Top

General topics
Q. What repairs or remodeling projects are advised prior to putting our house on the market?
A. This gets two answers. One answer is that the decision depends on your particular circumstances and needs. Do you want top dollar for your house? Do you need a quick sale? What are market conditions? Are you in a highly desirable neighborhood? Do you have the resources to make the repairs or consider a remodel? A good Realtor will ask these questions (and more) to help determine the best marketing approach for your home. In some cases, selling the house “as is” might be just as advisable as doing a lot of repairs.

The other answer is more general, and the one that most Realtors assume, without really learning much about your personal preferences. Make the repairs that will make your home more visually attractive to buyers. Repair those things that would “put off” potential buyers if they noticed the house needed it done. View the Staging area of this website for good ideas and a more complete response than allowed in this Q/A forum.

What about remodeling?
This too, depends on your particular circumstances and your home. Does your home have only one bathroom while surrounding homes all have two or more? Realize that buyers typically give their Realtor parameters that include price, minimum square feet, minimum number of bedrooms and bathrooms. So, even if you set a very low price, it won’t insure that your house will be shown, because it won’t even come up on the computer search! Remodeling can be expensive, but not knowing the nature of how to wisely market your home can also be costly. It may be less expensive to add another bath or remodel the kitchen that it would be to try to sell without those changes. Get a Realtor who knows the business and the area to advise you. I also recommend you view the What Pays section of this website to learn how remodeling projects pay off in the greater Portland area.

Q. What can we do to make our home more appealing to buyers?
A. The short answer is, get rid of all cutter and as many of your personal possessions as possible so it looks roomy and neat, yet comfortable and inviting. Clean everything, especially the kitchen, bathrooms and carpets. If repainting the interior, choose neutral colors. Repair where it is obviously needed. A much more detailed discussion of this topic can be found in the Staging area of this website.

Another point, less often considered and yet very important is how and to whom will the home be marketed! Is it best presented to appeal to a family with young children, or to a couple who loves to cook and entertain, or to an investor?

Let me give you a example outside of the Real Estate field, and then come back to your home. Perhaps you’ve noticed that some good movies don’t succeed at the box office. Sometimes a movie is promoted as a comedy but in fact, other than a few good laughs, the film is really a thoughtful, well acted drama. The teens who went, expecting a good laugh are disappointed. Those who appreciate fine acting and well written lines might have loved the movie, but they probably never went to see it, because they thought it was a comedy! The film slips into oblivion.

This isn’t what you want to have happen to your house! Your home has to be marketed to the people who want that kind of home, and they have to know that your home offers it! Like the movie, it needs to be promoted to the right “audience/buyers”, and it must be done in words and in ways that appeal to that particular type of buyer!

So, in addition to what you can do to make your home more appealing, make sure you pick a Realtor who knows about strategizing for particular markets and buyers! View the marketing area of this website for a more detailed discussion about this important topic.

Q. Can we take the chandelier (blueberry bushes, mirrored cupboard, etc.) when we go?
A. Yes. And no. The standard Oregon Real Estate contract usually states that all fixtures stay with the property. A fixture is anything that is “affixed” and not usually moved. That is, a framed picture that is hung on a hook or nail and readily moved is considered personal property and goes with you when you move. The light fixture that is wired to the ceiling doesn’t readily move and is considered part of the property. Plants in the yard don’t move, and stay with the property. A bookcase that is hung on the wall stays, while a bookcase that is a moveable piece of furniture moves with you.

However, anything can be kept, provided you and the buyers agree and it is written into the contract. In some cases, it may be easier to remove and replace the item prior to putting your house on the market. Ideally, you should notify your Realtor of those items you wish to keep prior to your home being listed in the Multiple Listings.

Q. What if we aren’t satisfied with our Realtor’s services?
A. If your home is currently listed with a Realtor, please do not consider this information a solicitation for your business or an attempt to get you to change Realtors. However, I’ve been asked this question enough times that I want to include the answer here.

Have you already signed anything that commits you to work with a specific Realtor? Particularly, have you signed a listing agreement? If not, you (probably) are not obliged to work with any particular Realtor yet, and can simply call someone else.

If you have signed an agreement and are dissatisfied, I recommend you talk to the Realtor and specifically state what you would like to have changed. The fact that the Realtor hasn’t run an ad every Sunday or your house hasn’t sold as promptly as you had hoped may not be grounds for changing agents or companies. Tell your agent specifically and exactly what your concerns are, and see what can be done.

If you remain dissatisfied, contact the principle broker of the company/office with which your home is listed. The broker may be willing to switch the listing to another agent within the office whom you might find more compatible.

Most listing contracts are for a specified length of time, and outline the procedure (and/or consequences) for withdrawing prior to the expiration. Regardless of what is or isn’t stated, your agent (and the principle broker) may be willing to release you from the contract.

Top

Negotiations
Q. What if we don’t like an offer that gets presented?
A. You have two options. You can reject the buyer’s offer and walk away from negotiations. You can create a counter offer that incorporates the parts of the buyer’s offer which you found acceptable and modifies other points to make it more attractive and acceptable to you as seller. However, the buyer is not obliged to accept your counter offer, and once you’ve presented the counter offer, they are also not bound by the original offer.

Q. How long do we have to decide on an offer once it’s been presented to us?
A. The typical contract will state how long the buyer is giving the seller to decide. Sometimes this is a matter of hours. Sometimes it can be a week! The length of time is determined by the buyer’s needs and current market patterns.

Q. What is a contingent offer?
A. A contingent offer is a promise to buy “if” all goes well. Almost all offers have some kind of contingency. For example, most are contingent upon approval after an inspection, or dependant upon the buyer getting the loan and upon the lender approving of the house. Less commonly, a deal can also be contingent upon an inheritance or a business development or any number of things. Generally, when someone speaks of a contingent offer, they are referring to a deal that is contingent upon the sale of the buyer’s current home. The offer states: “when our current home gets sold, we promise to buy your house.” Such offers often are accompanied by an agreement to either withdraw the contingency (and move forward with the deal immediately) or step aside (withdraw from the deal) should the seller get another offer they wish to accept.

Q. What are the advantages and disadvantages to accepting a contingent offer?
A. There are some advantages to accepting an offer contingent upon the sale of the buyer’s home. First off, it’s reassuring to know that you have a buyer who really wants your home! Having a contingent offer on your property may be of benefit in approaching a lender or another seller about a house you want to buy. The seller can continue to try to find another buyer who can close the deal sooner, but also have a sale that will (sooner or later) go through if they don’t find another buyer before then.

The disadvantage is that the status of your home changes from active (available) to contingent (almost unavailable) in the Realtors’ Multiple Listing Service. The majority of agents don’t bother to show homes with a contingent status. Most agents don’t want to invest the considerable amount of time the paperwork requires (whether or not a deal transpires) only to have to start all over again when the contingent buyer removes the contingency and takes the house! Nor does an agent want their client to fall in love with a house that really isn’t available, because if the first buyer removes the contingency, their client goes through a minor (or major) grief process in which they compare every other house (unfavorably) to the “one that got away”.

The question is: “how much confidence should be placed in the contingent buyer?” What kind of house are they selling? What neighborhood is it in? How hot is the market? Is their home priced to sell? It’s possible that the contingent buyers won’t be successful in getting their home sold. Your Realtor can help you evaluate the contingent buyer, their home, their Realtor, and the market. All these things influence the decision of whether or not it is in your best interest to accept a contingent offer.

Q. If we reject an offer, do we still owe the Realtor a commission?
A. It depends on the terms of your listing agreement with the Realtor/ Realty Company. Most contracts state that if you are brought a full price offer by a qualified buyer, you owe a commission (whether or not you accept). If the offer isn’t full price, and/or the buyer isn’t qualified, you wouldn’t owe a commission.

Q. What if the buyer demands a lot of repairs we don’t want to make?
A. You don’t have to make any repairs, but to refuse to do so might cost you the deal. Assuming you want to keep the deal alive, and the buyer’s requests are in line with typical Real Estate procedures, you need to handle this situation quite delicately. This is where a Realtor with good negotiating skills is of great value. Generally speaking, both parties want to continue with the deal, they just need to proceed with caution in finding a middle ground that is acceptable to both parties. At any point where the either party responds with a request or an offer that one party finds unacceptable, the party to whom the offer/request has been presented has the legal right to walk out of the transaction (usually with the buyer keeping the earnest money). So, be sure you understand each step of the negotiation process, and be ready for whatever might transpire!

Q. When is a deal a deal, and when can they (or we) still back out?
A. At each round of negotiation, there are points where either party can back out. At each stage, the party making the proposal /offer/ counter offer is obligated to proceed. The party receiving the proposal/ offer/ counter offer can back out and walk away.

For example, the Jones make an offer. They are bound to that offer until the Smiths respond with a counter offer. Once the Smiths’ counter offer is presented, the Jones are no longer bound to their original offer, nor must they accept the Smiths’ counter offer. They can walk away. But, if the Jones counter the Smiths with a different counter offer, the Jones are on the hook again. The Smiths are no longer obliged to follow through on their (first) counter offer, and the Smiths can walk away.

So, during the initial offer/counter offer stage there may be lots of opportunities for one or the other party to withdraw.

If the contract was contingent upon a property inspection, there is usually another round of negotiations that follow the inspection. Again, any party presenting a proposal or request is bound while the party receiving it is not.

After all the contingencies have been removed, the deal is typically fairly certain. However, most contracts are contingent upon the buyer being awarded a loan. That’s a big contingency that isn’t complete until the last moment! So be sure your Realtor has reviewed the buyer’s qualifications before you accept the initial offer!

Top

Earnest Money
Q. If the deal falls through, do we get the earnest money?
Q. Under what circumstances are we awarded the earnest money?
A. If the buyer withdraws at a time or in a manner that is not legally acceptable the seller is awarded the earnest money. Forgive the vagueness of that answer, but the specifics are beyond the scope of this forum. The buyer has several opportunities to withdraw and retain the earnest money. For example, they can withdraw at each round of negotiations, as described in the section immediately above. If they were given any disclaimers (instead of disclosures) they have a set amount of time in which to withdraw. If something appears on the title report (easements, right of ways, special tax assessments, etc) which they did not know about at to which they object, (and which the seller cannot mitigate,) the buyer has a certain amount of time in which they can withdraw.

The seller is awarded the earnest money deposit if the buyers withdraw because they changed their minds and just want out. If the deal falls through because the buyers grossly misrepresented themselves to the lender or lied about having the cash needed for the down payment or did not cooperate in a timely manner required by the situation, the seller could be awarded the earnest money.

All of the above situations are examples, and should not be construed as absolute law. Every transaction is subject to the terms of the contractual agreements. These comments are meant to reflect common circumstances so you have a general idea of how the process works. Make sure you have a reliable Realtor who can guide you through the process and protect your interests!

Top

Inspections
Q. Who pays for the inspection?
A. The inspection is typically a contingency placed by the buyer. Therefore, the buyer selects the inspector and pays for the inspection. The inspector works for the buyer, and the inspection report belongs to the buyer. The seller usually doesn’t see the report.

Q. What if the buyers request a lot of repairs we don’t want to make?
A. As the seller, you are not obliged to do any repairs (unless it is specifically stated in the original contract). However, if the buyer requests repairs, and an agreement cannot be reached about the repairs, the buyer can usually withdraw from the deal with the earnest money intact. Your Realtor can advise you which repairs are reasonable for you to consider. Typically, repairs that have to do with stability or safety of the house should be seriously considered. Items related to cosmetics are generally not required.

Q. Who pays for the repairs?
A. It all depends on what is agreed to as part of the negotiations. Generally speaking, the repairs are made and paid for by the seller. However, it can be handled by a cash credit being given to the buyer at closing with the repairs being done after the buyer has possession of the property. The repairs can be paid partly by the seller and partly by the buyer. You want a good negotiator representing you when the inspection calls for repairs.

Q. Who does the repairs?
A. Who does the repairs and when they get done is determined by the terms negotiated. For example, the buyer may specify that repairs are to be done by licensed contractors, or may state they want to choose from three bids obtained by the seller. If it is not clearly stated in the repair addendum, it is the seller’s decision.

Top

Appraisal
Q. Do I need to get an appraisal?
A. No. “Need” is the key word here. You don’t need to get one. In most cases, it is an unnecessary expense. If having an appraisal done would help you feel more confident in setting a price, of course, get one! However, a comparative market analysis of your home (provided free by most Realtors) can be used to realistically determine market value. Even if you get an appraisal before the sale of your property, the buyer’s lender will undoubtedly insist upon another appraisal, done by one of the lender’s appraisers.

Q. When is the appraisal done?
Q. How much does it cost?
Q. Who pays for it, and when?
A. The appraisal is a condition imposed by the buyer’s lender, to be sure the bank does not lend more than the value of the house. It is usually ordered sometime after the inspection and is paid for when it is ordered or at closing by the buyer. If you decide you want a separate appraisal, or wish to have one done prior to marketing you home, you can expect it to cost around $300-$500.

Top

Escrow and Title
Q. What is escrow?
A. Escrow is service (usually handled by a Title Company) which acts as a neutral third party, handling money for both sides of the transaction. Escrow releases money only when all the terms of the contract are satisfied, and only according the to terms stipulated in the contract. This protects all parties concerned.

Q. What need do I have for a Title Company?
A. A title search assures the buyer that you have legal right to sell the property and that there will be no other claims against the property after they have taken possession. It also helps to assure that the buyer is notified of all easements or agreements that transfer with the property. This notification will prevent the buyer from being able to come back to you after the purchase and insist they didn’t know or understand about the sewer easement or that power lines crossed your property or anything else that was reported in the Title Company’s report.

Q. Who pays for the title search and for title insurance?
A. The seller pays title insurance that covers the seller’s interest.

Q. Who decides what escrow company and/or Title Company to use?
A. Typically, this is decided by the listing agent and/or the seller. If you have a preference, be sure to notify your Realtor at the time you sign the listing contract. Otherwise, the Realtor will simply choose the company with which he/she is most accustomed to working.

I hope these Q/A’s helped clarify some of your concerns about the selling process. If you have more questions, I’d be happy to help you.

Give me a call today (503-319-4777)
or e-mail me at RealtorInquiry at AmoveInTheRightDirection dot com

I regret that in an effort to foil spammers, who have previously high-jacked my e-mail address, I have removed the automatic link to my e-mail. Please type the address, using the @ symbol to replace the word at, and use the period key to replace the word dot in the e-mail address above. Do not leave spaces. They are used here only to help you read the address.

Top