5 Home Selling 🏡 Pitfalls You Need to Avoid
You've probably seen all the cliche articles and blogs with typical home selling advice, right? We're gonna dig a little deeper as I share five home selling pitfalls you should avoid in order to be a smarter home seller.
Most sellers focus on the preparation of the house, and while that's important - there's a LOT more you should be doing.
Yes, you need to declutter, improve curb appeal, and hire a professional Realtor with local market knowledge to guide you through the whole process. But selling a home is so much more than getting the property ready to hit the market.
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My goal is to help you be a smart, and therefore, less stressed home seller. So here are my 5 home selling pitfalls that you need to be aware of.
#1 - PACKING
Every home seller feels like a hoarder at some point during the packing process. People do not realize how much stuff they have jammed in linen closets, attics, and in kitchen cabinets - until they start pulling it out to pack for their move.
Don't wait until after you're under contract to do this! You already have to declutter to get your house ready to show, take it one step further and fully declutter. That means go through every cabinet and closet, get rid of the things you don't want to bring with you to the next house.
Yes, it's a lot of work, but the payoff is a huge stress reduction when it comes time to move. There are going to be so many other things to do at that time. You don't need to worry about the old towels in the back of that linen closet when your close date is looming. Another benefit is that you will be able to more thoughtfully donate or consign items of value.
#2 - FINANCING
Congratulations, you got a great offer on that perfectly prepped house! The offer comes through with the buyer's pre-qualification letter from the lender and you are confident with the home buyer's ability to be approved for the loan... But you shouldn't be.
To be a smart home seller, you have to ask questions and dig a little deeper when it comes to that lender letter that came with the offer.
Here's what you should be asking:
Has the buyer simply talked with the lender and verbally told them what their income and debts are? Or has the buyer provided the lender with actual documentation that verifies their income and overall financial picture? Tax returns, bank statements, pay stubs, etc.
Has the lender run their credit yet? If the buyer for your house sends a pre-approval letter that specifies that documentation has been provided to their lender and their credit has been run, then this piece of paper is far more valuable than the one where a buyer has just verbally provided information to the lender.
Seems obvious, right?
Not necessarily... This detail gets overlooked all the time. Sellers get excited to accept a great offer, and they don't read what that letter actually says. Do your best to stay out of the financing pitfall and insist that the buyer provide documentation to their lender prior to accepting their offer.
Now don't get me wrong, this extra step doesn't guarantee that their loan will close. There are other hurdles in the loan process, but it does provide a little more peace of mind when accepting a buyer's offer.
#3 - TITLE
Home sellers very rarely think about whether there is something wrong with the title to their property that may get in the way of a sale. The title company and the buyer's lender are going to need a title search done to make sure there are no clouds on the title.
Was there a break in the chain of title at some point?
Is there an old lien still attached to the property?
Or are there inaccuracies in the legal description?
Those are just a few examples of title pitfalls that can get in your way.
Another search that buyers typically do is an open permit search. Does your house have any open permits that you didn't know about?
If it does, the buyer will probably want those closed and that can be a long and expensive process that can delay your closing.
Want to get ahead of any title problems that may affect your sale? Meet with a trusted title company prior to selling, and have them run these searches for you. If there are any clouds on the title or open permits, you can get them taken care of prior to listing your home.
#4 - INSPECTION
Sellers say to me all the time: "There's nothing wrong with my house."
I absolutely believe them, but I also know that most sellers are not going through their house with a fine-tooth comb like an inspector does. Imperfections will be found, even in the most well-cared for homes.
You, as a smart home seller, are going to go into inspection day knowing that there is a good possibility that there will be some things that the buyer will want you to repair, and that's OK.
"But Melanie," you might say, "I have an as-is contract, so I don't have to do repairs."
These contracts are very popular in the state of Florida.
I wish that were true, but a good percentage of the time, buyers will still ask you for some repairs.
You then have to decide if you want to do the repairs that the buyer has asked for, or run the risk of the buyer canceling the contract. Thus falling headfirst into the inspection pitfall.
Every transaction is different and should be evaluated individually.
That is what your Realtor is there to help you with, but before you make an emotional decision not to do repairs, look at what the inspector found.
Are the things that they are asking to be fixed things that will be found on the next buyer's inspection?
Are they safety hazards that should be repaired simply because you are still living there?
Is there a water intrusion somewhere that needs to be stopped before any damage is done?
In many cases, it is in the best interest of all parties to do certain repairs.
Repair negotiations can be tricky, so be a smart home seller and go into it with realistic expectations.
#5 - THE APPRAISAL
Another huge pitfall to overcome in your escrow period is the appraisal. The buyer's lender needs a third party to verify that your house is actually worth what the contract price is.
As the proud owner of the home, you know why it is worth every penny that the buyer has agreed to pay. Heck, it is probably worth way more in your mind.
But the appraiser is not looking at your house in the same way you are. They are looking at the property in a very clinical way, and they have guidelines to follow.
So how can you be a smart home seller on appraisal day?
Make sure your home is show ready when the appraiser comes out.
Yes, appraisers are supposed to look past boxes and clutter, but they are human, too. It makes sense to have the house looking its best on the day that someone is going to value it.
I also ask my sellers to list the upgrades and renovations that they have done to the house along with the approximate costs.
New roof? A/C system? Make sure they're on that list.
Then I provide that list to the appraiser so they have all the information about the home that the seller would want to pass along.
Even with a perfectly clean house and all of the right information, there is no guarantee that the appraisal will come in on value. It is out of your hands, which is what makes this a scary pitfall.
Remember, it does take several days for the lender to get the appraisal back, so don't expect to have an answer by the next day.
If the value does come in lower than expected, your real estate agent should be able to advise you on the best course of action.
Hope you found this information helpful and wish you the best as you make your way over all of these home selling pitfalls!
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Melanie is a Tampa Bay area Realtor with Smith & Associates. She loves Tampa Bay area area, houses, and helping clients buy and sell real estate. She can be reached at 813-368-6084 or email@example.com
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