This is part 2 of a 3 part report. Click here if you missed part 1
Maximize Your Home’s Exposure
Spread the word about your home sale through advertising, open houses, and especially by telling everyone you know. Don’t base your marketing solely on websites geared towards advertising other for sale by owners. Most homebuyers don’t go to these websites when they are looking for a home.
Put yourself in shoes of a potential buyer. Yard signs and ads only reach a small percentage of potential buyers. According to the experts, most buyers usually come from referrals from real estate agents and brokers in the area, not advertising. You’ll have to come up with alternative methods to reach potential buyers since you won’t have the same type of resources available to you.
Consider ways to reach out-of-town and even foreign buyers who make up a decent percentage of today’s homebuyers. Be ready to answer the phone anytime it rings and give every prospect a tour of the house at their convenience. If you only expect to show the home at a weekly open house, you’ll likely never get it sold. Buyers usually expect to see homes at days and times that are convenient to their schedule, not yours. Otherwise, they’ll move on to another home and not even consider yours.
Be prepared to follow up with all prospect’s phone calls. When you find someone who is interested in your home, make sure they can actually afford the home and can qualify for financing. Carefully analyze their financial standing, including salary, debts, liabilities, job security, credit scores (from all 3 bureaus), and debt-to-income ratios.
Consider if they might be eligible to purchase your home using any one of dozens of purchase loan programs that maybe available in your community and/ or zip code. Will they need down payment assistance? Will they need you to contribute towards their closing costs? If so, this could drastically affect your bottom line, since many lenders require down payments of anywhere from 3%- 10% and closing costs usually average 3% of the purchase price. If your buyer doesn’t have these funds available and seasoned in their bank account, they may not be able to purchase your home, and you don’t need to waste time working with a potential buyer who may not even be able to buy your home in the first place.
Show The Home Objectively
When showing your home to a potential buyer, stay in the background and let the prospect discover the home on their own. Most homebuyers hate being walked through a home with a seller who is distracting them by pointing out features and details they could care less about. They are trying to mentally place their belongings visually inside the home, and can’t do it if you’re giving them a tour as if you’re an over zealous real estate agent who’s desperate to make a sale.
Be careful not to become defensive if they point out flaws in your home or features you spent thousands of dollars enhancing, but they could care less for. Lessen the impact of flaws by pointing out the home’s compensating factors. For example, if you spent $10,000 renovating your kitchen with top of the line appliances and accessories, but this potential buyer hates to cook, they’ll despise you for even bringing it up. Tailor your comments to fit their needs and interests, not yours.
People who buy homes being sold By Owner are notoriously known for making ‘low-ball’ offers. Don’t be offended if they make you an offer that’s 10%-20% lower than your asking price. Since you don’t have a real estate agent representing you, most of these buyers will try to take advantage of the opportunity by trying to purchase your property at a steal.
Try to keep interest in your property high while you resolve a potential buyer’s doubts. Agree on the price, terms, inspections, contingencies, date of possession, any personal property that will remain with the house, and be prepared to respond to any objections. Be ready to explain the contract to the buyers and prepare to draft any needed stipulations and/or amendments. To help prevent a lawsuit later down the line, be sure to have the signed contract examined by your real estate attorney before you move forward.
Provide Financing Assistance
Because most buyers have only purchased one or two homes in their entire lifetime, many will need assistance obtaining the right financing to help them purchase. Explain the pros and cons of different types of financing and identify the lenders who offer the various types. Be able to explain the difference between VA, FHA, conventional, as well as other types of financing options. Thoroughly explain all loan documents and application forms to the buyers, because they are likely to have lots of questions at this stage. Be ready to answer questions pertaining to loans, points, taxes, down payment costs, interest rates, ownership costs, PMI, closing costs, title insurance, property taxes, and so on.