A Practical Guide to the Home Selling Process
Our goal in presenting information about the Real Estate Selling Process is to put into words our real life, day-to-day experience when we’ve assisted a Seller with getting their property sold. Note: This Guide is not intended to cover every possible situation that could be encountered in the Selling process.
The Selling Process almost always starts when we receive a call or email from a homeowner saying that they are thinking of selling their property and would like to meet with us to discuss what we think their property is worth. We set an appointment to meet them at their property so that we can gather more information and ultimately prepare an educated price opinion of their property.
How We Help
When we arrive at your property, we first like to visit with you to get some basic information. Also it is the opportune time to present the Real Estate Relationships Disclosure form, the purpose of this form is to disclose to you what real estate relationships Shore to Shore LLC offers. This is NOT a contract. It is a disclosure form required by law. We also explain what we charge for our Professional Fee, also known as real estate commission, and the benefits to listing your property with us. This fee can be thought of as a “Success Fee” because we don’t make any money until your property sells! It’s best if these items are addressed sooner rather than later! To be able to best understand your needs, we will ask the following questions:
- What is your reason for wanting to sell your property?
- How soon do you need to sell your property?
- Do you have a place to move to, or would you need to secure a place prior to the sale
of your property?
- Are there any liens on the property that would make meeting these lien obligations
difficult at the time of closing?
Now that we have answers to these important questions, we can proceed with taking the tour of your property so we can get going on preparing that price opinion, accompanied with an Estimated Seller’s Closing Statement. This Statement will give you a very close estimate of how much money you would retain once your costs/fees are deducted from the sales price by the closing company.
Things You’ll Need To Do
Once the decision is made to list your property with Shore to Shore Realty LLC, we will prepare a Listing Packet which will contain the following forms:
- Real Estate Relationships Disclosure. This form most likely has already been presented to you. The purpose of this form is to disclose to you what real estate relationships Shore to Shore Realty LLC offers. This is NOT a contract. It is a disclosure form that is required by law.
- Listing Agreement. Generally, the terms of the Listing Agreement have already been discussed at length, and the Listing Agreement is prepared accordingly. The common terms are the listing term, the brokerage commission rate, the list price, what personal property would be included in the list price and if you would need the contingency that you would need to have another property secured before closing.
- Seller’s Property Condition Disclosure Statement. This form is in most cases required to be completed by the homeowner. There are a few instances where this form is not required, one example being if the property is owned by an Estate. When a Buyer is making an offer on a residential property and the Property Condition Disclosure exists, the Buyer must review and sign/date this form prior to making an offer.
- Disclosure of Information on Lead-Based Paint and/or Lead-Based Paint Hazards. This form is required to be completed on residential properties built prior to 1978. When a Buyer is making an offer on a residential property and the Disclosure of Lead exists, the Buyer must review and sign/date this form prior to making an offer.
- Estimated Seller’s Closing Statement. This Statement will give you a very close estimate of how much money you would retain once your costs/fees are deducted from the sales price by the closing company.
Seven Great Tips
- Choose a real estate agent or REALTOR® who will take the time to review your property and prepare a list of items that should be done prior to putting your property on the market. Shore to Shore Realty does this! HINT: If you hear yourself saying, “Oh, that will be easy for the new Buyer to take care of,” this is a sure sign that you should take care of that yourself before putting it on the market!
- Choose a real estate agent or REALTOR® who is a Home Stager! This is invaluable knowledge and a free service Shore to Shore Realty offers!
- Be as flexible as possible when you are called to schedule a showing. Oftentimes, it will be short notice!
- Be patient with buyers who give lower than you expect offers. Try to adopt the mindset that it is a business deal and there is bound to be a good amount of negotiation taking place.
- If you accept an offer with financing and inspection contingencies, be flexible with the people who need to come in to your property to do inspections and the appraisal.
- If you accept an offer you can still continue to have your property shown. The benefit of this is you could secure a “backup” offer in the event the first accepted offer does not materialize.
- There is a closing date indicated in the Purchase Agreement. The closing date can change by a day or more, so tolerance of this situation is often necessary!
Frequently Asked Questions
What are the Typical Inspections that Buyers May Ask For? Who pays for them?
Home Inspection. Pest Inspection. Radon Inspection. The Buyer can ask for any one or all of these inspections. The Buyer pays for the inspections.
Am I Required to let a Buyer have Inspections Done?
No. It is up to you as the Seller to accept a Buyer’s contingency for Inspections. You are not bound to accepting all inspections or none, you can choose to accept one type of inspection but not another. However, it is common that Buyers will name “Inspections” as a contingency in their Purchase Agreement and oftentimes will pose too big a risk to a Buyer if not permitted to have inspections done.
If I Accept a Buyer’s Contingency to Have Inspections Done, am I Required to Pay for the Repairs Needed that May be Reflected in the Report?
No. The Buyer will most likely submit to the Seller a Request for Repairs. It is the decision of the Seller to determine what, if any, repairs will be done and paid for by the Seller. There is a communication process between the Seller’s real estate agent or REALTOR® and the Buyer’s real estate agent or REALTOR® as to how the proposed repairs are resolved, and becomes a negotiation process in and of itself.
What are Seller Contingencies?
A Seller Contingency is a provision in the Listing Agreement that specifies something the Seller needs to have happen before the transaction can be closed. The most common Seller Contingency is when a Seller needs to have a place secured before moving from the property.
What are Buyer Contingencies?
A Buyer Contingency is a provision in a Purchase Agreement that specifies the contract would cease to exist upon the occurrence of a certain event. The most common contingencies that a Buyer will name in a Purchase Agreement are Inspections, Financing and the Sale of a property currently owned by the Buyer. The Seller has the ability to accept any or all of the contingencies a Buyer may name.
What is Earnest Money?
Earnest money is an amount of money paid by the Buyer that accompanies the Purchase Agreement. Earnest money is a way for a Buyer to show a Seller that the offer is being made in good faith. Once a property is under contract (an offer has been accepted), the earnest money is deposited into the Listing Broker’s Real Estate Trust Account (RETA) until the closing. Earnest money is applied to the purchase price on the Buyer’s Closing Statement. If any of the Buyer contingencies are not satisfactorily met, the Earnest Money should be remitted back to the Buyer and the Purchase Agreement is no longer valid.
What does MLS mean?
MLS is an acronym for Multiple Listing Service. An MLS is a marketing database set up by cooperating REALTORS® who are governed by a Local Board, a State Board and the National Board, which is known as the National Association of REALTORS® (NAR). A real estate agent is a REALTOR® when he or she becomes a member of NAR, the world’s largest professional organization. The benefit to being a member of an MLS is that REALTORS® can show properties listed with the MLS even if they are not the listing agent. An MLS system is a great marketing tool for Sellers because it makes their property available to many REALTORS® to be able to sell. An MLS system is a great benefit to Buyers because they can have the same REALTOR® show them multiple properties. We are members of the Lewis & Clark Board of REALTORS® based in Yankton, SD.
What is the Difference Between a Real Estate Agent and a REALTOR®?
All real estate licensees are not the same; only those who are members of the National Association of REALTORS® (NAR) are properly called REALTORS®. REALTORS® subscribe to a strict Code of Ethics. Kaye O’Neal and her Team are members of NAR, and thus are REALTORS®! We are members of the Lewis & Clark Board of REALTORS® based in Yankton, SD.
How do Real Estate Agents or REALTORS® make money?
Real estate agents and REALTORS® make money by earning a commission when they represent either a Seller or a Buyer in a real estate transaction. The commission is typically a percentage of the sales price of a property, when a transaction closes. The commission is typically paid by the Seller. If a real estate agent or REALTOR® works with a buyer or seller for weeks or months without a resulting transaction, they aren’t paid for their time nor reimbursed for any expenses the real estate agent or REALTOR® incurred marketing a listed property. Real estate agents and REALTORS® can also make money by performing Property Management functions, which is the day-to-day managing of property that is owned by another party or entity.
Contact us if you’re interested in selling your home or property, or have any questions regarding the selling process.