Most people won’t live in the same home for 30 years, the typical life of a mortgage loan. So, when it comes time to sell, many homeowners still have mortgage debt to deal with. Is this a problem? What happens to your mortgage when you sell your home?
Once you sign your name on a mortgage loan, you are responsible for the money—no one else. This means that you must pay it back, which you can do with the money you gain from selling your home.
The truth of the matter is that selling a house with a mortgage is a common occurrence. It’s not something you need to be embarrassed or worried about. However, there are a few things you should be aware of and a few steps you should take before you try selling a home that you still owe money on.
Check Your Mortgage
The first step to selling a house with a mortgage is to contact your mortgage lender and ask about your current mortgage. You want to know:
- Your current mortgage payoff amount
- Your due-on-sale clauses
Your mortgage payoff amount is the exact amount of money, including accrued interest that you owe to the bank. This amount is typically good for 10-30 days and represents the outstanding loan balance that you must pay. The last thing you want to do is default on your mortgage.
The due-on-sale clauses reveal the exact rules of how to sell a house you still owe money on. It covers such information as when the paid-in-full loan is due and what the process is, including any fees. The clauses won’t tell you who you can or can’t sell your home to, but they may need some additional information about the buyer’s mortgage lender. Be sure to ask any questions you might have about these clauses, so you have a full understanding before you take the plunge and start your sale.
Selling Your Home
Once you know the ins and outs of your loan terms, it’s time to get to selling a house with a mortgage, which can get slightly complicated. First, you’ll want to work with a title company.
If your current lender doesn’t set you up with a title company, you can hire an agent on your own. This agent will be responsible for ensuring that there are no issues with your property’s title, and act as the intermediary throughout the entire purchase and sale process.
Here’s what happens to your mortgage when you sell your home and use a title company:
- The title agent holds the money from the new buyer during the sale
- After you sign all the documents at the closing table, the title agent uses the sale money to pay your current mortgage holder
- Once the amount has been paid, the title transfers to the buyer and you, as the seller, are given the leftover money (minus various fees)
If the sale covers the full cost of the current loan, it’s a fairly smooth process. However, if you owe more than your home is actually worth—negative equity—there could be some trouble. In that case, you’ll have to work out a deal with your lender for a reduced payoff amount, or you may need to refinance and stay in your home for longer than you planned.
In the end, selling a home with a mortgage shouldn’t be a problem. The most important thing is to know your options, so that you can make the right decisions.
For help throughout the entire selling process, visit www.coldwellbanker.com and find a real estate agent near you.
When selling a home, even tiny fixes can have a big impact. Here are 10 of the best low- (or no-) cost home improvement fixes to make your house stand above the competition:
1. Address the Heart of the Home
In real estate, the kitchen is a main selling feature and can be a make or break deal for potential home buyers. If a new kitchen just isn’t in the cards, consider replacing smaller ticket items and de-cluttering. Low- and no-cost fixes for the kitchen include:
- New cabinet hardware
- New faucets
- Installing a new backsplash
- Storing countertop appliances to create more work space
- Replacing dark valances with lighter fabric or removing them altogether
2. Update Switch Plate Covers
Switch plate and outlet covers are brittle, and can crack and yellow over time, resulting in a home that, no matter how well updated, still looks dated. New outlets and covers can be replaced in a snap for generally under five dollars, making it one of the lowest cost updates available. Consider flat switches that create a modern, streamlined silhouette and stick to white for a timeless look.
3. Beautify the Bathroom
An updated bathroom comes only second to kitchens in a buyer’s list of must-haves, so showing them a clean and uncluttered bathroom will score points with any potential buyer.
New flooring can give an otherwise tired bathroom a much needed facelift and create a newer looking bathroom overall. Coordinating linens, a new shower curtain, and thoroughly cleaned grout can top off this easy home improvement investment.
4. Address Storage
Storage is always a concern for buyers. Installing low-cost closet organizers to your existing space will increase storage and organization in your home. Add storage baskets to hide clutter and you will have beautiful storage spaces that will make any buyer envious.
5. Deep Clean for a Good Return
If your home contains wall to wall carpeting, clean carpets can make a world of difference to a buyer. Cleaning carpets can easily be completed in a weekend with a rental cleaning machine, and it creates a noticeably clean, odor free environment for buyers to tour.
6. Boost Curb Appeal
Nothing boosts curb appeal like a tidy yard. Trim and edge walkways, weed gardens, and trim shrubs for maximum impact. If you have a porch, consider potted, seasonal plants to bring the look together.
7. Improve the First Impression
As buyers approach your home, first impressions matter. Ensuring your entryway is clean and inviting with something as simple as a new mailbox or updated house numbers will make buyers feel welcome. Clean windows and doors for extra impact.
8. Add a Coat of Paint
Freshening up your living space with neutral colors will invite buyers to imagine their belongings in your home and will cover up any nicks, scratches, or dents your wall incurred over years of daily living.
9. Update Lighting
While not the lowest cost solution on our list, you will find that a new light fixture or two really breathes new life into key living spaces. If your budget is tight, look to kitchen, dining, and living rooms for the most bang for your buck.
10. Add Some Decor Pizzazz
Finally, a fresh look can be completed with nothing more than some colorful fabric. Inexpensive pillows and throws in a coordinating palette through your home will create a unified look that will have buyers hooked.
Lastly, don’t plan to tackle a home project DIY style until you read 5 Things You Need to Know Before DIY-ing A Home Improvement Project!
Source: CB Blue Matter Blog
Thinking of selling your condo? Whether you live in the condo or own it as an investment property, if you’re ready to sell your home, it’s time to talk to a qualified real estate agent in your area. By evaluating several criteria, including regional markets, time of year, features of your condo unit, as well as your specific needs as the seller, he or she can create a customized marketing plan for your condo. Here are five important topics to discuss with your real estate agent if you want to sell your home:
1. Best Time of Year to Sell Your Condo
The specifics of your area do more to determine the best time to put your home on the market than whether you’re selling a condo or a house. While the conventional wisdom is that spring is the best time for selling a home, this belief simply doesn’t ring true in every locale. In recent years the historic patterns have eased, and in some cases, totally disappeared. Still, different parts of the country have periods when sellers can be more aggressive with their pricing. And your real estate agent may suggest a distinct timing strategy for condominium sales, especially if your condo is in a resort destination.
2. Open House Strategy and How to De-Clutter
A condo that shows well will sell faster and bring a higher price. Small cosmetic touch-ups can make a big difference. Buyers often suspect that more serious problems may exist if they notice the need for minor repairs. If you want to sell your home, it’s important to make sure your condo is clean, tidy and free of personal clutter. Clear sinks and counters of dishes and toiletries. Neatly stack office supplies and organize storage areas. Replace dim light bulbs and clean windows. Even though your garden area may be commonly owned, do your best to create curb appeal by cleaning front steps and porches, and clearing lawns of toys or equipment.
3. Features to Accentuate
One of the best features to accentuate when selling a condo is the lifestyle of ease that comes with condominium ownership. Many buyers are looking for the hassle-free living experience that they can’t find with a single-family detached house. Another important attribute of any condo is the amenities of the association, which can include a hot tub, fitness center, owner’s lounge, covered parking and even concierge services. If you’re considering selling your condo, take the time to walk through it methodically with your real estate agent. Together you can point out which features of the actual condo unit should be accentuated. Does your unit have a wonderful view? Perhaps the location of your condominium is unique and desirable. Your real estate agent can help accentuate these features in sales and marketing materials.
4. Desired Price and Bottom Line Price
When setting the home price for your condo, it’s important to identify your desired price and your bottom line price. By assessing recent condo sale and listing statistics in your area, your real estate agent and a licensed appraiser can estimate your house value and recommend an appropriate target price range. Working with your agent, you can set an initial asking price, as well the absolute lowest home price you would comfortably accept. One advantage of selling a condo is that by assessing the prices of other units in your association that have recently sold or are currently listed, your real estate agent and the appraiser can determine a very accurate house value.
When selling your condo, you may be obligated to disclose problems that could affect the property’s value or desirability, as well as to disclose HOA minutes and costs of common insurance and utilities. In most states, it is illegal to fraudulently conceal major physical defects in your property, such as a water heater that leaks severely. And many states now require sellers to take a proactive role by making written disclosures on the condition of the condo unit. Ask your real estate agent for the particular laws of your state.
After reading this article, read more tips on selling a home and make sure you get the best value on your property on Coldwell Banker’s Seller Resources.
Source: CB Blue Matter Blog
The keys are yours, now what?
Congratulations! You’re a new homeowner. While you may not be able to wait to move in, there are a few things you should consider tackling before hanging those family photos on the walls.
1. Change the locks – For peace of mind, it’s a good idea to change out the locks on your exterior doors to ensure that anyone the previous owners may have given a key to can no longer access the property. According to Home Advisor, the average homeowner spends between $100-$300 hiring a locksmith.
2. Paint – Don’t love the lemon yellow the previous homeowners chose for the master bedroom? Painting your new home will be infinitely easier if you can do so before moving furniture into the space. Head to your local paint store to pick up a few samples to test before committing. Take your time and be sure to view the color swatches in different lights before committing. There are also handy online visualization tool like the Benjamin Moore Personal Color Viewer.
3. Take care of your floors – Like with painting, treating and refinishing floors is much easier without furniture in the way. Costs for this project will vary depending on the size of the job, but you can estimate roughly $200 for supplies and equipment. Check out this useful guide to refinishing wood floors from This Old House before heading to the hardware store.
4. Make any necessary repairs – Does the bathtub need to be re-caulked or the tile re-grouted? Do the floor boards creak? Make a list of priority repairs and tackle them one by one. You’ll be happy you did a few months from now when other projects crop up on the honey do list.
5. Clean from top to bottom – The only thing better than a new home is a clean new home. Now is the best time to give every nook and cranny of your home a deep clean. Scrub the inside of appliances like the refrigerator, oven, dishwasher and microwave. Wipe down walls and baseboards with a damp cloth. Looking for clever ways to banish grease and grime? Check out our Home Tip of the Day video series.
6. Set up your utilities – Call your electric, gas, cable and water utility providers to make sure service is transferred to you after closing. You’ll also want to research when trash and recycling pick-up are scheduled for your zone.
7. Change your Address – While you may want those mortgage bills to be sent elsewhere, it’s important to file a change of address with the US Postal Service to ensure that all mail is forwarded to your new address following your move. Also be sure to alert friends and family of your new address. They’ll need to know where to send that housewarming gift!
Now, the only thing left to do is celebrate! Looking for great housewarming party ideas? Try one of these backyard flings!
You listed your home for sale, but the home isn’t selling! Learn the simple things you can do to sell your home faster with Coldwell Banker real estate agents.
You listed your home for sale with high hopes. You love your property and you felt certain that it would sell in a reasonable amount of time. But it’s been several months since you listed your home.
You’ve had some interests and several showings. You’ve received a few lowball offers. Maybe you’ve even experienced the emotional turmoil of watching a contract fall apart. Regardless of the details, one fact is clear: your property is very much still for sale.
What went wrong? What can you do? Here are 8 effective tips to facilitate a faster sale.
If your house has been on the market for six weeks or more without so much as a nibble of interest, it’s time to take a hard look at what might be putting buyers off.
If buyers can’t imagine themselves living in a home, they’ll be reluctant to make an offer.
To make your home appealing, pack away all of your family pictures, child artwork, and mementos. Paint your walls a neutral color like beige, cream or white. Pack away any polarizing or controversial pieces of artwork or decor. Depersonalize and try to make your home look like a model home.
Buyers like to see clean, wide-open living spaces. If you have physical or visual clutter in the room, you’re sending a message to the buyer that you don’t have enough storage space.
Don’t send that message. Instead, get those moving boxes and start packing. You may not have a contract yet, but if you minimize your possessions and declutter the space, you’ll make the rooms look larger and create the impression of having tons of storage space.
Remove Evidence of Pets
We love our four-legged friends, but their food and water dishes, crates, and even just hair on the carpet can be a big turn-off to buyers who don’t like animals.
If you know that someone is coming to look at your home, put the food dishes away, store the crate in the garage or outside, and make sure to remove all signs of pet fur and dander.
Freshen Up the Space
Don’t let buyers turn up their nose at your home. Smell is the first thing potential buyers notice when they walk into a house.
Clean your home to get rid of any dusty or musty smells. If the weather is nice, open the windows to let your home air out. Install all-natural room fresheners or light scented candles in discreet places like the bathroom closet, laundry room, and garage. Choose a neutral and natural scent, like vanilla, rather than a pungent floral scent.
You could also consider investing an essential oil diffuser to leave running during home showings. Sage, lemon, lavender, and cinnamon are all subtle, relaxing, and inviting scents that help brighten your living space.
Work on Curb Appeal
Some buyers won’t even step into your home if they don’t think the property has curb appeal. Clean the windows and make sure that there are no visible cobwebs. Mow your yard and trim the edges, prune the bushes, plant fresh flowers, and spruce up your shutters by giving them a fresh coat of paint. You may even want to install a new mailbox and outdoor light fixtures.
Consider an Affordable Mini-Renovation
Not everyone likes a fixer-upper. Stained carpets and less than appealing paint colors may look like dollars needed for (and the hassle of) renovation in the buyer’s eyes.
Small renovations may lead to big payoff. Consider painting the walls a neutral color, installing a smart thermostat, replacing hardware and fixtures and other fairly inexpensive changes that will take away the label of a fixer-upper.
Stage Like an Expert
You’ve depersonalized, decluttered, renovated, and worked on curb appeal. Now it’s time to stage your home like a pro.
Place brand new, neatly folded towels and candles in the bathroom. Place a decorative bowl filled with bright red or green apples, lemons, or limes in the kitchen. Fill a clear glass cookie jar with fresh cookies on the kitchen counter.
Ask Your Agent About Pricing
If your home isn’t selling after you’ve done everything above, it’s time to talk to your real estate agent about adjusting the price.
This is where your agent’s knowledge of your market and the amenities of your home come into play. If your home is priced competitively, buyers will feel like they’re getting a great deal. A $5,000-$10,000 reduction may be all it takes to motivate the right buyer.
Make Your Home More Accessible
Make your home available for showings. If you limit your home to pre-scheduled viewings, you’re definitely not going to be able to sell as quickly. If you’re flexible with when you allow buyers to come see your property, you’ll have a better chance of getting more foot traffic and more potential buyers into your home.
Source: Coldwell Banker Blue Mattter Blog
This is SO IMPORTANT for you to know as a Buyer or Seller so that you can strategize your plan of action wisely and accurately. Of course, your agent can easily explain this to you, but you need to understand it! Make no mistake, if you don’t pay attention to the difference in these two markets, you may not enjoy the results of the transaction.
What you need to know when buying or selling a home.
One important thing to remember about the property market is that it’s always in a state of change. Sometimes the market is favorable to buyers and sometimes it’s favorable to sellers. But don’t worry, a knowledgeable agent can guide you in the sale or purchase of your next home, no matter what type of market you’re facing.
What is a Seller’s Market?
A seller’s market is simply a property market that benefits you as a seller. In a seller’s market, there’s a scarcity of properties, which can drive up the price of homes, especially in desirable locations.
Sellers can depend on real estate experts to know what the market is doing, but here are some signs of a seller’s market:
– Low inventory when compared to previous months and/or years
– Homes are selling faster
– Less than six months of inventory on the market
– More homes are selling
– Median sales prices are growing
– Less information in real estate ads; just the bare details
– “For Sale” signs don’t stay up long before being replaced with “pending” or “sold”
What is a Buyer’s Market?
A buyer’s market is the opposite of the seller’s market. If you’re buying at this time you’ll be spoiled for choice as the supply of homes on the market exceeds the number of buyers, giving you the chance to score a fantastic deal.
A sharp agent will quickly be able to tell you where the market lies, but here are some signs of a buyer’s market:
– Inventory that is high when compared to previous months and/or years
– Homes are selling more slowly
– More than six months in inventory on the market
– Sales prices are shrinking
– Fewer sales are taking place
– Real estate ads are growing in size, giving more details and/or images
– “For Sale” signs are staying longer, meaning the days on the market are longer too
How Do I Figure out the Months of Inventory in a Market?
1. Look for the total number of active listings for the month prior to the current one
2. Look for the total number of sold or closed transactions for the same time frame
3. Divide the total number of listings by the number of sales. This figure represents the number of months of inventory there are.
For example, let’s say there were 6,500 listings in one month’s time. During that same time, there were 1,500 properties that were sold. Divide 1,500 into 6,500 and you arrive at 4.3 months of inventory, meaning that this is a seller’s market.
While a savvy real estate agent is the best resource for this information, other resources include real estate listing websites and/or your local real estate association.
Do All Markets Follow the Same Cycles?
Markets are always in a state of flux. At its core, people are the driving force behind the real estate market.
For example, as more people move into a location, the more need there is for housing. If the number of properties in the area cannot support the number of people moving in, prices of existing homes will likely rise until more homes can be built.
This constant change to the supply and demand in a market is how markets shift back and forth from being more favorable for either buyers or sellers.
Can I Buy in a Seller’s Market?
Absolutely, but it’s not going to be a walk in the park. You’ll need determination, knowledge, and most importantly, someone on your side who knows the market inside and out.
Something to consider – you don’t know the seller’s true reasons for wanting to sell. Maybe there’s a divorce pending or another baby on the way and they need more space fast. Whatever is going on with the seller, a savvy agent will spot opportunities to help you and the seller arrive at a mutually agreeable solution.
One key reason it’s vital to engage an agent in a seller’s market is for their negotiating skills. While it’s important to always negotiate, a seller’s market calls for serious help to ensure that you don’t pay more than you need to.
Should I Wait to Sell?
It depends. Is it mandatory that you sell right now or could you wait until it’s a seller’s market again?
Consult with an agent to get his opinion about your chances of getting what you need or want for the sale of your home. He just might have some options you may not have considered that will help you get out from under your home and get on with your life.
Don’t be afraid to sell or buy if you think the market isn’t in your favor. The real estate market can be highly varied, so trust your agent to help you get the best possible results, no matter what the market looks like.
Source: CB Blue Matter