INSIDER'S GUIDE
ATLANTA · ALPHARETTA · BROOKHAVEN · CARTERSVILLE · EAST COBB · WEST COBB · WOODSTOCK
to a successful sale
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ATLANTA COMMUNITIES // Real Estate Brokerage
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Your home is your biggest asset. You’ve invested a lot in it over the years, whether it’s time, money, or just plain emotion.
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Getting Your Home Ready 5 Pre-Sale Inspection 6 Ready Your Document 8 Staging 9 First Impressions 10 Open Houses 12 Negotiating / Accepting An Offer 14 Last-Minute Deal Breakers 16 Closing 18
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Table of CONTENTS
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INSIDER’S GuIDE: Your Strategy For Smart Home Selling
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Your home is your biggest asset. You’ve invested a lot in it over the years, whether it’s time, money, or just plain emotion. So when it comes time to sell, you want to get it right. The problem is there’s a whole lot that can go wrong. You’ve worked too hard to let that happen! That’s why we created this guide. You deserve to feel empowered in your home-selling decisions. We’re breaking the process down into basics. From deciding if selling your home is a good idea in the first place to handing over the keys on closing day, you’ll find simple tips to steer you toward a successful home deal. Of course, my team and I will right beside you every step of the way.
IMPORTANT NOTICE: The information contained within this guide has been provided to assist you with the sale of your property. It is not a definitive solution to all the possible questions sellers may have. Due to the generality of the content and the variations in individual circumstances, we cannot accept responsibility for any misunderstanding that may result from the information provided within. However, please do not hesitate to contact us for any assistance you may require and we will do everything possible to provide the information you seek or direct you to an appropriate source for the answer.
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Introduction
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Getting your home READY
Rooms look smaller when they’re crowded with excess furniture and clutter. Clear out anything that’s not needed to create a feeling of spaciousness - including that treadmill in the bedroom. And don’t forget your cabinets - keep them neat and not too full. This creates a perception that your home has plenty of storage space.
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Repairs can make a big difference. Make sure that all minor repairs are completed. Sticking doors and windows, loose door knobs, dripping faucets, torn screens, or peeling and cracked paint may affect your sale.
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A well presented home says “welcome”. It doesn’t have to be a model home but it should appear to be an inviting place to live.
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Your home will be just one of many on the market at any given time, therefore you need to present your home as appealingly as possible. Our experience shows that sellers who make an extra effort usually achieve a quicker sale and, in many cases, a higher price. The selling process typically starts several months before a home appears on the market. It’s necessary to look at a home through the eyes of a prospective buyer and determine what needs to be cleaned, painted, repaired and/or tossed out. Ask yourself, if you were buying this home, what would you want to see? The goal is to show a home which looks good, maximizes space and creates as much demand - as possible. Every home is unique, and what works for one home may not work for yours. Before you get started with repairs and improvements, we can help come up with a plan and budget for what will make the most impact. Use the Home Improvement Worksheet in the Checklist section of your Seller’s Binder to keep your budget on track.
Let plenty of light into your home. Nothing improves the atmosphere of your home more than brightness. Remove screens from the front windows. When possible turn lights on prior to the arrival of prospective buyers.
Having a home pre-sale InspectiON
A pre-sale inspection might cost a few hundred dollars, but it’s money well spent. It can keep buyers from demanding repairs at exaggerated costs during negotiations, or worse, opting out of the purchase at the last minute. Considering that most major defects found during inspections were not known to the Sellers, it protects you from being blind-sided and you not being able to remedy the defect and capitalize on the improvement. If defects are found prior to sale: You, not the Buyer, determine the type of repair (there can be a wide variation in cost). Buyer does not get cold feet because defect has already been eliminated and properly repaired. Unexpected repairs could delay the closing. We can market the repair/improvement and likely provide you a return on your investment. Complete the pre-sale inspection checklist to ready your home for the market, and the inspector. We also included a “short” list of typical improvements that we advise you to make before you put your home on the market. Don’t worry about checking every single item off the list, but do pay attention to big-ticket issues. These can scare buyers into asking for way more money than it actually takes to fix them. The majority of home insurance companies contribute claims history information to a database called the Comprehensive Loss Underwriting Exchange, or CLUE. A C.L.U.E. is not a secret database, and it gives no score or recommendations, it just tells what happened in and outside the home. It doesn’t take the place of an inspection or disclosures from the seller. The C.L.U.E. Personal Property report provides a seven year history of losses associated with your property. The following data will be identified for each loss: date of loss, loss type, and amount paid along with general information such as policy number, claim number and insurance company name. Here’s how a C.L.U.E. report can benefit you. Sellers who are forthright and transparent with condition and history of their home have an advantage in the market. A C.L.U.E. report can be one piece of the puzzle. Request the personal property report on your property and make it available for prospective buyers to see? That way they know there’s no hidden damage that you made an insurance claim about but didn’t otherwise disclose. It’s peace of mind for a buyer.
Get a CLUE!
Getting a pre-sale inspection to unveil any potential issues with the home can save you time, money, and in some cases, the transaction itself.
We know that problems occur when they are least expected. You’ve worked hard to make the recommended improvements and we want to protect your investment. That is why we place a warranty service contract on your home while it is listed. A home warranty plan covers a variety of mechanical, electrical, and plumbing items, as well as some appliances. This will give you some peace of mind and also provide you with a bargaining advantage during the selling process. Offering a home warranty plan may provide these benefits: Increase the marketability of your home by reassuring potential buyers Help sell your home faster and at a higher price Ward off potential disputes after the sale for repair and/or replacement of covered items
Potential Red Flags
Water damage: Improperly treated water damage can cause the growth of mold and mildew. Radon: This odorless gas, found mostly in rocky areas, can cause cancer. Mold: Toxic mold can cause serious health problems, or even death, especially to infants and those with weak immune systems. Termites and Carpenter Ants: These insects weaken the structure of a home over time. Defective Roofing: This can be a costly problem to repair, depending on materials and age of the roof. Aluminum Wiring: Found in some homes built in the mid 1960’s to the early 1970’s, this is a potential fire hazard. Major Foundation Problems: Foundations can leak, erode, or shift. Requires expert consultation. Missing or Inoperable GFCI: A ground fault circuit interrupter (GFCI) switches off electric power to a circuit when it senses any loss of current. A missing or malfunctioning GFCI can lead to electrocution, electric shock, and electric burns. These can be installed by an electrician fairly inexpensively. Mixed Plumbing: Old and new plumbing components can cause supply issues and may need updating. Undersized Electrical System: Found mainly in older homes, this can result in a shortage of household circuits and outlets. Lead-based Paint: Houses built before 1978 should be checked for lead-based paint as this can cause lead poisoning, particularly in children and pregnant women.
Protecting Your Value
Having key information ready for buyers, many of whom have become increasingly skeptic, can provide them with greater confidence that the value of your home is more closely aligned to the price you are asking. Buyers often ask for information about the property to aid them in their decision-making process. With the right preparation you will be ready, willing, and able to provide them with what they want. Having important documents ready will make a buyer’s decision- making process easier and faster. Being transparent about your home and its history will give buyers confidence that you have nothing to hide. Like with most anything else, higher buyer confidence can translate in greater demand and willingness to pay a premium.
READY your documents
What is for sale?
The document section of your binder includes important documents to collect and prepare. Some of which include: Seller’s Property Disclosure Statement Survey Termite reports and/or termite bonds Information about utility costs, Property improvements Ordering history of any property loss (C.L.U.E. Report) Homeowner association fees and dues.
It is important to determine from the outset what is to be included in the sale of your home. For instance, fittings and fixtures that are easily removed without damage - such as decorative light fittings, wall units and drapes don’t necessarily have to be included. The Sellers Property Disclosure is an optional document, but highly recommended to be used. It helps clearly state what is both included and excluded in the sale. It also communicates with the buyer that you are being forthright about the condition of the home, providing them added peace of mind.
Preparing your home for the market involves cleaning, de-cluttering, updating and repairing, while staging is the process of arranging furniture, accessories, art and light, all to enhance the homes features and space. After all the necessary repairs have been made, your home will likely be in the best shape that it has been in a long time. Maybe the best you’ve ever seen it. And by doing a little staging you can really make a wow factor for buyers. Professional stagers can “see what the buyer sees.” And with the right appeal buying decisions can be made very quickly. Professional stagers know how those decisions are made and create an environment that allows for a favorable decision to be made when buyers look at a home. Professionally staged homes present and show better than competing houses for sale, including new construction homes and higher-priced houses. Staged properties will sell faster when compared with houses that have not been staged. From the date of listing until the day of closing, home staging shortens this time frame, even in a slow real estate market. Staged properties can increase the number of offers and selling price in hot markets. Buyers view professionally staged listings as “well-maintained.” Buyers’ agents recognize that professionally staged listings are “move-in” ready and are inclined to show staged properties. Photos of professionally staged listings look better on the MLS, as well as in print. Professionally staged listings “STAND-OUT” in prospective buyers’ minds.
TIPS:
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STAGING
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Make your home look organized – even if you aren’t. Remove excess furniture throughout your home. Hang mirrors to widen a narrow room. Remove half the contents of your closets to show buyers there’s plenty of room. Add light inside closets to make them look bigger. Take everything off closet floor. Color coordinate and organize clothing in closets. Make the master bedroom feel like a private retreat. Keep bedding in neutral tones to dress up bedrooms. Showcase bedrooms as bedrooms.
The Benefits of
First Impressions ARE LASTING
Prospective home buyers, and real estate agents alike, tend to judge homes by how they initially appear in photos. With a little effort we will be able to showcase your home the way we want, causing agents and buyers to want to see more. What many fail to understand is that when the home doesn’t make a lasting first impression, it can translate into lower interest, longer sale timeframes and lower offering prices. The better the home shows in photographs to potential buyers the more likely they will want to view it and buy it. You are trying to show off the home’s best features, so a lot of “stuff” can distract from those features. De-clutter as much as possible The photographs of your home are usually the first chance to make a great impression. You can improve the value of your home and therefore increase your selling price by presenting your home in an attractive way. A well presented home says “welcome.” It doesn’t have to be a showroom but it should appear to be an inviting, comfortable place. To accomplish this feeling with the buyer it is important to take a step back and view your property with a critical eye. What improvements can you make? How would a potential buyer see your home? Can they easily see themselves living there? What is its curb appeal? Your home will be competing with others on the market at any given time. We want your home to be as appealing as possible. Our experience shows that when sellers who make an extra effort usually achieve a quicker sale and, in many cases, a higher price. Photos are one of the most important aspects of marketing and selling your home. They are typically the first impression that a buyer has when considering your home. This means the most important showing appointment you will have will be with the photographer. Make it count! Take the time to prepare for the photography of your home by using the Photography Ready Checklist.
Clean, clean and clean some more. Professional photographs will capture dirt, glass and mirror smudges, dirty countertops and a wide assortment of other factors that will distract the viewer from seeing the home’s structure and architecture. Dust can show up on photographs.
Remember, if the home makes a lackluster online appearance, you will lose buyer interest before they ever pull up to the curb.
Declutter. Many homes are filled with memories of the past, pictures of your family and treasured knick-knacks that you have collected over the years. These items often distract viewers who are looking for a new home. Please do not take this personally, this is simply a part of the process when selling your home.
Ask yourself, if you were buying this home, what would you want to see? The goal is to show a home which looks good, maximizes space and creates as much demand - as possible.
Here are some tips on how to maximize the effectiveness of your home’s showings. MAKE THEM COMFORTABLE A warm, comfortably heated home on cold days, particularly, if you have an open fireplace, adds a feeling of coziness. On a hot day, don’t forget to turn on the air conditioner. You may like to set the dining table and have a flameless candle on to give your property a homey atmosphere. Avoid staying inside the house while the home is being shown. Buyers sometimes feel they cannot openly discuss concerns with their agent in your presence. Should it be necessary for you to remain at home, be courteous but don’t force conversation with a potential buyer. The prospective buyer wants to see your home and not feel as if they have to be social. However, should you be asked questions about the home, the neighbors, or the area, answer them truthfully, concisely and directly. KEEP IT PEACEFUL As a general rule it is advisable to turn off radio and television sets during showings as they can be very distracting. Keep your pets out of the way (preferably out of the house) and clean and put away pet food bowls (other than water of course). Allow the agent and their buyer to talk, free of disturbances. SOME MORE “DON’TS” Don’t apologize for the appearance or condition of your home, this simply draws unnecessary attention. Don’t discuss the details of you selling such as price, timing, terms, or repairs needed or made. Don’t allow a prospective buyer in your home without an agent. If someone you know is interested and doesn’t have an agent, we will be happy to meet them for a tour. WORKING AS A TEAM Let us handle the showings and speaking with the buyer’s agent. Many buyers feel uncomfortable if the homeowner is there during the showing. Buyers like the chance to really explore the home, imagine themselves living there and give honest feedback. This can be difficult if the homeowner is present. We will work with you closely to identify the selling points of your home that you feel should be emphasized. We will accomplish this by the use of “Feature” cards, HomeBooks, and notable upgrades and improvements.
OPEN HOUSES
Increased exposure results in more activity, more showings, and inquiries that moves us closer to achieving your goal: selling your home at the best price in the shortest time.
You’ve made it! The house is ready for potential buyers to walk through. We now work to put your home at the top of their search, acting proactively to do what is necessary to “push” your home into the marketplace. Much like the grand opening of a business, holding your home open is important to creating more exposure. More exposure means greater opportunity to connect with prospective buyers. TARGETING GETS RESULTS We can target buyers with criteria matching your home. We simply don’t count on the lookers out for a Sunday drive who happen to come across our signs, but also target real buyers and their agents. When your property is listed with Atlanta Communities, we place your home on the most active real estate sites in the area. We then use a proprietary tool to target the best prospects and their agents for your home. It’s what you want...an effective marketing program that creates action on behalf of agents and buyers, not to just wait. We don’t stop there, in addition to our normal marketing, we use social media, posted signs, mailed brochures and ads on the most popular real estate search sites to promote the open house. All the extra promotion going around your open house generates added exposure, opportunity, and quite possibly create a sense of urgency with a interested buyer to not delay an offer. SUCCESS REQUIRES A PLAN & PREPARATION Your open house will receive the highest level of targeted marketing available in the market today! With the assistance of a host agent we start the promotion early in the week, sending out invitations, inviting neighbors, connect with other agents who might have buyers, and promote the event right up until the day of the open house. Everyone who should know will know! Early and repeated contact allows buyers and their agents to include your home in their plans.
Take every offer seriously, even if it doesn’t meet your asking price or terms. Sometimes buyers will ask for a lot or offer a low price but quickly change their position after receiving a response from the seller.
The due diligence period can be one of the most challenging times of the selling process. Up to this point we have done our best to minimize the stress, and if a pre-sale inspection was performed, you won’t be under as much pressure because there shouldn’t be any big surprises. Typically the due diligence period is between 10 and 14 days. During this time the buyer is allowed to have the home inspected and tested. An inspection report is provided to the buyer for review and further negotiations may be necessary if any issues/concerns were identified. Any request made by the buyer will be submitted by the buyer’s agent in the form of an amendment to the purchase and sale agreement. The request may be in the form of asking you (the seller) to lower the purchase price or repair or pay for some or all of the items in need of repair. At this time you have the option of accepting a lower price, making the repairs, contributing money towards the repairs, or simply doing nothing. Whatever the outcome, it’s important to remember that the buyer has the right to terminate during their due diligence period if they are not satisfied with the outcome of the negotiations. EARNEST MONEY At the time the buyer makes an offer and it is accepted by the seller, the buyer will offer earnest money, a good faith measure. This money is generally held by the buyer’s agent’s brokerage firm. While the earnest money deposit can be for any negotiated amount, it typically is for about 1% of the purchase price. As long as the buyer performs in accordance with the purchase contract, the earnest money is applied towards the purchase price of the home at closing. If the buyer does not perform in accordance with the contract they are considered in default and the earnest money is at risk and can be awarded to the seller for damages as a result of their default. FINANCE & CONTINGENCIES One of the first things the buyer will need to do is secure their financing. Depending on the terms of the contract, they usually have three to five days to apply for a loan and 30 days to get approved. It is for this reason that when considering an offer, buyers who are pre-approved can be more attractive than buyers who aren’t. Before we begin negotiating any offer, we will identify if a buyer is pre-approved by asking the buyer’s agent and requesting a pre-approval letter. The contract can also be contingent upon certain requests made by the buyer. Requests can often have deadlines that the seller must adhere to. Request can be things like providing a termite letter or termite bond, taking care of needed repairs, ordering a home warranty, and/or having the home professionally cleaned upon move-out. APPRAISAL The buyer’s lender will have your home appraised. If the home doesn’t appraise for the agreed contract price, the lenders will not give the buyers a loan. This insures the lender that if the buyer is unable to make their mortgage payments, the lender takes the home and uses it to pay the loan. For this reason, the lender will want to make sure the amount they lend the buyer is as close to the value, or less, of the home as possible. If the house appraisal is too low, the buyer may submit an amendment to the seller to reduce the sale price, or the buyer may make up the difference with their own money. Fortunately, there are some things we can do to help avoid a bad appraisal. Most appraisers welcome input from us and we will prepare a thorough package of information about your home to give to the appraiser. This will include data on comparable homes and any improvements you’ve made that increase the value of your home.
Concessions, by Percentage, that Buyers ask for: 37% A Reduced Price 30% To Pay a Portion of Their Closing Costs 28% Purchase a Home Warranty 25% Had No Concessions 12% Leave Appliances, Furniture, Equipment 10% Provide a Repair Allowance 9% Consent To Set Closing Date
We will present any offer in writing, at which time you have the right to accept the offer or you can make a counter–offer, indicating any changes you would like and a price that is acceptable to you. Items to pay close attention to include: Purchase price Suitability of the earnest money Closing date Special allowances for personal property, home improvements, and closing costs Contingency deadlines for the home inspection, appraisal, and buyer financing Additional contingencies such as the sale of the buyer’s current home
OFFER
Negotiating & Accepting
Surviving the Due Diligence Period
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It’s not uncommon to receive several offers close to your asking price. You may want to accept the offer with the fewest contingencies even if it is for less money. Keep in mind the greater number of contingencies, the higher the risk.
Avoid the temptation to ignore an offer because you feel insulted. The most appropriate response is always to counter. The prospective buyer may not have had sufficient time or information to establish a realistic value of your home. They can often change their perception and in a short period of time they return with an acceptable offer.
Last-Minute DEAL BREAKERS
Nothing’s more frustrating than working hard to sell a home only to have the deal crash and burn. Here are common pitfalls that can put your home deal at risk as well as tips to help you bring it back from the brink. A title search uncovers an open lien on your property. Open liens—and any other title problems—must be cleared before you can close the deal. If the lien in question is covered under your title insurance policy, that should make it go away. If not, you’ll have to resolve or pay the lien before you can close. The home inspection identifies a big-ticket repair. This means another round of negotiations with the buyer—and the potential for more money out of your pocket. With an expert negotiator in your corner, your deal should have no trouble moving forward. You just may need to be willing to meet the buyer in the middle to address the issue. Your buyer’s financing falls through. Without financing, your buyer likely won’t have the cash to close on the home. Unless your buyer wins the lottery— or secures another lender before closing day—you can pretty much count on going back to square one to find a buyer who can afford to buy your home. Your home appraises for less than the sale price. For the deal to go through, someone’s going to have to shell out more money to bridge the gap. Odds of recovery depend on how big the gap is between the appraisal value and the sales price. You and the buyer may have to split the difference. An issue comes up in the final walk-through. Last-minute surprises in your home’s condition must be addressed before closing. Follow the Golden Rule by leaving the home the way you’d want someone to leave it for you. It’s as simple as that! Keep your buyer in the loop As you make plans to pack up and move out, don’t forget to take your buyer into consideration. After all, they have stuff to move too! If you run into a snag, let us know immediately so we can prepare the buyer. Sometimes good communication is all it takes to keep everyone happy. Don’t put the cart before the horse Remember, the deal isn’t done until everyone has signed on the dotted line. Don’t cancel your home insurance or hand over the keys until ownership has officially transferred— no matter how harmless it may seem. You don’t want to be caught between a rock and a hard place if the contract falls through. Follow through with your commitments If you agree to fix something as part of the contract, stand behind your commitment and get it done. Aside from being a legal obligation, it’s the right thing to do. Want to be extra nice? Welcome the new homeowners by handing the keys over to a sparkling-clean home. Do expect the best . . . but prepare for the worst Want to know the secret to saving your sanity? Get used to the fact that delays will happen. The trick is keeping yourself focused on the goal when the unexpected smacks you in the face. Rolling with the punches is a lot easier when you place your trust in us to handle the unexpected. It’s our business to handle last-minute surprises so you can close with confidence.
IF YOUR APPRAISAL COMES IN LOW: It is possible for you and the buyer to renegotiate a new, lower purchase price that meets the appraised value. The buyer may choose to increase their down payment to meet the new loan-to-value down payment minimums. Some lenders can dispute the appraisal; however, it’s 100% based on the lender. Depending on the type of loan, the buyer may choose to switch lenders. Worse case scenario, if the contract stipulates an appraisal contingency, the buyer will have the right to terminate the contract and have their earnest money returned.
The closing is an important day for you as a home seller. You will transfer the property to the buyer, fully pay off any mortgages, and receive your sales proceeds. But to get there, you will want to avoid these mistakes. Don’t ignore contingencies. If your contract requires you to get something done before the sale, get it done and make sure it’s done right. Bring receipts for any repairs and inspections made. If the misfortune occurs and something breaks while you are under contract, try to have it repaired before the buyer does their final walk-through. Be mindful of those deadlines. Ideally you will want to move out a couple of days early and be ready to turn the keys over at closing. Disclose! Don’t hide liens from the buyers. If you have had a tax lien placed against the home or you are delinquent on any homeowners association dues/fees, the title search will uncover them.
The Closing // BEING PREPARED
Finally, it’s Closing Day
Making it to the Closing
Here’s a list of things you should bring with you to the closing: Photo ID. Certified check and a personal check if you owe money at closing that’s less than $5,000; otherwise, the money needs to be wired. All house keys, garage door openers and alarm system code. If you have a Power of Attorney, bring the original Power of Attorney prepared by the attorney closing the transaction. Any warranties that are in effect and repair receipts if applicable. Any documentation and receipts required by the purchase and sale agreement for repairs, inspections, cleanings, etc.
You’ve planned and worked toward this day, likely having it circled on your calendar. This is what you can expect at the closing. The closing attorney is responsible for handling: Ordering and obtaining a title examination. Review the findings of the title examination. Obtaining any liens, HOA, and tax information on the property. Obtaining and reviewing mortgage and, if any, lien payoff information that have been requested by lenders and any other interest associated with property. Preparation of the closing loan documents. Recording the closing documents. Issuing title insurance to the Buyers. Dispersing the lender’s and/or purchaser’s funds.
What to Bring to Closing
Ready for the move?
You’re almost there! Next comes packing up and moving into your new property. Moving to your new home can be very hectic so it pays to plan well in advance. Start organizing the move as soon as you can. Sort and sell things you don’t need at a garage sale and put the money towards moving costs.