Selling your home is a large undertaking that's time intensive and can have major ramifications. There's more to selling a house than putting a "for sale by owner" sign in your yard. The value of your time should be balanced against what you'll save by not paying an agent's commission. You have to be willing to aggressively promote your property or it may sit on the market, and insufficient exposure usually results in a lower sale price. Study the local real estate market to properly assess values, and practice negotiation skills.
Role of an Agent
Do you need to hire an agent? There are downfalls to a "for sale by owner" sale, such as legal traps, sale failures, lawsuits, and wary purchasers leery of dealing with non-agents. To find agents, go to Realtor.com, the official site of the National Association of Realtors®, the "Find a Realtor" tab.
Listing your Home
There are several listing options available. For "sale by owner" candidates, you can consider an open listing, or non-exclusive listing that lets you sell your own home. Other listings like exclusive agency listings and exclusive right to sell listings are applicable to agent situations.
How do you set the sales price? Use comparable information from recent home sales in your area, real estate appraisals, area market and economic data, and pricing and sales trends. Your listing should include highly descriptive phrases, attractive professional-quality pictures, video tours, and emphasis of noteworthy attributes.
It is imperative to have an adequate seller's disclosure. It tells purchasers about conditions that might interfere with a decision to buy the home before the sale is achieved. The written statement is made by the seller, signed by the parties, and depicts pre-existing faults and other information about the house. There are weighty consequences in failing to sufficiently disclose defects. A frustrated purchaser may try to invalidate the sale or seek money damages for loss or repairs.
The Maryland Department of Labor, Licensing and Regulation offers an official Seller's Property Disclosure Statement form.
Getting an Offer
The buyer presents an initial offer to the selling party, often for a lower price than the asking price. It also may contain terms of sale such as the closing date, contingency conditions or deadlines, inspection waivers, or personal property desired. A counteroffer is the seller's response to the offer, generally accepting the offer subject to conditions. There is no limit to how many counteroffers can be negotiated. The offer is reduced to writing in the purchase agreement.
After an offer is accepted, the parties enter into a contract and must complete the terms of the contract to proceed to closing.
The Purchase Agreement
The Purchase Agreement is a legally binding contract that includes the purchase price, settlement dates, what is included in the sale, agency disclosure, details of possession, due diligence, marketable title, final walk-through, and warranty issues.
If a home inspection reveals property defects, there are negotiation options to salvage the sale, such as an allowance provided by the seller to the purchaser to repair defects; the seller can fix defects; or the sales price can be reduced.
The closing is the last stage in the process. It's a meeting where the parties and their lawyers or agents finalize the sale. Purchasers sign promissory notes and mortgages, and obtain funds from lenders. They pay sellers the purchase price, and sellers give them documents to transfer good title in return, including deeds to transfer title to the purchasers.
The seller provides the keys at the closing or soon afterwards. The seller need not attend the closing and rarely does.
Laws governing real estate vary by state. Maryland sellers should consult a real estate attorney to safeguard their interests.
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