In today’s market, many homeowners that are considering selling their home think about selling on their own. But what are their reasons for considering such a time consuming and risky option? For most people that choose the ‘For Sale by Owner’ route, it’s because of the savings from paying a real estate agent a commission. But while the typical commission split between the sellers and buyer’s agent is 6% hiring this professional will not only provide ease and peace of mind during the transaction. Your real estate professional will be able to navigate the tricky channels of a real estate transaction and will keep you out of trouble with the man possible scenarios of what can go wrong.
Now you must be thinking, “What are the things that can go wrong?” With the average transaction lasting around 40 – 45 days, you may not be aware of everything that occurs behind the scenes. The average 40 – 45 day transaction period is usually stipulated by your home’s listing period, escrow deadlines, inspection periods, appraisal dates and final mortgage approval. During this time, with all the deadlines and timelines, these are just a few of the possible issues that can arise:
Fewer Buyers Come To Your House
Marketing your home well when you’re selling is crucial for as many potential buyers to see it as possible. Although there are many great ways to market your home online without the use of a real estate professional, like Zillow and Facebook, without the proper knowledge of how to utilize them, you may be missing out on a number of buyers that would be interested in your home. A licensed Realtor has the experience of marketing homes and knows exactly what words to use, who to hire to take the proper photos and how to get the exposure on the free sites you’d use. Real estate agents also have the insight into getting the exposure you desire and need on other websites that may require money to advertise and market on, like Google and on the local Multiple Listing Service or MLS. Using the internet as the primary tool to market your home can be the best way to find a buyer. Most top Realtors will use 10- 30% of their commission for selling your home and spend it on advertising to make sure your home sells for maximum value.
Real Estate Is A Full-Time Job
It often amazes ‘For Sale by Owners’ how much time it takes to sell their own home. As a Realtor, it is a full-time career, and most do not realize that it takes the majority of your time. Between the time it takes to market your home correctly too, the showings that will have to be scheduled for potential buyers that would like to come to look at your home. There is significant work to be done before going under contract. Then the closing process begins which takes a ton of detail-oriented work in regards to the paperwork and legal tasks that must occur during this time. Understanding the industry as a whole is also needed, and with the use of a licensed Realtor, not having to worry about how to accomplish tasks like financial pre-screening of buyers can mean many hours saved for you. According to Zillow, 36% of sellers attempt to sell their homes themselves, but challenges along the way lead many to hire an agent. In the end, only 11% of sellers end up making it to the closing table and sell their home without an agent.
Pricing Your Home Incorrectly
Real Estate agents have the knowledge of not only knowing the housing market but also the tools to price your home right. These reports are called a Comparative Market Analysis and can narrow down an accurate market value of your home. Not using these tools or a professional to do so can cost you thousands of dollars from your pocket. According to The National Association of Realtors, the typical ‘For Sale by Owner’ put their home up for sale for $60,000 under market value. That’s $60,000 that the average For Sale By Owner doesn’t get to put into their pockets. Now, I know what most of you are thinking, “Without paying an agents commission, I will have saved money.” What most sellers do not understand is that the average For Sale By Owner programs recommend you offer a 2.5% commission to the buyer’s agent. This is typically a standard throughout the industry. Now, if you choose to list with our team, we can offer a 5% commission rate. This means we take only 2.5% and offer the buyer’s agent 2.5% commission (which is what most For Sale By Owners would be offering them anyway). So, in most For Sale By Owner cases the seller is not saving 6% or even 4.5%, they are only “saving” 2.5%. For the 2.5%, our team provides incredible marketing, full representation, negotiations, buyer feedback, scheduling for buyer showings, advice, a transaction coordinator, and so much more. This simple math could make or break your home selling experience.
Understanding what is reasonable when it comes to negotiations requires full knowledge of what possibilities there are when itcomes to the options you are negotiating. Without the proper experience of prior negotiations, some sellers can find themselves unable to negotiate properly when it comes to their home. Would you personally know how to handle a situation where the buyer is requesting repairs or a large amount of money off the purchasing price? With the use of a Realtor, you are fully represented for all of the transaction. This means you won’t have to worry about what options could be offered to counter the buyer’s requests. The Realtor does all the hard work for you! Other areas in which negotiations are common in real estate include during the pre-offer phase, the inspection, the appraisal, and anything with the closing process such as an issue with the title. Having not only a licensed real estate agent, but one with the experience to represent you is peril.
The Closing Process
What happens during the closing process is a culmination of more than a month of gathering and preparing documents. These documents are required to be not only filled out properly by both parties, but they must also be notarized and filed with the state by a certain time. To make the closing process even more difficult, these papers must be kept on file for up to five years after the closing takes place, or you could be fined for not being able to produce the documents. Now, most Realtors have what is called Transaction Coordinators. They are key team members who keep track of deadlines, documents and submit files for review just to make sure everything is being done legally. Our team is lucky enough to have Heidi Reisel on board. Heidi is our go to when it comes to any questions we may have on either the seller side or the buyer side if we are representing them. Our team also has a preferred title company as well. A title company makes sure that the title to a piece of real estate is legitimate and then issues title insurance for that property. Title insurance protects the lender and/ or owner against lawsuits or claims against the property that result from disputes over the title.
This article isn’t on our blog to scare anyone into contacting us. It is simply our way of fully informing people of the possibilities in real estate. Our team is here to guide and support anyone who has real estate needs or dreams. Our team is here any time for a no obligation consultation to help get your home sold and for all other real estate needs. Contact us today!