At Ruo & Haschig Realty we look forward to the opportunity to successfully market your home.  One of the many services that we provide is this Comprehensive Seller’s Guide.  This will prepare you for the nuances involved in the home selling process.  Our ultimate goal is to achieve 100% customer satisfaction; we are determined in this pursuit.  We expect to accomplish this by making your move as pleasant as possible.  Below is an outline of general procedures that should be followed to show your home.

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Extra Efforts:

• Empty out the attic to display the full value of this much appreciated but often neglected storage space.
• Clean and brighten the basement with light paint and large wattage bulbs.  Drain sediment from your water heater to eliminate any rusty water flowing from hot water taps.
• Treat pets to a stroll while your house is being shown.  Many people are afraid of or allergic to animals.  By removing them, buyers won’t feel hurried or anxious.
• Light classical music sets the stage for a serene, tranquil showing.  Potential buyers can look at your home quietly and without distraction.
• A modest investment in time and money can add thousands of dollars to your final selling price.

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Your Home is Listed, NOW WHAT?

Buyer’s Agent phones us to arrange a showing We arrange the showing with the buyer’s agent We communicate to you (usually 24 hours in advance) that we have a showing, along with the date and time Your home is shown When the buyer’s agent provides feedback, we communicate this to you promptly If the buyer is interested, we will be asked to provide additional information An offer is received We review the offer with you and render an opinion We begin the negotiating process and perhaps make a counter-offer

The showing agent will usually leave a business card.  But if they don’t, our office uses a key-box system where all agents are electronically logged before entering your home. 

If someone claiming to be a buyer comes to your home without an agent, it is in your best interest not to let them view your home.  Politely let them know that they should contact us to make an appointment.  If they are working with another agent, they should contact their agent to arrange for a showing.  Also, it is best to vacate your home for showings.  Buyers usually feel more relaxed viewing a home when the homeowner is absent, and agents generally can more easily focus on selling.

Within the first two weeks of listing your home, many of the innovative marketing concepts that we discuss during the listing presentation will be implemented, typically in the following sequence:

Home placed on the internet accessed MLS in MA or NH with color photos

Home placed on REALTOR.com

Lawn sign - if applicable (most condominium associations prohibit sign use)

Introduction at weekly sales meetings

American Home Shield Protection Plan (if opted for)

Local media placement

100 Just Listed cards will be sent to neighboring homes

A color flyer will be emailed to the top producing REALTORS in the area

I encourage you to call us with any questions or concerns during the entire listing period.  We are here to service you and your family.

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Understanding the Real Estate Market
According to the National Association of REALTORS®, if a house is priced correctly, the owners should receive one offer for every 9-10 showings.

In our market, the number of showings that your home should get weekly depends on the price range. 

If your home is not being shown, it means that agents and buyers think our price is too high.
Recommendation:  A significant price adjustment.

If your home is being shown, but we are not getting any offers, it means that buyers are bidding on other homes that they think offer more.
Recommendation:  A moderate price adjustment.

If your home is in the running, but the buyers buy something else, or if the buyers view your home a second time, but they buy another home, it means that we are most likely close to receiving an offer.
Recommendation:  A minor price adjustment.

If you have not received an offer after 10 showings, please contact us and we will discuss what adjustment should be made.

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The Purpose of Feedback The reasons we call the agent who showed your home are: To jog the agent’s memory about your home so that we may inspire a second showing. To answer any questions or concerns the buyer expressed so that your home may be reconsidered. To get reaction from the buyers or agents that might help us to better market your home. Please Note:  Agents do not usually give a full critique of your home.  If they showed many homes, they honestly may not remember yours in detail.  Also, if an agent doesn’t call us back, it means the buyers are not interested.

Interpreting Feedback

Price objections are always clothed in different terms. Seller’s Goal:  To offer the greatest value in the price range.

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When an Offer Is Delivered
The initial Offer to Purchase contract is usually preprinted with fill-in the blanks and is accompanied with a deposit.  Together we shall review it. The terms of agreement will include:

Sales Price, Closing Date and Contingency Clauses

The buyers specify any special terms of the sale.  This may include articles to be included with the house (such as appliances) and response, settlement and occupancy deadlines.  The offer may also be made contingent on the buyers’ ability to acquire financing.  At this time we will negotiate the purchase contract terms.  If the terms are acceptable to you, the contract is signed and becomes binding.  If original offer terms are not acceptable, you may counter with terms or dates more favorable to you.   Many offers are countered because of sales price and/or closing date.  Counter offers can continue through several revisions.

When terms are accepted by both you and your buyers, we will provide a copy of the executed contract to you and will keep you updated as to the status of the buyers meeting any contingencies, i.e. mortgage commitment, contained in the contract.

Inspections
The buyers will likely have a building inspection at their expense.  This should occur within two weeks of the fully executed purchase agreement.  The inspector will check the condition of the structure from basement to roof:  the utilities, the appliances that are to remain as part of the sale, for termites, for lead, for radon, the septic tank and well, the pool and oil tank, if applicable.  An inspection can take anywhere from two to three hours, depending on the size and condition of the home.  As a courtesy to buyers, you should not be present during the inspection.  Depending on inspection results, we may be negotiating on repair issues with your buyers.  Usually most buyers are only concerned with health and safety issues.  We will attend the inspection.  As a seller, you may offer a home warranty to alleviate any concerns the buyers may have.

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HANDLING MULTIPLE OFFERS It’s possible you may be faced with multiple competing offers to purchase your property. We can explain various negotiating strategies for you to consider. For example, you can accept the “best” offer; you can inform all potential purchasers that other offers are “on the table” and invite them to make their “best” offer; you can “counter” one offer while putting the other offers to the side awaiting a decision on your counter-offer; or you can “counter” one offer and reject the others.  If you have questions about the possibility of multiple offers and the way they can be dealt with, ask us to explain your options and alternatives.

Realize that each of these approaches has advantages and disadvantages. Patience may result in an even better offer being received; inviting buyers to make their “best” offers may produce an offer (or offers) better than those “on the table” – or may discourage buyers who feel they’ve already made a fair offer resulting in them breaking off negotiations to pursue other properties. We will explain the pros and cons of these strategies (and possibly other) negotiating strategies. The decisions, however, are yours to make.

Appreciate that our advice is based on past experience and is no guarantee about how any particular buyer will act (or react) in a specific situation.

Consider the following issues and dynamics:

Sellers want to get the highest price and best terms for their property.

Buyers want to buy at the lowest price and on the most favorable terms.

Listing brokers – acting on behalf of sellers – represent sellers’ interests.

Buyer representatives represent the interests of their buyer-clients.

Will a seller disclosing information about one buyer’s offer make a second buyer more likely to make a full price offer? Or will that second buyer pursue a different property?

Will telling several buyers that each is being given a chance to make their “best offer” result in spirited competition for the seller’s property? Or will it result in the buyers looking elsewhere?

What’s fair? What’s honest?  Why isn’t there a single, simple way to deal with multiple competing offers?

Knowledgeable buyers and sellers realize there are rarely simple answers to complex situations. But some fundamental principles can make negotiating multiple offers a little simpler.

Realize the listing broker represents the seller – and the seller’s interests, and the buyer-representative represents the buyer – and the buyer’s interests. As real estate professionals we are subject to state real estate regulation, and to the Code of Ethics of the National Association of REALTORS®.

Frequently frustration and misunderstanding results from cooperating brokers being unaware of the status of offers they have presented on behalf of their buyer-clients. Listing brokers should make reasonable efforts to keep buyer-representatives up-to-date on the status of offers. Similarly, buyer-representatives should keep listing brokers informed about the status of counter-offers their seller-clients have made.

Finally, buyers and sellers need to appreciate that in multiple offer situations only one offer will result in a sale, and the other buyers will often be disappointed their offers were not accepted. While little can be done to assuage that disappointment, fair and honest treatment throughout the offer and negotiation process, coupled with prompt, ongoing and open communication, can enhance the chances that all buyers – successful or not – will feel they were treated fairly and honestly.

Once an Offer Is Accepted

Mortgage Commitment Contingency
If there is a mortgage contingency, the mortgage amount is indicated in the purchase agreement.  The buyer generally requests a period of 3 to 5 weeks for mortgage approval:  this too is stipulated in the purchase agreement.  Once the buyer makes formal application, which should be done immediately, the mortgage company will contact a licensed appraiser to complete an appraisal of your home.  The appraiser will arrange to visit your home through the real estate agents.  This should be done within three weeks of the mortgage application.

Final Preparation For Closing
Once the mortgage contingency is fulfilled, there are a few details that need to be attended to.  Please refer to the “Closing Checklist.”

Closing The closing is generally held at a Title Company’s or the lender’s attorney’s office.  Most buyers will complete a “final walk-through” and will personally inspect your home to see that it is in the same condition as when they agreed to purchase it.  If there were repairs to be made as a result of the inspection, the buyers will want to ensure that they were done according to the contractual agreement.  The “final walk-through” is arranged through the real estate agents involved in the sale.  The date of closing was agreed upon during the negotiation period and is indicated in the contract.  The time of closing is usually determined within the last week of the closing date.  By this date you should be all packed and ready to go.  Except for a few incidentals that might need your attention (please refer to your “Closing Checklist”), your selling journey is over and you have reached your goal. Congratulations, it is now time to celebrate!

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SELLER’S CLOSING CHECKLIST

Prior to Closing

The New Reality of Property Insurance - What You Should Know

Q.  How can insurance availability/affordability affect the real estate transaction?

A.  The affordability and availability of insurance affects both buyers and sellers.  Buyers will typically be obtaining mortgage financing to pay the purchase price of the property.  The lender will require that there be property insurance to cover their interest in the property.  If proof of insurance is not available at closing, the lender will likely refuse to release the funds and therefore delay or even derail the transaction, either of which can impose both inconvenience and cost to the buyer and seller.  Even in a cash transaction the buyer may be hesitant to complete a transaction where insurance is not available to cover the buyer’s equity in the property.

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Q.  When should a buyer apply to obtain an insurance policy to cover the property being purchased?

A.  The interest of both buyers and the sellers now suggests that the buyers should begin their search for insurance no later than the time of the contract to purchase is signed.  This helps to assure a firm commitment for the issuance of a policy well in advance of the settlement of the transaction.  Waiting until the last days or even weeks before the closing can limit the opportunities of the buyers and sellers to address the affordability and availability issue and, if needed, to find alternatives for difficult to insure properties.  There have been many examples of transactions which have been adversely affected in some manner because of problems associated with insurance availability/affordability.

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Q.  What kinds of events/records can affect the ability to obtain insurance on a property being purchased?

A.  A number of factors can affect the availability and cost of homeowner insurance on a property being purchased.  For example, they include:

• past claims filed on the property (up to previous five years)
• poor insurance credit score of the prospective purchaser
• past claims filed by the property purchaser on other properties
• physical characteristics of property (e.g., leaky roof)
• characteristics of the property’s location (e.g., proximity to fire station, regional weather conditions)

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Q.  How does the insurance company know what claims have been filed in connection with the property?

A.    Approximately 90% of all insurance companies contribute information regarding claims to an insurance industry database.  When underwriting a new policy the insurance company may obtain a report from this system from one of a couple different sources to determine the property’s claims history.  This report is most often identified as a Comprehensive Loss Underwriting Experience report or a “C.L.U.E. Report.”  The report contains information regarding property claims filed in connection with a particular property and claims filed by a particular insured person.  For a fee the current owner of the property may obtain a copy of this report. A copy of the report is available to the property owner through companies such as ChoicePoint, Inc, either by writing to ChoicePoint, Inc. located in Alpharetta, Georgia, or by going to their website, choicetrust.com, and A-Plus, either by writing to A-Plus located in Jersey City, New Jersey or calling 800/709-8842. 

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Q. Should I get a copy of the C.L.U.E. Report?

A. While this decision is up to the property owner, it is important to understand the limitations of the report.  The report contains only raw information and how that information will affect the insurability of a property isn’t explained as a part of the report.  Moreover, not all insurance companies use the report and those that do use it don’t all use the information in the same way.  As a result having the report may not enable you to predict whether a particular company will insure the property. If you want information on how a C.L.U.E. Report or other similar report may affect your ability to obtain insurance, contact your insurance agent.

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Q.  Are there factors unique to a buyer that can affect their ability to obtain insurance?

A.  Yes, although not used by all insurance companies in determining eligibility for insurance, some companies do review the claims filed by the buyer on properties owned by the buyer during the preceding five years.  This is another aspect of the C.L.U.E. Report database that focuses upon the insured individual rather than the insured property.

Another more controversial factor is the use of Insurance Scores.  Insurance Scores, which are formulas developed by insurance companies in an effort to predict the likelihood of an individual filing claims, are sometimes used to determine to whom or at what price an insurance policy will be issued. 

Insurance scores are not standardized within the insurance industry and both how they are calculated and how they are used is generally not known outside of individual insurance companies.  If you want additional information on how insurance scoring may affect your ability to obtain insurance contact your insurance agent.  

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Q.  Can a seller include a requirement that the buyers demonstrate their insurability as a condition of the sales contract? 

A.  Yes, although not common, such a requirement could be included in an agreement.  However, the specific language of such a condition should be carefully considered.  Check with your real estate agent to find out if any standardized language has been developed in your community and/or consult with your attorney.  As discussed herein the factors used to determine a particular buyer’s insurability will vary from one insurance company to another and can leave questions regarding whether and when such a condition had been satisfied. 

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Q.  Can a buyer include a requirement that property is insurable and/or the insurance be affordable as a condition of the sales contract?

A.  Yes, but the specifics of such a condition should be carefully considered.  Check with your real estate agent to find out if any standardized language has been developed in your community and/or consult with your attorney.  There are multiple factors which might be used to determine a property’s insurability or the affordability of the insurance in such a clause.  The factors used in a contract clause could include, but are certainly not limited to:

• acceptable C.L.U.E. report
• purchaser is satisfied with the insurability of property
• secure binder of property insurance on property
• cost of insurance doesn’t exceed specified threshold

Both buyers and sellers should be aware that there are advantages and disadvantages to such a clause that should be considered.  The advantage of such a contingency is that it may allow the buyer to cancel the transaction if the property proves uninsurable or insurance is unaffordable.  This avoids reliance on a financing contingency and any question regarding its application where the property and borrower would otherwise qualify for a loan.  On the other hand, the inclusion of such a clause may affect the acceptability of an offer, particularly if the offer is being made in a competitive environment.

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Transaction Checklist – Insurance Issues

• Discuss current insurance market conditions with your insurance agent and any problems you may have in obtaining insurance on the new home you may be purchasing.  Contact one or more insurance agents immediately following acceptance of purchase contract by both parties to begin process of obtaining necessary insurance. 
• Review offer to purchase to identify insurance issues/contingencies or need for such contingencies with your attorney
• Obtain commitments to issue an insurance policy from an insurance company in writing and carefully review it with your attorney or insurance agent to determine scope of that commitment.
• Be aware of alternative insurance sources that may be available if a problem develops:
• Know available sources of insurance (i.e., what other insurance companies are in market by calling different insurance agencies in the community)
• Check with your current insurer to determine if they will continue to insure property with new owner
• Check with buyer’s current insurer to determine if that insurer will continue to insure buyer in a new property

Alternative forms of coverage that may allow transaction to proceed (FAIR Plans, Fire & E.C., etc.)

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Mistakes Sellers Must Avoid

Making a mistake in selling a home can cost you hundreds or thousands of dollars in lost profit. Often home sellers make the same mistakes. Avoiding these mistakes is easy and takes little time and effort on your part. Take the time with your home sale and follow the guidelines in this report.

Distress Selling
At times selling quickly is unavoidable. That's when knowing the right techniques to sell your home, without looking desperate and making yourself a target for low bidders, really pays off. Knowing all there is to know about your market before listing will help ensure you are not settling for the first offer through the door.

Best Home in the Neighborhood
Your home is one of your most personal possessions. Don't be blind to flaws and needed cosmetic improvements. This will cause overvaluing of the home, hurting its chances to be sold. Listing with Ruo & Haschig Realty gives you a well informed third eye that will help you price your home at a fair market price.

Home Viewing
Buyers want to view a home on their own time schedule. Unfortunately their time schedule does not always coincide with your time schedule. A key lockbox will allow your home to be shown when you are not around. The lockbox allows authorized agents access to the key to view you home with their clients and customers.  You never know if the one who got away was your next home buyer.

Restrain Emotional Decisions
Don't allow a few hundred dollars that will mean very little to you in the long run, to ruin a sale. Take a look at the big picture and react rationally.  Remember, the first offer you receive is likely to be the best offer.

Make Cosmetic Improvements
Buyers make up their minds within the first ten minutes. First impressions can make all the difference in selling your home. Spending $1,200 on new carpet might add another $4,000 to the price of your home. We will provide an objective point of view. We can provide you with a list of items that will maximize the profitability of your home sale.

Disclose Property Flaws
Property disclosure laws require that sellers fill out Seller’s Statement of Representation, and list any flaws required by the State. If you are unaware of flaws or worse, attempt to cover them up, you risk losing the sale and finding yourself in court. We will inform you as to what needs to be disclosed.

For Sale By Owner (unrepresented sellers)
Most homeowners who decide to sell their own home, do so because they believe they can save the commission. Everything has a price, and selling a home carries a substantial cost. The enormous amount of time and effort required to sell a home often surprises the For Sale By Owner. Furthermore, many costly mistakes will be avoided with our guidance.

Trust Us
Would you tell a physician that you've decided to run your own tests and come to your own diagnosis? By choosing Ruo & Haschig Realty, you can relax and trust our judgment. We are on your side, and we will protect your best interests and make your sale as profitable as possible.

Know Your Market
Most homes that do not sell in 45 – 60 days are priced too high. You need to understand your market and evaluate the value of your home based on fact, not gut instinct or conventional wisdom. We live and breathe the market, just as you know your market for your work place.

Choosing a Realtor Based on Personal Relationships
Home sellers often pick a friend or family member as their agent. Choose an agent with a strong track record and aggressive Marketing Plan. An experienced knows their market well and can generate many buyers. Before you make one of your most important decisions (who to list your home with) you should become as informed as possible. By aligning yourself with Ruo & Haschig Realty, you ensure that all the important issues are handled professionally, and your home sale will be a pleasant experience.

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