earnest Money varies from purchase to purchase, depending on various factors. If a property generates a lot of interest, a Buyer may make a larger Earnest Money deposit to convince the Seller that their offer is stronger than the others. During "hot" markets, deposits are generally larger than during slow markets. In Dallas, Sellers should usually expect at least 1% of the total offer price. A $200,000 offer would merit a $2,000 earnest money check. The Title Company will cash the Earnest Money check and keep it in escrow. If the Buyer chooses to terminate the contract during the Option Period, the Earnest Money will be refunded to them less any expenses incurred from the Title Company, i.e., the cost of a property survey (if already ordered). If the Buyer elects to terminate the contract after the Option Period has passed, you retain the right to keep the money, plus any specific damages incurred.
Upon accepting an offer, the Buyer will also write a check to you for the Unrestricted Right to Terminate, or Option Period. Current residential contracts promulgated by the Texas Real Estate Commission offer the choice of an Option Period, under Paragraph 23. During this period, the length of which is negotiable, the Buyer has the right to inspect the property and has an absolute right to terminate the offer/contract for any reason, without penalty (other than losing their Option Fee). In exchange for this Option Period, the Buyer pays an Option Fee to the Seller. This fee must be delivered to the Listing Agent or the Seller within 72 hours of the contract's execution. If this is not delivered within the first three days of the contract, the Buyer forfeits their Option Period and can no longer terminate the contract and receive a refund of their Earnest Money.
The Option Fee is typically credited back to the Buyer at closing if they decide to continue with the property's purchase. If the Buyer chooses to terminate the contract, the Option Fee is not refundable. Typical Option Periods are from 5 to 10 days long.
Home Inspection
Buyers will have a professional inspector come to your home during the option period. The inspection typically takes 4 hours, and the inspector will test every system in your home. Items found during the inspection will likely result in an amendment to the contract asking for their repair. Repair requests are negotiable, and we will discuss this upon receipt. At times, Buyers will ask for a price credit on the home in place of repairs, which is also negotiable.
If practical, I advise having a preemptive inspection of your home before going to market. This will let you know about any issues you may not have been aware of and allow you to address them before listing the home.
Any agreed-upon repairs in an amendment to the contract must be conducted by a licensed professional, and receipts must be provided to the Buyer.
Appraisal
If the Buyer is using a Third Party for financing (Lender), the Lender will require them to have an appraisal of the property to meet the Lender's guidelines. Please remember that a "fair market value" is not the same as the "Lender’s Appraiser’s determination of value”. It is also important to remember that the Lender has hired an Appraiser to protect their interest in the property. Sometimes, an appraisal may come back 10-20% lower than the actual market value. Please also remember: Zillow and the Dallas Central Appraisal District’s value is not reflective of current market conditions nor fair market value.
If the home does not appraise at, or greater than, the sales price listed in the contract, the Buyer has an “out” of the contract and may terminate the contract due to the property not qualifying for the loan if obtaining financing through a third party financer. If the Buyer elects to move forward with the contract, they will likely negotiate a lower sales price with you, or they may be required to put forth the difference in the sales price and appraised price from their own funds if no agreement can be reached between you and the Buyer. Most Buyers Agents will advise against this second option.
The amount of down payment the Buyer is paying can be a factor in this situation. If the Buyer is putting 20% down on the purchase and the appraisal comes in 10% less than the sale price, the amount financed by the Buyer will still meet the appraised price, and the loan will proceed. If the Buyer is putting 5% down in that same scenario, a 5% difference would need to be satisfied for the loan to proceed.
If the Buyer is paying cash for the home, they are unlikely to order an appraisal of the property.
Condominium Sales
If you are selling a condominium property, there will be documents required from your Home Owners Association. Once we enter into a contract, the documents will be delivered to the Title Company and the Buyer and the Buyer’s Lender if they are financing. The contract will specify timeframes in which these documents must be delivered. You will be charged the fees for ordering these documents, and there are occasions where a rush charge will be required to meet our contractual deadline.
Finance Changes
If a Buyer changes financing options during the contract, you are not obligated to amend the contract in any form to meet your Buyer's needs or requests. Example: A Buyer can change from a cash transaction to a loan, but the Seller is not required to agree. A Buyer may change from a convention loan to a VA or FHA loan, but the Seller is not obligated to agree. If the contract does not close with the terms originally agreed upon, the Buyer will be in default of the contract, and you are entitled to Earnest Money.
Settlement Statement
When the Buyers loan approval is finalized with their Lender, the Title Company will send you a Settlement Statement that will detail the charges and credits you will see at closing. As of Oct. 4, 2015, the federal lending laws changed, and I can no longer receive the settlement statement without your permission. You must sign a form at/for the Title Company if you would like me to review the settlement statement.
Final Walkthrough
Buyers will make a final walkthrough of your home on the day of or day before your closing. The final walkthrough ensures any repairs they requested have been completed and confirm the home is in the same condition as when the Buyers signed the contract. It is essential to keep the home in the same state or better from the beginning of the contract to closing. Do not stop running sprinkler systems, discontinue pool maintenance prematurely, etc.
Closing
All of your belongings are to be out of the home on the day of closing. The Buyer will also expect the home to be clean and in a “broom swept” condition. Occasionally a Buyer’s offer will request the home professionally cleaned before closing.
I will accompany you to the Title Company on the day of closing. Please prepare to be on time for your closing to avoid delays. Please bring all keys to the home with you to the Title Company, or bring one set and leave all the others at the home for the Buyers.
The Buyer will officially take possession of the home once the Title Company receives the funds from them or their Lender. The Buyer will receive their keys from the Title Company once this occurs. It is possible but unlikely that you would not receive these funds the same day as the Title Company. If this happens, please inform me.
Remote Closing
If you are not going to be in town for the closing documents' actual signing, please make me and Title Company aware of this two weeks before the close date. The Title Company can make arrangements for a mail-out closing and arrange a notary to meet you in the city you will be in that day (if you are in a foreign country, you will need to report to the U.S. Embassy). Once the documents are signed, you will overnight the original documents back to Dallas. There may be a cost involved for the notary service, although most will cover the expense. Most Title companies will provide a shipping label as well.
ASK ME FOR ANY ADDITIONAL INFORMATION OR QUESTIONS YOU MAY HAVE CONCERNING THE HOME SELLING PROCESS.
