Here is Our 12 Step Summary of what’s involved in selling your house.
- Consult with a Real Estate Broker to determine price and marketing plan*
- Determine your Timeline
- Prepare the Property for the Market
- Sign Listing Agreement and Disclosures
- Allow Showings
- Review offer(s) with your Real Estate Broker
- Finalize Purchase Agreement
- Allow Inspection and Complete Attorney Review
- Allow Appraisal
- House Clean Out and Moving Time
- Allow Final Walk-Thru
- Closing
*NOTE – In Illinois, Real Estate Agents are officially called Real Estate Brokers. We use ther terms “agent” and “broker” inter-changeably in this document.
Here are more details about each step…. bearing in mind that these 12 steps assume the buyer of your house would be getting a loan. Although similar in many ways, a cash transaction involves slightly different steps.
Consult with a Real Estate Broker
to Determine Price and Marketing Plan
We are not suggesting this just to be self-serving, so let’s look at this.
It is true that you can sell your house “by owner” and if you have done it before, understand the pros and cons of using an agent or not, and really know everything involved to proceed successfully … then good for you, and we wish you all the best! No need to read any further 🙂
For the rest of you, please continue to read. In general, the down side of using an agent (a.k.a. broker) is that you have to pay them.
But consider: You are paying them for a service – a service which not only saves you time, energy, and hassle, but which ultimately might result in more money in your pocket when all is said and done.
This is because you may not know critical things about pricing, legal issues, negotiations, process and advertising – all of which come into play if you want to sell for the best market price you can get.
That being said, if you live in a high demand area with lots of properties for sale, and a seller’s market is really going on – you may get lucky with a sale by owner, and score a fast, clean and easy sale. It is possible — just not likey for most sellers.
So for now, we will look at what’s involved, assuming you would prefer to have professional assistance. So that means you need to find someone.
Finding and agent is not hard — there are many of them. You may even know someone in this line of work.
If you do not already have someone you prefer to work with, it is a good idea to meet some people you are considering in person (or via zoom).
First and foremost you want to choose someone you are comfortable with and feel you can really trust. Your relationship with this person can become rather personal. You agent will get to know your tastes, your financial situation regarding the sale, your reasons and plans for selling, and of course the insides of you home down to the details of attics and closets.
Next, you will want to find someone who has the time and energy to focus on YOU. Some agents are so in demand that once you sign on with them, most interaction between you and them is actually through their assisants. This may be fine – it just might not be what you thought you were getting.
You want an agent that is experenced enough to have seen a big variety of problems and issues. When you interview prospective agents, ask them for some examples of what they have encountered, how they responded, and what resulted.
You also want an agent that can help you through all the steps of the process — someone that helps to educate you, and makes it all as easy as possible for you, because – make no mistake – it is not terribly easy and fun to sell your house!
And you will want to find out how they will come up with a good price for your house, and how they will market it. Try to see how responsive to you they will be during the whole process. And see what they say about getting your house ready for selling.
Just having some interviews where you can discuss topics like these will give you a good idea of the things you need to think about. It will help prepare you for going forward.
Then when you are ready, decide who to go with and set a meeting to begin really working together.
Determine your Timeline
Now it is time to get serious. You selected an agent to work with, so what now?
You need to take a good look at your house and situation. There are a number of things that will affect how you will want to proceed.
First – how quickly do you need to sell and move? The less time you have to prepare, the less flexibility you might have concerning the price you can expect to get for the house.
Your price will depend on things like the condition of your house vis a vis other houses around you that are for sale. Is yours clean, updated and attractive to most people who may be looking?
For what it is worth, shoppers today look for something that is “move-in ready” because they do not want to spend time and money making their new house look how they want. And often that means they want things like the kitchen and bath to reflect current fashions for interior design.
How does your house stack up? Might you need to do some remodeling?
At the very least, you will want it very, very clean and uncluttered. This can be daunting, so you will want to discuss options and plans with your agent, who should be able to help and guide you here.
As part of the process of deciding how to ready your house, you need to evaluate the likely price of your home “as is” without doing much to it except cleaning and de-cluttering as much as possible.
Then think about possible remodeling, painting or other improvements that can cost relatively little or quite a bit. Once work is done and money spent, will you be able to charge enough more for the house to make it worth while?
This is an important question and you will want to discuss it carefully with your agent.
Along with this you need to look at your mortgage and what you still owe on the house. Is the lowest likely price you might expect to get from the sale enough to cover what you owe? If not – you may have to bring money to the table at closing to cover the difference. Can you afford that?
Additional things you will want to make sure you check on include legal matters, such as title and any possible liens on your property. If there is a problem getting clear title down the road, it can possibly derail the whole sale. Then you would have to start all over again, which will feel very painful.
After sorting all these things out, you may find you need to make a plan to sell later – maybe in six months or more down the road.
But hopefully things look good and you can forge ahead.
Prepare the Property for the Market
Having figured out what you need to do, you will get to it as soon as possible.
At the very least, even with no other planned changes, you will want to do these 2 things:
- De-clutter
- Professionally clean
The most complete way to de-clutter is to actually move out and leave only enough furniture or decoration in the house to “stage” it, or make it look attractive.
This is not feasible for most people, so the next thing you want to do is to sell or get rid of whatever you do not plan to keep when you move. For items you want to keep, pack them up now for the move unless you really need them until you move. Store everything you can in an area that is out of the way.
TIP!
You have to pack at some point anyway, right? Get a head start on it now, when it will actually benefit you during your selling process.
The other most important thing to do before selling is to make your house as immaculately clean as possible. Consider having professional cleaners come in and really get it clean.
You will want to do the cleaning, of course, AFTER you have done any painting or other remodel work that you decided would help with the sale.
As a side note, one of the least expensive, most impactful ways to freshen up your house is to have all the rooms painted in fashionable neutral colors.
Other things that are important include fixing broken things, like running faucets and faulty electrical outlets. You will ideally want to have things like electric and plumbing all be up to code so that when the house is inspected you do not run into issues.
And finally – do not forget that curb appeal is very important for attracting potential buyers. Be sure to attend to outside repairs on the house, and clean up the yard and walkways. Investing in a bit of landscaping might also brighten your place up a lot.
Sign Listing Agreement and Disclosures
So now the fun begins!
You have gotten your house in its best shape possible and it looks great!
It is time to let the world know that you are ready to sell. If you have a high quality agent working with you, your agent will arrange to get professional photos taken so that the first look people have of your house via the internet will be showing it at its best.
Your agent will get the house posted with a multiple listing service or MLS. In Illinois this is the service called Midwest Real Estate Data (MRED).
The advantage of listing with an MLS is that it collects all listed properties for sale and is the central point that feeds listings out to public sites like zillow, etc. This is your usually your most powerful means of advertising your house for the widest range of people to find.
In addition to this, your agent will normally provide other means of advertising more locally. This will include getting a “For Sale” posted in front of your house (if it is allowed). This lets random people driving by see that you are selling.
Often your agent will also make up some listing sheets or brochures that advertise your house. Additional advertising will include use of social media posts to get the word out.
And even though ads printed in newspapers, etc. are not as common or critical these days, sometimes they can be useful, and your agent might make those happen.
Allow Showings
Now comes a part of the process that most people find very disruptive and unpleasant, despite knowing it must be done. This is the time when you allow people to come in and look over your house.
Typically what happens is that you decide on days and times that you will allow showings, and your agent will allow scheduled showings in those times. Your agent communicates with the people (usually through their own agents) who want to see your house, and confirms things with you also. This lets you be prepared.
Before a scheduled showing, you will want to make sure the house looks clean and tidy and ready to show. For example, remove dirty dishes and clean counters, make sure bathrooms look clean and fresh, and generally put away any clutter.
Think about how YOU would want a house to look if YOU were coming in as a buyer. Then do your best to make it look good!
And then usually you will want to arrange it so that you and your family (and even pets if possible) are not in the house during the showing.
So you can see how this process of tidying up, and removing yourself from the premises can get old really fast.
But it’s got to be done; and the more people who see it, the sooner someone may decide they want to buy your house!
Review offer(s) with your Real Estate Broker
Hopefully all your hard work has resulted in an offer!
(BTW – if you got no showing requests in the first week, it is an indicatiion that you are priced too high for the current market. And additionally – if you get a lot of showings, but no offer in a reasonable time, it also is an indication of being over-priced.)
Assuming an offer comes in, lots of things happen. Your Real Estate Broker will first let you know the offer came. Then it is time to discuss the offer with you and decide on how to proceed. If the offer is not what you hoped for, your agent will negiotiate on your behalf. This could become a bit of a back and forth process, but hopefully you and the buyer will come to an agreement.
Finalize Purchase Agreement
We are now at the point at which both sellers and buyers have agreed to terms concerning the sales of the house. All details should be reflected in the contract that has been signed by both parties.
Now is the time when you need to engage a lawyer to review the contract. If you do not have a lawyer by now, or know of a good real estate attorney, your agent should be happy to recommend some good ones. Most good real estate attorneys in Illinois will typically work for a flat fee that you agree to up front.
Your lawyer may recommend some changes to the contract. Changes to the initial offer might be minor and only require putting your initials by changes reflected in the contract. If many things are changed, sometimes a fresh copy of the contract with all agreed upon terms will be signed.
Your agent will make sure that you, your lawyer, and the buyer’s agent and lawyer all get a copy of the contract so that the attorney review period can proceed.
Allow Inspection and Complete Attorney Review
With a signed contract we begin the attorney review period of typically 5 days.
During this time, the buyer most likely will have a formal inspection done in order to make sure there are no big issues or expensive repairs needed that were not already known about or obvious. If there is an issue, there may be some negotiation between the lawyers about how to resolve things.
Read more about how inspections work from the buyer perspective here.
Note that at any time during this attorney review process, the buyer can decide to back out of the contract for any reason.
In any case, once the attorney review ends, the sale is well on its way. But things can still go awry, so do not rest too easy!
Allow Appraisal
This step happens usually because the buyer is getting a loan. In order for the loan to go through, the price of the house is expected to appraise.
This means that the lender will send out someone to evaluate the house and determine what they think the going price is.
Why is this a problem?
Well if the buyer has agreed to buy the house for a price that is higher than what would be expected for the location and the house condition, the lender will be concerned that the loan amount is too risky.
What if the new buyer, after a while, needs to sell but the new market price for the house will not even cover his loan?
The lender sees this as a big risk and may ask the buyer to make a larger down payment and thus reduce the loan amount.
If the buyer cannot afford that extra money up front, the deal will fall apart.
Sometimes, however, there might be no appraisal.
This can occur if the sale involves a cash offer. An appraisal may or may not get scheduled, depending on the buyer’s confidence that the market justifies the high price.
In any case – if the house does not appraise for the price of the sale, it is usually grounds for voiding the contract.
If the buyer cannot get the needed loan, they may want the seller to agree to a lower sale price. If no agreement is reached, the deal fails and the seller is back to looking for another buyer.
House Clean Out and Moving Time
Assuming all issues with inspections, appraisals or anything else get resolved, everything moves forward.
Then, close to the closing date, once critical paperwork and funding details are all in order, the lender will issue a clear to close to the buyer.
This means everything is ready for the sale and it is time for the seller to move out of the house. You want to be fully moved out before the buyer has the final walk through.
Allow Final Walk-Thru
This is a step the buyer along with the buyer agent will typically perform, right before the closing.
They will inspect the house and make sure that everything still works, that nothing unexpected has been removed, and that there is no damage to the house that was not there when the buyer originally looked at it.
It is best to have the house thoroughly cleaned for the walk-thru, ideally by professional cleaners, so that there is no cause for additional negotiating at the closing.
You also must make sure to give all keys and remotes for the house over to your selling agent so that they may be converyed to to buyer.
Closing
Finally, you get to the end!
Some sellers go to the closing but most do not. The seller’s lawyer should arrange everything with you ahead of time (like signatures etc.) so that you have the option to attend or not.
Seller agents often go to make sure all goes well and to turn over the keys to the house. If they do not attend, they make arrangements for the transfer of keys.
Congratulations! Now you can have your life back and proceed with the next phase of your life!
Questions?
Contact us – we would love to help you understand more!
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