19 Things Nobody Tells You About Selling Your Home

In case no one has told you this yet, selling your house is a lot of work, and it’s stressful. Here are 19 things you probably won’t be expecting when you list your house for sale:

  1. You have an incredible amount of stuff. I know you think you don’t, but when it’s time to start prepping your house for sale and clearing all your clutter, you’ll realize just how much has accumulated. Throw out, donate and store your stuff – think of it as pre-packing for your upcoming move after a successful sale.
  2. Your feelings will probably be hurt by what the Stager or REALTOR® recommends. If you’re working with a full-service agent, they’ll probably send in their Stager (don’t worry, the agent usually pays). If they don’t work with a stager, at a minimum you can expect your agent to walk through your house, room by room, and tell you what needs to be done to improve the saleability of your house. This part of the selling process is personal…and it’s usually pretty painful. Keep in mind: the goal is to market your home to its highest and best use and appeal to as many buyers as possible – it’s not a personal attack on your decor style. Professional stagers know what buyers want to see and what catches their attention, online and in person.
  3. Your renovations may not have added as much value as you think. We call this the HGTV curse – the idea that everybody has been brainwashed into thinking that if they invest $10,000 into renovating before they sell, that they’ll make $20,000 in return. Truth: it doesn’t always work out that way, in fact sometimes, people lose money on the work they’ve done. Truth. Before you invest even a penny into renovating pre-sale, call in an experienced Realtor. He/She will be able to tell you what’s worth doing and what’s not.
  4. Some agents are rude: they may show up for a showing appointment late, or not at all. And many of them will leave their shoes on, despite the sign that tells them to remove them. I can’t defend this behavior, but at least, I can warn you. With tens of thousands of agents in the Houston area, you can expect a good chunk of them won’t respect your time (sorry).
  5. While your property is on the market, you’ll have daily stress about the number of showings: shouldn’t there have been more showings by now? What’s normal? An experienced agent should be able to predict mostly what to expect for the type of property you have and tell you in advance what’s normal in your neighborhood and for the time of year you list. The number of expected showings will change depending on how long you’re on the market, and hopefully, your agent will let you know at the first sign of something that isn’t normal and expected so you can react and adjust accordingly.
  6. While your property is on the market, you’ll wonder about every showing: was that my Buyer? Did they like it? Are they going to make an offer? In most cases, your agent won’t actually be at the showing, unless he or she is bringing their own potential buyer through the home. Good agents will ask for feedback – but they’ll usually wait a day or so to do it so as not to signal desperation. Unfortunately, most agents won’t actually give much, if any, feedback.
  7. Between the time after you’ve accepted an offer and the close, you’re responsible for making sure that nothing happens to the home. Buyers are entitled to the home in the same condition it was in when they purchased it, so if something breaks, you’ll need to fix it before close. If it was already broken – hooray! Not your problem. You’ll need to maintain home insurance until you don’t own it anymore.
  8. On that note: sometimes, sales don’t close on the day they’re supposed to, and while this is a huge pain, you may want to consider extending the insurance on your home a day or two past the closing date, just in case. If you don’t do that, and something goes wrong, and the closing gets delayed, don’t forget to call the insurer and tell them to extend your insurance! You don’t want to be the person telling the ‘if only I would’ve’ story at a cocktail party.
  9. You need to disclose defects. As much as I’m sure it’s fun to fantasize about not telling potential buyers about what’s wrong with your home, that’ll hurt you in the end. As a seller, you have a legal duty to disclose anything that could impact the new buyer’s use and enjoyment of the house.
  10. You’re likely to be expected to leave the property in pristine condition on closing. Your offer agreement probably stipulates that you can’t just move out and leave your home a mess. Think karma and have your house professionally cleaned before you move out.
  11. When agents bring their clients back to see your property a second time, that’s a good sign, but far from a guarantee of an offer. Also true: most condo buyers only visit a property once before putting an offer on it. I don’t know why it just is.
  12. Your buyer will probably see your home for the first time online. Gone are the days when realtors introduced buyers to properties. Motivated buyers are online, obsessively checking listings multiple times per day. If your home doesn’t look good online – spectacular photos and wicked marketing copy – and they aren’t falling in love right away – you’ve got a long road ahead of you.
  13. You’re going to become all stalker-y. While you’re listed, you’ll wonder about your competition, how many showings they’re getting and how busy their open houses are. Truth: I’ve had sellers go undercover to their competitors’ open houses. Truth: I’ve done that too. You’ll also wonder how much everything around you is selling for. Totally normal. A good Realtor will pre-load you with all that intel.
  14. Buyers don’t care what’s convenient for you – they want to see your home on their own schedule. Sellers who turn down showing appointment requests often don’t realize the risks they are taking. Stats show that 50% of the showings that get refused don’t get rebooked. Buyers are fickle that way, and you may have just refused a buyer who wants to close when you do.
  15. In my experience, the average condo gets an offer after 12-15 showings, and the average house gets an offer after 8-10 showings. Those are totally unscientific stats, but in my experience in selling homes, it’s almost always the case – at least if the property is property staged, photographed, priced, marketed and it’s easy for agents to show.
  16. Leaving your home every time there’s a showing sucks – but it’s worth it. No buyer can comfortably look through your home while you’re there, watching their every move. You’ll spend a lot of time at Starbucks, the park, or at your in-laws – but that discomfort will payback, I promise.
  17. Unless you own everybody’s dream home (most of us don’t), expect some low ball offers and don’t let your feelings get hurt. Even in bidding wars, we see low ball offers regularly. A good agent will be able to justify your asking price and negotiate the price to market value. Don’t be afraid of negotiating.
  18. Bidding wars don’t always work. I know you read about crazy bidding wars all the time, but it doesn’t always work. Getting multiple buyers at the table at the same time is an art, and depends on your property, your neighborhood, your competition, your asking price, the marketing and more. Don’t assume you’ll get a bidding war – and be prepared with a backup strategy if you don’t.
  19. Every property sells when the price is right. It doesn’t matter if you own a really gross house full of mold or a condo next to the party room and across from the elevator – there’s a market for every home.

Deed vs Title: The Absolute Distinction

Deed and title are often used interchangeably, but they are not the same thing. One is an actual document. The other is the rights given by the document. Here’s the difference between deed vs title to clear up the confusion and misunderstandings.

A deed is an actual document that conveys ownership of real property. It is the document used to transfer ownership of real property such as a house from one party to another. It is evidence of a title.

A title is the legal ownership of a property and the rights conveyed in the deed. It is not a document. It is the concept of the bundle of rights acquired by having a deed.

When a home is sold the owners on the deed are updated with the name of the buyers and the name of the sellers are removed. This update is typically done by the title company handling the sale of the home. Depending on the number of deeds that need to be updated it can take a few days to a few months for the deed to be updated.

Title companies are almost always part of the home buying process. As the name states, title companies ensure all processes are followed to ensure a smooth transition of title from the seller to the buyer by sending the change of deed information to the county.

You can check the ownership for a deed online for Harris County, Galveston County, and Brazoria County.

4 Questions to Ask When Touring a Home

Going to a showing soon? Make sure to ask these questions as you tour the property:

1. Does it look maintained and well-cared for? When sellers put their home on the market, they usually put a lot of time into the landscaping and curb appeal, do a deep clean of the interior, and dec-clutter to show off the space of the home. If the home does not look well-maintained or cared for, there may be costly repairs necessary.

2. Will this fit my needs? Evaluate space, storage, layout, etc. Will the layout of the square footage meet your needs? Do you have a hobby or special needs that require unique storage or flex space?

3. Is there work to be done to get it to my liking? If you’ll need to do renovations, you will want to factor this into your decision (and make sure it will fit your budget). Most sellers try to make their home move-in ready while others leave them as-is for the new buyer to put their personal touch.

4. Will it fit in with your long-term goals? Is there room for a growing family or a yard for your future pups? If the home works for you now does not fit into your long-term goals, can space in the home be modified to meet future needs or are you ok with this being a starter home with plans to buy again?

5 Contingencies That Protect You As A Homebuyer

Including contingencies in your contract can help protect you, your finances, and your family when buying a home.

Here are some important ones to consider:

Option period contingency, which is a specified amount of time – usually 5-7 days – that allows you to back out of the contract for any reason or no reason at all during that time period. During that time you will want to have the home inspected. If necessary you will also use this time to negotiate repairs. When working with a lender have your loan officer provide the monthly payment including any escrow payments for homeowners insurance to ensure the property is within your target monthly budget.

The buyer’s financing contingency, which allows you to back out if your mortgage loan doesn’t come through – even if you were pre-approved at the time of submitting the offer. The is negotiable and for a set amount of days – typically within 14-21 days.

The property’s financing contingency allows you to back out if the property does not meet the lender’s requirements.

The appraisal contingency protects you from owing extra money should your lender’s appraisal come in low. Most lenders allow a variance of 1-3% between the appraised value and offer price. For example, if you offer $200,000 on a home, at a 1% variance, the home could be appraised for no less than $198,000 because $200,000 x .01 = $2,000. What happens if the property does not appraise? If the home is appraised at $195,000, you can either pay the additional $3,000, renegotiate the sales price with the seller, or walk away from the offer.

The sale contingency, which says your purchase is only valid if you’re able to sell your existing home first. Sellers are typically reluctant to accept an offer with this contingency unless your home is already under contract.

Make sure to talk through possible contingencies with your agent before making an offer. The most appropriate ones vary from buyer to buyer.

Pre-Qualification vs. Pre-Approval: What’s the Difference?

When it comes to the home-buying process, a key part of the equation is being ready. That means making sure you can demonstrate to a seller your ability to pay for the home in which you’re looking to make an offer, and having some up-front documentation from a lender.

A prequalification letter gives future home buyers an opinion of the range of the amount they may be able to borrow to buy a home. It is based on non-verified information provided by the applicant and does not include a credit report inquiry.

A preapproval gives future home buyers an estimate of the amount they may be able to borrow to buy a home, based on an initial review of financial information provided by the customer and credit report information.

Since a prequalification is not based on verified information, it only takes about 5-10 minutes. A preapproval will take approximately 20-30 minutes on average to interview the customer, enter their information into the origination system, pull a credit report and receive a preliminary credit decision.

A preapproval letter should be updated if the customer’s offer exceeds the estimated maximum loan amount. If the purchase price/loan amount needed by the customer is lower than the preapproval letter, a new preapproval is not required. A new preapproval for a larger amount may be generated at the customer’s request, and a higher credit amount authorized if the customer qualifies for the new amount.

When consumers are qualified for each new home pricing scenario, it is common for a future home buyer to ask for multiple preapproval letters for a variety of loan choices. A higher preapproval amount is subject to additional review to ensure the customer qualifies for the new amount.

Some other things to keep in mind:

  • A preapproval letter will give assurance to sellers that you will likely be able to secure a mortgage based on your credit report, but it is not a guarantee you will be approved. That approval process takes place when, after your offer has been accepted, that the mortgage underwriters approve your loan.
  • A prequalification letter can be helpful to buyers who are looking to understand the price range they should concentrate on during the home search, but is not the best option to accompany an actual bid.
  • In addition to having your credit scores pulled, the lender will base their preapproval letter based on W-2 forms, a current pay stub, a summary of your assets and your total monthly expenses. If you already own a home, you would also need to provide the mortgage statement and a copy of your homeowner’s insurance policy.

To summarize: A preapproval letter is much more serious than a prequalification letter. It shows you are ready and qualified to buy a home at a certain price point. It’s what you want in your hands if you are home shopping and need to move quickly.

How to Get the Best Mortgage Rate: 5 Basic Steps

Want to know how to get the best mortgage rate? Interested in buying a home? Unless you’re a military veteran, you better start saving for that down payment! In addition to saving, you’ll want to prove yourself a highly qualified buyer so that you can get the best mortgage rate possible.

This is extremely important because the terms of your mortgage can make a big difference in how much you pay to borrow the same amount of money.

Improve Your Creditworthiness.

According to Bankrate, the best mortgage rates are available to borrowers who have credit scores of 760 or above. Nowhere near that number? Don’t panic. You can improve your credit score by paying down or paying off loans, paying past-due collection accounts, and cleaning up any errors you discover on your credit report as they can — and do — occur. In fact, 25 percent of credit reports contain errors that are serious enough to result in being denied credit altogether. You can see where you stand by getting a free copy of your credit report.

Lower Your Debt
Paying your bills on time and paying down your credit card balance can reduce your debt-to-income ratio, or DTI, which improves your chances of qualifying for a low mortgage rate. Make sure your debt-to-income ratio, which compares the amount of money that you earn with the amount of money that you owe creditors, is no more than 36 percent. Anything below 36 percent is considered “good.” If you’re in the 37- to 43 percent range, many lenders will still give you a loan, but if you’re above 43 percent, it may be time to reevaluate how you’re spending your money.

Find Steady Employment
Mortgage lenders prefer candidates who can prove steady employment for several years. Ideally, you have been on the same job for at least two years or have made a job change and moved into an even higher-paying position. If your income is spotty (For example, if you’ve got long periods of unemployment or up against a pattern of declining income) that’s going to be problematic. And if you’re self-employed, you should know that there are many hoops to jump through.

Have Ample Cash Reserves on Hand
How much liquid cash will you have after closing to cover your new mortgage payment? The standard requirement for cash reserves on a mortgage is two months. This money should be saved in savings or checking accounts, certificates of deposits, or money market funds.

Shop Around

Shopping around for a home loan or mortgage will help you get the best financing deal. A mortgage is a product, just like a car, so the price and terms may be negotiable. Shopping, comparing, and negotiating may save you thousands of dollars.

Within a 45-day window, multiple credit checks from mortgage lenders are recorded on your credit report as a single inquiry. This is because other creditors realize that you are only going to buy one home. The impact on your credit is the same no matter how many lenders you consult, as long as the last credit check is within 45 days of the first credit check. More information is available at Consumer Finance Protection Bureau.

3 Reasons Why Your Offer Could Get Rejected

Houston’s bay area is a hyper-competitive real estate market. With more demand than supply, well-priced properties are getting snapped up within days of getting dropped onto the market. Buying a home in the area doesn’t just start and stop with finding a property you like. Once you’ve found the property that suits your needs, your offer still needs to be accepted. Therefore, patience will be your greatest friend. Let’s discuss some of the reasons your offer could get rejected.

You’re Being Outbid
So you’ve found the property you just can’t be without. You and your agent discuss the strategy to move forward. Your agent submits an offer. A day later, the listing agent tells your agent that the property has received multiple offers. This is where you and your agent need to be tactical about how to proceed with an offer. On the one hand, you don’t want to lose out on the property, and on the other hand, you don’t want to grossly overpay because you have a fear of missing out.

You and your agent find a number that makes sense based on neighborhood comps, and maybe throw in a slight premium to give you the best chance of getting the property. However, that slight premium that you threw in might not be enough! After submitting the revised offer, your agent hears back that you were outbid. Don’t let losing out eat you up — it happens. Ultimately, someone bid significantly above comps to get this property. Do you want to buy a property at the top of the market, or do you prefer being strategic about the price point you get in on?

You’re Financing and Others Are Offering All Cash
Cash is king. Leverage and credit are the American way, but cash still rules everything around us. The same thing holds true for real estate sales. You may have provided a higher offer, but because of the amount of time involved in financing a deal, a seller would generally be much more inclined to take an all-cash offer at a lower price. There is simply much more risk involved with financing. Will you get the mortgage? Will the property appraise? Low appraisals do happen, and there is something you can do if your appraisal comes back lower than the contract price.

Your offer is going to be contingent on financing, which means that if for any reason you can’t get financing, you can back out of the deal. For an all-cash buyer, there are no financing contingencies, because they don’t require appraisals or a review from underwriting.

Your Starting Offer Is Way Too Low
Getting an offer accepted at first pass, particularly when you’re bidding under the asking price, does not happen very often. The caveat is that when you’re an all-cash buyer, you may have sellers bending over backward for you because losing out on you is a risk they may not want to take. An offer is often a conversation starter. It gets the dialogue started and begins the back and forth between parties over price and other contingencies.

However, if your offer comes in significantly under ask, it may function as more of an insult than an opener to dialogue. Don’t expect sellers to negotiate themselves down if your offer is so low that it may not be deemed serious. Your offer will get flat-out rejected with no counteroffer provided.

The Appraisal Process Explained

When a seller has accepted a buyer’s offer the buyer’s lender will send out an appraiser to make sure the purchase price is in line with the property’s value.

Appraisals help guide mortgage terms.
The appraised value of a home is an important factor in the loan underwriting process. Although lenders may use the sale price to determine the amount of the mortgage they will offer, they generally only do so when the property is sold for less than the appraisal amount. Also, the loan-to-value ratio is based on the appraised value and helps lenders figure out how much money may be borrowed to purchase the property and under what terms. If the LTV is high, the lender is more likely to require the borrower to purchase private mortgage insurance.

The appraised value is not a concrete number.
Appraisals provide a professional opinion of value, but they aren’t an exact science. Appraisals may differ quite a bit depending on when they’re done and who’s doing them. Changes in market conditions also can dramatically alter appraised value.

Appraised value doesn’t represent the whole picture of home prices.
There are special considerations that appraised value doesn’t take into account, such as the need to sell rapidly.

Appraisers use data from the recent past.
Appraisals are often considered somewhat backward-looking, because they use sold data from comparable properties(often nicknamed “comps”) to help come up with a reasonable price.

There are uses for appraised value outside of the purchase process.
For selling purposes, appraisals are usually used to determine market value or factor into the pricing equation. But other appraisals are used to determine insurance value, replacement value, and assessed value for property tax purposes.

How To Add Curb Appeal

The first impression a buyer gets when seeing your home in person is all about the curb appeal. Don’t send them running away!

  • Trim bushes and branches so they don’t block windows or architectural details.
  • Set a pot of bright flowers (or a small evergreen in winter) on your porch or front walkway.
  • Install new, matching locks and knobs on your front door.
  • Repair any cracks or holes in the driveway, and clean oil spots with degreaser and a steel brush.
  • Edge the grass around walkways and trees.
  • Stow your garden tools and hoses out of sight, and clear kids’ toys from the lawn.
  • Buy a new mailbox.
  • Upgrade your outdoor lighting.
  • Purchase a new doormat for outside your front door.
  • Clean your windows, inside and out.
  • Polish or replace your house numbers.
  • Mow your lawn. Also, turning on the sprinklers for 30 minutes before the showing will make the whole yard sparkle.
  • Place a seasonal wreath on your door.

How To Attract More Buyers

These tips will help you convince buyers your property offers top value for their dollar.

Amp up curb appeal.
Look at your home objectively from the street. Check the condition of the landscaping, paint, roof, shutters, front door, knocker, windows, and house number. Observe how your window treatments look from the outside. Something special‒such as big flowerpots or an antique bench‒can help your property stand out after a long day of househunting.

Enrich with color.
Paint is cheap, but it can make a big impression. The shade doesn’t have to be white or beige but stay away from jarring pinks, oranges, and purples. Soft yellows and pale greens say “welcome,” leading the eye from room to room and flatter skin tones. Tint ceilings in a lighter shade.

Upgrade the kitchen and bathrooms.
These are make-or-break rooms. Make sure they’re squeaky clean and clutter-free and update the pulls, sinks, and faucets. In a kitchen, add one cool appliance, such as an espresso maker.

Add old-world patina to walls.
Crown molding that’s at least six to nine inches deep and proportional to the room’s size can add great detail on a budget. For ceilings, nine feet high or higher, consider dentil detailing, which is comprised of small, tooth-shaped blocks in repeating ornamentation.

Screen hardwood floors.
Refinishing is costly, messy, and time-consuming, so consider screening instead. This entails a light sanding‒not a full stripping of color or polyurethane‒then a coat of finish.

Clean out and organize closets.
Remove anything you don’t need or haven’t worn in a while. Closets should only be half-full so buyers can visualize fitting their stuff in.

Update window treatments.
Buyers want light and views, not dated, heavy drapes. To diffuse light and add privacy, consider energy-efficient shades and blinds.

Hire a home inspector.
Do a preemptive strike to find and fix problems before you sell your home. Then you can show receipts to buyers, demonstrating your detailed care for their future home.