Selling a home these days can seem like a complex and often confusing process. Here’s a handy outline of the steps involved in a real estate transaction from the sellers’ perspective.
While we help people buy and sell properties every day, we are ever mindful that most people only buy/sell real estate a few times in their lifetimes, and that selling a property can seem like a complicated and confusing undertaking. Below is a handy outline of the steps involved in selling a home.
- Interview/Hire a Great Agent
The time to get the help of a great agent is at the very beginning. This will save you a lot of time and trouble, as the agent will be able to advise you on what needs to happen every step of the way. - Determine Value/List Price
One of the first things your agent will do is visit you at the property, and then conduct a careful market analysis of recently sold comparable properties to determine your property’s value and a smart list price. - Prepare Property for Market
Your agent will be able to tell you what needs to be done in order to get your house ready to list. Most houses need some cleaning and de-cluttering. Some properties will need some repairs and perhaps updates made prior to listing. The goal, of course, is to invest as little time and money as possible while still aligning with a quick, top dollar sale. - Professional Photos
Once your property is looking its absolute best, it is time for photos. We are always amazed when we see listings go live that have no photos on them yet. (Perhaps half of listings go live with no photos.) It is very important that there are photos on the listing when it goes live, as that is when it is emailed to all agents and the Buyers who are searching for similar properties. If there are no photos, the listing will likely be rejected and never looked at again. - List Property in MLS and other Websites
Once the photos are done and edited, the property has been carefully researched and a beautiful description of it written, it’s time to list it in the MLS, and to make sure it is included in hundreds of other websites like Zillow, Trulia and Realtor.com. - Showings/Open House
As soon as the property is listed, you will likely begin to get showing requests. We have great technology available now where you can simply receive a text message whenever an agent wants to show your property, and be able to respond to showing requests with a simply “Y” or “N.” Unless the property is expected to sell immediately, this is also the time to schedule the first open house, which will likely be on a Saturday or Sunday afternoon. - Receive/Review Offers
Once showings are underway, you may receive an offer (or a number of offers) at any time. In this hot sellers’ market, it is common for multiple offers to be received. Your agent will advise you on how to choose the best offer based on many factors. (Price is not the only concern: you will be negotiating for the best terms for you as well, and of course verifying that the Buyer is financially able to purchase your property.) - Contingency Timelines Begin
Once you are under contract, the clock starts ticking, and a number of tasks must be completed as described below. - Buyer Applies for Loan
Unless the sale is a cash sale, the Buyer will be getting a mortgage, which means there must be an appraisal. After the contract is bottom-lined, the Buyer will have a limited number of days (as specified in the contract), to apply for the loan and order the appraisal. It will typically be around two weeks before the appraiser visits the property, and around three weeks before the appraisal report is in. - House Inspection
The Buyers will have a limited number of days to have an inspection done; typically, this is withing 7 – 10 days of the contract being bottom-lined. If there is a well and septic that needs to be inspected by the Buyer, 14 days is a typical timeframe for those inspections. (In Washtenaw County, Sellers are responsible for having the well and septic inspected by a County certified inspector, and in order to sell the property, the well and septic must pass that inspection.) Every house inspection turns up some problems. After the inspection, it is common for further negotiation to be needed concerning repairs or credits for repairs. - Appraisal
Once all house inspection issues have been resolved, everyone will be waiting for the results of the appraisal. If the property appraises for sales price, everyone is happy and the deal naturally moves forward. If the property appraises for less than the sale price, then unless there was an appraisal bridge in the purchase agreement, further negotiation may ensue. - Negotiations Complete
Once all house inspection and appraisal issues have been negotiated, the loan goes back to underwriting for final approval. At this time, some further documentation may be needed by the lender in order to approve the Buyers’ loan. - Clear to Close/Scheduling Closing
Once underwriting is satisfied with the appraisal and approves the loan, we are said to be “clear to close.” It is only after we are “clear to close” that closing will be scheduled. - Final Walk Through
Buyers will walk through the property before going to closing. Usually, this walk through is within 24 hours of closing. The point of this walk through is to make sure that the property is in the same condition it was in at the inspection, and that all light fixtures, appliances, window treatments, etc., that were supposed to be left at the property have not been removed. - Close/Possible Possession
Many times, Sellers will give possession of the house (keys, etc.) at the closing table. It is becoming more and more common, however, for Sellers to remain for some time after closing. This gives them time to get the funds from the sale, close on the property they are buying, and then move.