An apology here - it's been a while since the last installment primarily because I make a commitment to the writing process that takes a while to fulfill. Like a phone call to a friend I haven't seen in a long time, I want to have enough time and feel relaxed about the time constraints to enjoy the visit. For whatever reason, real estate has been popping the past month. New listings, new clients, closings - so much to do! It's been great - but not for my blog.
What I want to do here is make each "chapter" (and I do feel as if I'm writing a book) shorter and more concise. That's difficult for me, and one of the reasons I enjoy blogging is because I have a natural stream of consciousness style. If I leave things out, which I will have to do or never get it written, feel free to e-mail me and ask for more information.
Now on to your decisions as a home-seller. Once you've signed all the paperwork and agreed to the starting date, there are still things that influence the sale of the home, some of which need to be thought out prior to the listing.
Question: Do I sell it with the furniture? If you are down-sizing, that lovely huge cherry wardrobe you purchased years ago at Ethan Allen looks too large to move and will take up the entire bedroom in your new condo. But it still looks fantastic, you valued it and kept it beautiful, it fits so well in that corner...do you include it with the house?
Discussion (not the definitive answer!): I have seen furniture - the entire household - sold with the house a few times. As a Realtor, I am not in the furniture business. I can't put a value on anything, but I know people purchasing a house often feel they are purchasing the style which comes from a great decorator. Take away the furnishings...the house looks different. And beware! Any house you buy with furniture in it will look vastly different without it. But as one agent said to me, "It's used furniture!"
There is a value to turnkey homes. This usually happens in a summer home when people want to get into it and not spend a great deal of time furnishing it immediately. Fifteen people are coming for the lighting of the lake on the 3rd and you close on the 2nd. It's good to keep those five beds, the dishes, the grill on the deck in that case. But my feeling is that increasing the price of the home to cover the furnishings does not make the home worth more. And trust me - if buyers want things to stay they will ask. I believe in options - offer the furnishings to make the house more attractive to someone who wants it but be prepared to remove everything if they don't. And remember also - minimal furniture makes a house show better.
Question: Do I offer to hold the mortgage? I could use the steady income, and if anything happens I can always take back my property. If they put a lot down then that's assurance they won't walk away and I would keep the down payment if they do. Banks aren't offering much in savings accounts, I could give an attractive rate, where am I going to put the money after the sale anyway? Might help with capital gains.....
Discussion: Here come Joshua and Delilah, a lovely young professional couple from Oneonta. They want to buy your home. You offer the mortgage, but want to make sure they are qualified, so you check their credit. It's good, but you can't check as thoroughly as a bank does - so you may never know for certain if they are qualified. Do you really want to think about this at 4 AM in two years when their payment is late? What if they do walk out, having had a party to end all parties and burned the deck on that grill you left them? How easy is it really to get your property back when they've gone to the Cayman Islands to open a hot dog stand?
Again, there is a time and place for everything. If you are selling land, often "holding paper" is one of the few ways people can buy the land. I have tried for years to find a consistent mortgage broker who will mortgage land and so far, I've been unsuccessful. Most people use their home equity line of credit to finance land, or simply pay cash. But if you want to offer taking back the first mortgage in any case, speak with an attorney first and ask the hard questions.
Options, options - next time, pricing!