Hidden expenses related to the sale of a house

Selling a property in today’s world can be challenging on many levels. You want to get as much money as possible, you want to sell in a timely manner, and you want to take advantage of current market conditions that can be used to the advantage of sellers, but you may not be in a position to do everything, if any of these things given your situation. One possibility that many sellers tend to overlook is what alternative selling strategies (other than the traditional method of going to a real estate agent) they could use and improve their ability to better meet their ultimate goals with the sale of their property. property. The methods that home buying companies regularly use to purchase real estate can often create a more beneficial sales scenario for the seller and can often eliminate many of the additional known and unknown costs that a seller might incur during a traditional sale .

When you sell a house the traditional way, you first have to pay the agent’s fee. These fees are always the responsibility of the seller. Some agencies will offer reduced fees to list/sell your property, but unless you are very lucky or a great negotiator, you will generally pay the buyers agent full commission. So while you may be able to get up to one and a half percent off your listing agent, they’ll still offer four and a half, up to a maximum of six percent of your final sales price, just to pay the agent fees. . That’s an equivalent of $4,500 to $6,000 for every 100k of value you have in your property. That doesn’t come out of the amount you owe either!! That comes directly from “your” hard-earned equity, of which you may have already lost a lot in the last five years.

Another cost that will always be the responsibility of the seller, again unless they are a great negotiator, will be all the taxes and HOA fees that are currently unpaid as of the date of the sale. This obviously includes all amounts past due, but it also includes current unpaid balances, which are not yet due as of your statement date, but have an amount past due since the last time a required payment was made on time. If you pay your taxes or your HOA on any schedule other than in full up-front, you may find yourself with these additional costs coming from your capital. On the plus side, this works the other way too, in that if you’re paid in advance, you’ll receive a refund of any amounts paid after the sale date. Either way, you need to know exactly where you are with these payments.

Another cost that, especially in today’s economic climate where everyone is looking for a “deal,” you may be asked to pay, would be to cover half or even all of your closing costs. These costs are normally paid by the buyer, but in a buyer’s market, when inventory exceeds demand, buyers will request “concessions,” a term to be noted, from the seller to enhance their purchase. Remember what I said earlier “everyone is looking for a deal” and if you don’t give them one, many feel the next one will, and they will just follow your deal to find another. There is a very high percentage of sellers paying at least half of their closing costs today because of this buyer’s market mentality. So consider another one percent or more of your estate threatened.

The last unexpected expense that you may also incur is the possibility of having to fix something to make the sale. Again, another one of those “Grants” I talked about, and again, another result of buyers’ market mentality, and again, another reason for your potential buyer to leave if you don’t follow through on their requests. Repair grants can range from something as small as shampooing your carpets to replacing your entire roof, or anything in between. All of which would have to come out of your pocket and must be deducted again from your hard-earned capital!

6% to agents, 1+% to closing, tax and HOA prorations, and potential repair costs are all serious selling considerations a seller might face when using the traditional selling method.

When you use one of the many local companies that buy homes, they will usually/always eliminate some, if not all, of these additional selling costs that one might face. It is not uncommon to receive an offer to buy that says “Net to Seller”, which means that the buyer pays all costs associated with the sale and the offer amount is the “Full Amount” that the seller will put into his or her pocket. .

Now this does not necessarily mean that you will actually keep more of your money by going this way. You need to remember that these home buying companies are in business to make money, not just for fun. However, they can use these costs that they would normally pay anyway, as their discount from the fair market value of their property, thus creating the cushion that they can use to make money. So what is the benefit to the seller then?

The benefits are simple, but powerful. You get everything presented in plain English. There are no hidden agendas because if these companies are not completely transparent about their intentions, they are leaving themselves open to lawsuit. A suit that would probably put them out of business, and that’s not very good for business right now! Also, when these home buying companies are interested enough to make you an offer, it means they are serious about meeting the terms of the contract and buying your property. They are serious buyers who are much less likely to fail to deliver on an entire purchase. They’re not looking for the next best deal around the corner, they’re not looking for a reason to back out, they’re not looking for “concessions” from the seller. Your offer and purchase contract are simple, direct, and backed by serious purchase intent, with emotion not a factor in the equation.

Finally, many of these home buying companies have more than one possible buying strategy with which they can purchase real estate. This is the biggest benefit for any seller whose specific situation could inhibit a clean, smooth and profitable traditional sale. Creative buying strategies are for many in the current economic climate the only way a seller can make a fruitful real estate transaction, sometimes if ever. These home buying companies are often the only ones offering these creative strategies to the seller for whom traditional methods simply won’t work, as well as to those simply looking for alternatives that could speed up the process or perhaps put an end to a nightmare of not sale.