Frequently Asked Selling Questions

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1) How much is this going to cost me?

Seller typically pays all real estate commissions, about 6%, in addition to third party liens or debts against the property, transfer tax, and seller portion of escrow and title fees. Seller could also pay buyer closing costs, if negotiated into the deal.

2) What can I expect the buyer to pay for – what can or will escrow PRORATE?

Buyer will pay buyer escrow and title fees, and seller will pay seller escrow and title fees…..USUALLY. Escrow will prorate taxes, and rents – if any.

3) I realize the value of my home might be a little lower than I thought, but don’t my upgrades count for something?

Yes, but generally an appraiser doesn’t value your upgrades to the same degree you do. A viking range will not increase your home’s value $25,000 – a modicum of perspective is needed here, in addition to a modicum of common sense. In other words, what if you have a pool home….in NYC? This will not enhance the value as it would in southern CA. When in doubt, ask your realtor:)

4) Why is pricing my home above market so bad, if it doesn’t sell, can’t I just reduce the price?

Well if you happen to be in a buyer’s market, and prices are falling, odds are good that your price reductions will be too little too late, and will never quite keep pace with the market. How do you hit a moving target? By leading it a bit….if the market is going down, price ahead of the curve, same principle applies to appreciating markets. Therefore, if you’re priced a bit high in a seller’s market, well then this is not so bad as time will be on your side.

5) When does escrow start, when will the buyer put his or her EMD (earnest money deposit) into escrow?

Escrow starts generally once ratified contracts are sent to escrow. EMD should be deposited by buyer within 3 days of buyer receipt of executed contracts, if not sooner.

6) Who picks escrow, can I ? What if the buyer wants a different escrow company than I do?

In California, buyer has a right to choose. However, as mentioned a few times now..EVERYTHING IS NEGOTIABLE. When in doubt, defer to the contract for specifics.

7) What happens if the buyer discovers a deficiency in my property during escrow and then requests that I repair it – do I have to oblige ? Can I say no to a repair request?

No you do not have to oblige. However, if the buyer request for seller repairs comes during buyer allotted contingency timeline, please be aware that refusing this request affords the buyer an opportunity to cancel the transaction.

8) What happens if my vacant property is vandalized during escrow, because I moved out thinking buyer would close – but buyer needed more time for loan and then property was vandalized, is this my responsibility?

Depends – did you agree to give buyer more time? If you did, then seller must correct this issue, or reach an amicable resolution with the buyer. It is always a seller responsibility to deliver the property to the buyer in the same condition as it was when buyer made offer. If seller moves out, this is not buyer’s problem – if seller agrees to the an extension, then seller also implicitly agrees to extend the duration of their responsibility for the property.

9) What happens if buyer cannot close on time – can I cancel?

Yes, if a notice to perform or a demand to close has been issued by seller and buyer has not closed or performed.

10) What happens if buyer has waived or removed the appraisal contingency, but not the loan contingency, and property appraises for less than contract price?

Well the two contingencies are nearly synonymous. if the property does not appraise, then buyer will not be able to get a loan, and can always back out with a loan contingency…

11) If I have a change of heart after I accept the offer, can I back out?

No, unless your offer called for a seller contingency – but even so, I’ve never seen one for “seller having a change of heart.” If seller tries to cancel for this reason, buyer could sue for specific performance.

12) What if buyer is unable to secure a loan, can I keep the deposit?

Depends. Does the buyer want more time? Has more time already been given with the condition that deposit goes to seller if not closed? If so, then absolutely. If not, only way seller can get deposit is if buyer agrees to this in writing – not too likely.

13) What happens if buyer tries to renegotiate terms once we are in escrow – is this legal?

Legal? Well it happens all the time in the form of price reduction requests, repair requests, extensions, etc…Buyer can always ask for whatever they want…and you, the seller, can always say NO to any or all of buyer requests – just be mindful about timelines and what saying NO means for the you, and for the buyer.

14) My property has a septic system, am I required to certify that’s it’s operational and cleaned out?

Only if the contract says so.

15) what if the buyer discovers a problem with the property that I didn’t know about and then wants to back out, is this allowed? And if so, am I liable here?

Depends – are you willing to fix the problem? IF not, buyer can generally back out. Seller is NOT liable unless it’s clear that seller willfully concealed this information. If you are willing to fix the problem, then buyer cannot back out – for this reason at least..though in my experience if a buyer wants out – they will find a way out.

16) What if the my property has a serious problem that buyer discovers after close – is this my responsibility?

Depends, did you know about the problem? If so, did you disclose it. If you did, you have no responsibility. If you did not disclose because you didn’t know about it, it’s not your responsibility. If you knew and failed or “forgot” to mention this…you could have a pretty big problem on your hands, recommend consulting a lawyer.

17) Someone died in my house, do I need to disclose this?

Depends – how did they die? Natural causes? If it was murder, it generally needs to be disclosed.

18) What if there are back taxes and liens against my property that I do not wish to pay for, can I get the buyer to cover these costs?

You can try, if buyer says no, and you still don’t want to pay for them, buyer can back out.

19) Buyer is requesting to make repairs for his loan, do I need to pay for this? And do I NEED to allow buyer to make repairs on my property BEFORE it’s closed – is this normal?

It is normal, but NO, you do not need to make the repairs or to agree to them. Please be advised, however, that buyer inability to complete repairs needed for loan, will likely impugn buyer ability to complete the transaction.

20) If buyer appraisal comes in low – am I required to reduce the price? If not, what does this mean for me? What does it mean for the buyer?

You are not required to reduce the price. However, if your contract is predicated upon an appraisal contingency and mortgage financing, as many are, buyer can back out if you do not agree to the price reduction.

21) If the buyer asks for repairs, and I agree to them, can he then ask for NEW repairs to be made?

He shouldn’t, but buyer can always ask for whatever he or she wants, and you can always say no, particularly to redundant or unreasonable requests.

22) Buyer wants to move in early, should I let him?


23) Is there a danger is listing my home TOO LOW???

IF you have GOOD, honest, and ethical realtor..NO. Why? Because a lower list price will simply generate more interest, more demand, and more offers. The absolute highest offer you receive is market value:)

24) What difference does “the most likely buyer type” make in developing a pricing and/or marketing strategy for my home?

Big difference. If the most likely buyer is an owner occupant end user, for example, relying on mortgage financing, you want to make sure that all major systems are functional, and that the house has good curb appeal. If your buyer demographic is the investor, however, these issues take a back seat to the most important criteria for the investor buyer: How much meat is there on the bone? Investors need a built in profit margin in order for the deal to make sense to them. Understanding who your most likely buyer is, and developing a marketing strategy accordingly, will better position your property for optimum market exposure to your target demographic.

25) How can I find out if my taxes are current?

Escrow will tell you, or you can check with your realtor

26) How will escrow know how much to pay my lender?

They will order a payoff from your lender once you provide them with a mortgage statement.

27) What if my friend or family member who is in the real estate business disagrees with what my realtor is doing?

Trust your realtor, dissension is normal, particularly among disgruntled realtors who have just discovered that they have a friend or family member that didn’t use them:(

28) Can I fire my realtor once we are under contract?

Not really, no, unless you can demonstrate that gross misconduct is jeopardizing your transaction, or causing you financial harm. If you have a problem with your realtor, best to address this immediately.

29) What if my realtor brings me a full price offer and I decide I’d rather wait a few months to sell instead, am I liable for anything here?

Yes, a commission to not just your realtor, but possibly to another realtor who brought the buyer as well.

30) Does HOA cover termite repairs – is this their responsibility?

Typically, yes – but only termite repairs relegated to the outside of the unit.

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