STEPS TO SELLING A HOME

Like most people, your home is the most expensive asset. If you have a mortgage, your house is the source of you largest debt. When you selling the goal is to reduce as much liabilities as possible, while maximizing your Net Proceeds.

STEP 1: GET PRE-APPROVED FOR FINANCING  

Whether you are selling you home to upgrade or downgrade, its always best to have a Pre-Approved Mortgage from a Lender before you list your house for sale. The reason is, your financial situation may have change since you bought your home, you may not qualify for a new mortgage or the Real Estate Market may not have a replacement home at your price range. The one thing you want is to be able to get a home that you want, and not to end up renting or in a home that was less than ideal from what you wanted.

Before you sell. having a Pre-Approved Mortgage by a Lender and consulting your Real Estate Agent for accurate research of the Real Estate Market in the area you want to live in, will give you the best picture of what you need to buy a new home.

STEP 2: CHECK YOUR MORTGAGE PAYOUT TERMS

Typically, most people have a Closed Mortgage, which comes with penalties if you pay off your mortgage too soon. It’s best to contact your Lender or your Mortgage Broker and ask them for a breakdown of any additional fees, charges or penalties if you payoff your mortgage sooner. Your lender should give you a disclosure of estimated costs when you apply for loan Pre-Approval.

It may also be possible to Port your Mortgage. This means that you can transfer your existing mortgage to the new home you just bought without any penalty. However there are several factors that may affect the portability of the mortgage. Contact your lender to see if you can Port your Mortgage.

STEP 3: DETERMINE HOW MUCH YOUR HOME IS WORTH

There are Factors that affect how much your home its actually worth. Your Real Estate Agent will prepare a comparative analysis of your house to give an approximation of the value of your house. However, an Appraisal will give you a more accurate picture of your home’s valuation.

STEP 4: MAKE NECESSARY REPAIRS &  PREP PROPERTY

In order to maximize the resale value of your home, it may be necessary to do a some repairs and/or renovations before you list. The easiest and least expensive things that can be done to improve the look of your home include repainting, closet and cabinet organizers, fixing landscaping and gardening, general cleaning and de-cluttering (most home-stagers simple remove and store a lot of your furniture).

When you sell your home, you are trying to convey it as a product that is better that is available now. Be proactive in keeping your house “staged” and looking ready for buyers at all times. You never know when a prospective buyer will want to see your house. It is a lot of work to get everything done, but will literally pay off when done.

STEP 5: ESTIMATE YOUR COSTS TO SELL

  • Real estate agent commission (if you use an Agent to sell your property)
  • Advertising costs, signs, other fees (if you plan to sell by owner)
  • Lawyer fees and disbursements (typical disbursements include: land transfer taxes, title insurance, courier fees, banking charges, government registration fees, etc.)
  • Prorated costs for your share of annual expenses, such as property taxes, home owner association fees, fuel tank rentals, etc. (such are commonly referred to as “adjustments”)
  • Any other fees typically paid by the seller in your area (surveys, inspections, etc.)
  • Any costs associated with maintenance and preparing your home for sale.

STEP 6: ESTIMATE COSTS TO BUY NEW HOME

Calculate all your moving expenses, loan costs (including any penalties), down payment, home inspections fees, Real Estate Agent Fees,  Legal Fees, new insurance policy. All of these are expenses related to buying a new home.

STEP 7: CALCULATE YOUR ESTIMATED NET PROCEEDS

(a) The sale price of your home, minus (b) all the costs of selling your house, minus (c) paying out the Mortgage, which equals (d) the Net Proceeds.

Ask yourself, will your closing Net Proceeds be enough to cover your costs to buy a new home? If not, do you have the cash or other funding to make up the difference?

STEP 8: LETTING PEOPLE IN & SHOWING THE HOUSE

When your house is being shown, the best reason as to why you should leave is because lurking Sellers make Buyers nervous. If they don’t feel comfortable in your home, how will they ever think of it as theirs? The best thing is to let Buyers and their Agents view your home without supervision.

Staging your house also means that your house should always be available for show, even though it can be inconvenient for you. Co-operate with your Real Estate Agent and allow them to put a lock box in a convenient location for Buyers Agents.  Most Buyers Agents will be able to give you a few hours notice before they show up at your house.

The best thing to do is try not to be home during the selling process. The more available your home is, Agents and their buyers can comfortably view your home. When showing a house, Buyers want to feel like this is a house they could live in, and if you are there, well, can you imagine another family in your potential new house? The more the Buyer feels that their family can live in your house, the more likely they are to buy it.

Some simple things to do to improve a prospective Buyer’s impression of your home:

Lighting – Turn on all the indoor and outdoor lights. A lit house gives the Buyer a “I’m home” feeling.

Fragrances – Avoid using scented sprays,  as some fragrances may not be loved by everyone, and some people could be allergic to the scent.

Pet Control – If you have pets, make sure you or your Real Estate Agent puts a notice on your MLS Listing and at the front door. This will help prevent the escape of your pet. If possible, try to take your pet with you  or keep the pet in a specific room when there are showings of your home.

Kitchen Trash – Make sure that all the trash bins are empty. Trash does not send a positive message. You may go through more plastic bags than usual, but its a small price to pay for selling your house.

Keep the House Tidy – This is a necessary habit and it is hard to keep. Everytime before you leave, make the bed, do dishes, put away clutter and do one last vacuum. The house should look like a model home in a Builder’s Showroom. The more your home looks like that, the more likely someone will buy your home.