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February 5, 2008Numerous articles have been written and seminars held addressing the needs of the first time home buyer. But very few to help you, the FIRST time Spring Texas home seller. You have one real estate transaction under your belt as a buyer, but what you need to know as a seller is so very different than that of a buyer.
So if this is your first time at selling a Spring Texas home, here are some things you should know:
1. Sellers Disclosure Notice – Texas law requires you to provide a sellers disclosure notice for the property. The notice is a disclosure of your knowledge of the condition of the property as of the date completed and signed.
2. Getting your home ready for the market – Once you put your home on the market, the rules change. Your home has just become a product and it needs to look the best it can. I understand that you are still living in the home, but buyers are not attracted to lived in homes. They are attracted to the look of model homes.
3. Choosing a Listing Agent – The best listing agent to hire is going to be the one that has a proven marketing strategy and knows how to attract buyers. Ask the listing agent if they will provide you with a Guarantee. So that if you are not happy with their services you can be released from the agreement.
4. Realtor Fee – In Texas, the Realtor Fee is paid by the seller. The Realtor Fee is paid at the time of closing to the listing broker. The Realtor Fee is split four ways between the listing broker, the listing agent, the buyer’s broker, and the buyer’s agent.
5. Home Warranty – You may want to consider getting a home warranty for the time period that the house is on the market. A home warranty will limit your expenses if something suddenly breaks on the home. Some home warranty companies will even provide you as a seller with free coverage.
6. Option Period – Typically the buyer will request an Option Period of between 7 to 12 days. They will pay you $100 to $200 for the option period. During this time is when the buyer will have their mechanical and structural inspections performed. Based upon the findings of the inspections, the buyers may come back and ask you, the seller, to make repairs or contribute towards their closing costs so they can make the repairs. During the Option Period the buyer also has the unrestricted right to terminate the contract. This means they could wake up on the last day of the Option Period and terminate it. The buyers would still receive their earnest money back at this point.
7. Title Insurance– The seller traditionally pays for the title insurance which protects the seller against claims against the title that might be made after the sale. The cost of the title insurance varies based upon the price of the home. You can expect it to be about 7/10ths of 1 percent. The title insurance that you probably received when you purchased the home is not transferable to the new buyer.
8. Property Taxes – In Spring Texas our property taxes are paid in arrears. Our bills are mailed around November and are due by January 31st of the next year. On the closing statement, you will be giving the buyer a credit for the property taxes for the months of the year that you owned the home. In November, the buyer will receive the tax bill for the entire year and they will be responsible for paying them. The important thing to know about the credit that you will be giving the buyers is that this does not come out of your escrow accounts held by your mortgage company. You will get the money that’s in the escrow accounts, but it will not occur until after you have closed on your home. Usually you will get the funds back within 6 to 8 weeks after the closing date.
9. Do not stop making your mortgage payment – Once you have a contract on your house, you may be tempted to stop making mortgage payments. But don’t do it. Keep making your mortgage payments. The house is still yours until the transaction is closed and funded. Not making the payments will impact your credit score and the type of financing you qualify for on your next home.
10. Condition of home– You need to leave your Spring Texas home broom clean for the buyers. This does not mean that you have to have all the carpets professionally steam cleaned and all the air returns freshed dusted. But it does mean that the new buyers should be able to move right in after closing. You are expected to have all your possessions out of the house upon closing and funding.
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