THINGS TO KNOW WHEN SELLING YOUR HOME

Posted in: Real Estate- Dec 04, 2012 Comments Off on THINGS TO KNOW WHEN SELLING YOUR HOME

So you’ve decided to put your home up for sale. Perhaps you need a bigger place than your current two-bedroom bungalow or condo. Or you want to downsize for financial reasons or because your children have left home.

One of the first things you need to know is how much your home will likely sell for. You could get a professional appraisal based on comparable sales in your neighbourhood and the cost to replace your home. But most people simply ask two or three reputable realtors to evaluate their home. They will typically give you a written evaluation for free.

If you have a mortgage, contact the bank to find out how much you still owe. Ask too if a buyer can assume your mortgage or whether you have to pay a penalty if you pay the mortgage off in full. Most banks will waive any penalty if the buyer assumes your mortgage or if you “transfer” the existing mortgage to your new home.

Assuming you want a realtor to sell your home – rather than trying to sell it yourself – choose one you feel comfortable working with. He or she will typically ask you to sign a standard multiple listing agreement, provided by your local real estate board, meaning that your home gets broad exposure.

The agreement specifies the price and terms on which you are willing to sell your house. Your agent might want a term of six months for the listing, but you can request a shorter period. If your house hasn’t sold by then, you can extend the term of the agreement or find a new agent.

Amongst other terms, the listing agreement sets out the amount of the commission you’ll pay, usually 7% on the first $100,000 of the sale price plus 2.5% or more on the balance. Read the fine print so you know the basis on which your commission will be paid. For example, if you sell the house yourself while the listing agreement is in effect, your agent may still be entitled to a commission if this is a term of the agreement. Also, most listing agreements state that a commission is still payable if you sell your home after the listing has expired if the realtor’s efforts contributed to the purchaser’s decision to buy your property.

When you get an offer, read that over carefully. If you’re not satisfied with it, make a counter-offer, for example, to change the price.

Also feel free to change or clarify any terms. For example, if the offer says “subject to the purchaser obtaining satisfactory financing,” cross that out and have the buyer specify the needed amount for the mortgage, interest rate, monthly payments and so on. Otherwise, the buyer may try to back out of the deal on the excuse that he or she couldn’t get “satisfactory” financing. And make sure the buyer has a limited time within which to remove the financing and other conditions. While the buyer is checking the conditions out, your home will be off the market.

If you’re unsure about any terms, have your lawyer review the offer or counter-offer before you sign. Once you and the buyer both sign, it becomes a binding contract of purchase and sale (subject to the purchaser removing any conditions they have included).

 

This column has been written by Janice Mucalov LL.B as part of “You And The Law”. It provides information only and must not be relied on for legal advice. Names of the parties in reported cases have been changed or removed to protect their identity. Lawyer Janice Mucalov is an award-winning legal writer.

New Website!

Posted in: News- Dec 12, 2011 Comments Off on New Website!

Cobbett & Cotton is proud to announce the launch of our new website! We hope you like it.