Selling a house is a unique experience. After months of planning, you have finally decided to take the plunge. Advertisements are ready, and listings are under review. Before you publish the advertisements, it pays to know about the common mistakes that every seller can make at one point or other.
Read and identify these common mistakes When Selling House because they can potentially cost you thousands of dollars.
Do Not Assume the Cost of Selling
In Connecticut, the average seller has to pay 8%-10% of the sales price for closing costs. The median value of a house in CT is $246,800. Let’s calculate the general costs you will pay when selling this house:
Realtor commissions @ 6% = $14,808
State Conveyance Tax @0.75% (for up to $800,000) = $1,851
Local Conveyance Tax @0.25% -0.5%= $617
Attorney Fee: $2,000-$2,500
At the minimum, it will cost you
$19,276 to sell your house, and we have not yet talked about escrow charges, repairs, inspection reports, recording costs, title insurance, home warranty and capital gains taxes. Make sure to get an accurate estimate of your house price and closing costs that you will pay during the sales process. This estimate will help you negotiate better, money-saving deals.
Do not Sell Before You Find Your New Home
Are you ready to move to a new place? If not, you should wait until you are ready.
A legal battle can begin if you accept an offer, but you are waiting to buy your new residence. If that is the case, explicitly mention it in the listing. Prospective buyers should be informed that the sale of your house will be complete once you purchase your next home.
However, this action is not the best approach to selling a house.
Get pre-approved by a bank, search for new homes and be ready to rent a new place before you list your home for sale. That way, if you find a buyer, you do not have to delay the sale of your house. You also do not have to rush into buying a new house.
See Also: How to Sell My Fire Damaged House?
What About the Loan Payoff?
You must deal with existing mortgages before the house is finally sold. Mortgage companies may impose an early payment penalty. How much do you owe on your home?
Call your lender and write the figures. Calculate your equity share in the house. Will you get enough funds to cover the down payment on the next property?
Depending on your situation, it might not be a good idea to sell your house right now. It always pays to consult your lenders and a real estate expert before making a decision.
Are You Guessing the Sale Price?
You know the mortgage amount. It is also essential to know the fair market value of your house. You and your realtor must understand the local market. Where is the market headed? Did you notice any increase or decrease in the price within last few years?
Wrong numbers can literally cost you thousands. You do not want to turn away customers because of setting an unaffordable, high price. At the same time, you do not want to sell at a lower price. You need to strike a balance. Fortunately, market estimates and appraisal are available to help you out. Click here to get a free quote on your house.
Do Not Spend the Earnest Money
Real estate contracts do not mean much unless they are signed by both parties, and the title is transferred to the buyer. Accepting an offer does not mean that your house is actually sold. Prospective buyers will send you offers along with an earnest deposit. Do not spend that money.
The money is not yours unless the house is sold.
Spending this money can create serious problems for you. If the deal does not work out, the buyer will likely ask for a refund. If a refund is not given, the buyer has the right to file a lawsuit against you.
Avoid Emotional Involvement in the Process
You have been living in that place for years. It is only natural to feel attached to this residence. However, you cannot let your emotions take over you. It is time to view your house through the eyes of a 3rd person. Repair the property. Stage the rooms. Invite visitors. Negotiate like a pro and sell your house at the best price possible.
It is also essential to not create a special bond with prospective buyers. Make friends but do not allow personal opinions and judgments to create future problems.
Forgetting to Cancel Insurance and Utilities
You are moving. However, your insurance company does not know that.
You need to cancel any insurance policy or utilities available before you move out. It is easy to forget about this tip, but every bill costs you money. Why would you like to pay for utilities and insurance when you are not living in that house? Contact the company right now and ask them how much time do they need to cancel/renew your subscription. Call them a few days before you move out, and everything should be good to go.
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