Some 5 million existing homes are sold each year, and while each transaction is different every owner wants the same thing - the best possible deal with the least amount of hassle and aggravation.

Unfortunately, home selling has become a more complex business than it used to be. New seller disclosure statements, longer and more mysterious form agreements, and a range of environmental concerns have all emerged in the past decade.

More importantly, the home-selling process has changed. The Internet is now how over 80% of all homebuyers start their home search. Having a professional, informative and descriptive Internet marketing campain is definately the key to your success.

Sign up here first for a FSBO Property Site Builder account - It's FREE.

Are you ready?
The home-selling process typically starts several months before a property is made available for sale. It's necessary to look at a home through the eyes of a prospective buyer and determine what needs to be cleaned, painted, repaired and tossed out.

Ask yourself: If you were buying this home what would you want to see? The goal is to show a home which looks good, maximizes space and attracts as many buyers - and as much demand - as possible.

While part of the "getting ready" phase relates to repairs, painting and other home improvements, this is also a good time to ask why you really want to sell.

Selling a home is an important matter and there should be a good reason to sell - perhaps a job change to a new community or the need for more space. Your reason for selling can impact the negotiating process so it's important to be cognisant of the reasons you are selling BEFORE you start the selling process.

When should you sell?
The marketplace tends to be more active in the summer because parents want to enroll children in classes at the beginning of the school year (usually August). The summer is also typically when most homes are likely to be available.

Generally speaking, markets tend to have some balance between buyers and sellers year-round. In a given community, for example, there may be fewer buyers in late December, but there are also likely to be fewer homes available for purchase. So, home prices tend to rise or fall because of general demand patterns rather than the time of the year.

How do you improve your home's value?
The general rule in real estate is that buyers seek the least expensive home in the best neighborhood they can afford. In terms of improvements, this means you want a home that fits in the neighborhood but is not over-improved. For example, if most homes in your neighborhood have three bedrooms, two baths and 2,500 sq. ft. of finished space, a property with five bedrooms, more baths and far more space would likely be priced much higher and likely be more difficult to sell.

Improvements should be made so that the property shows well, is consistent with the neighborhood and does not involve capital investments, the cost of which cannot be recovered from the sale. Furthermore, improvements should reflect community preferences.

Cosmetic improvements - paint, wallpaper and landscaping - help a home "show" better and often are good investments. Mechanical repairs - to ensure that all systems and appliances are in good working condition - are required to get a top price.

Ideally, you want to be sure that your property is competitive with other homes available in the community. We will show you in the following pages exactly how to get prepared and sell your home. Don't worry, people do this everyday, your no different and your house WILL sell, just have faith in the process and you will be fine.

A house that "sparkles" on the surface will sell faster than its shabby neighbor, even though both are structurally well-maintained.

From experience, we know that a "well-polished" house appeals to more buyers and will sell faster and for a higher price. Additionally, buyers feel more comfortable purchasing a well-cared for home because if what they can see is maintained, what they can't see has probably also been maintained. In readying your house for sale, consider:

• how much should you spend
• exterior and curb appeal
• preparing the interior

How much should you spend
In preparing your home for the market, spend as little money as possible. Buyers will be impressed by a brand new roof, but they aren't likely to give you enough extra money to pay for it. There is a big difference between making minor and inexpensive "polishes" and "touch-ups" to your house, such as putting new knobs on cabinets and a fresh coat of neutral paint in the living room, and doing extensive and costly renovations, like installing a new kitchen. Your REALTOR®, who is familiar with buyers' expectations in your neighborhood, can advise you specifically on what improvements need to be made. Don't hesitate to ask for advice.

Maximizing exterior and curb appeal
Before putting your house on the market, take as much time as necessary (and as little money as possible) to maximize its exterior and interior appeal. Tips to enhance your home’s exterior and curb appeal:

• Keep the lawn edged, cut and watered regularly.
• Trim hedges, weed lawns and flowerbeds, and prune trees regularly.
• Check the foundation, steps, walkways, walls and patios for cracks and crumbling.
• Inspect doors and windows for peeling paint.
• Clean and align gutters.
• Inspect and clean the chimney.
• Repair and replace loose or damaged roof shingles.
• Repair and repaint loose siding and caulking.
• In Northern winters, keep walks neatly cleared of snow and ice.
• During spring and summer months consider adding a few showy annuals, perhaps in pots, near your front entrance.
• Re-seal an asphalt driveway.
• Keep your garage door closed.
• Store RVs or old and beaten up cars elsewhere while the house is on the market.
• Apply a fresh coat of paint to the front door.

Maximizing interior appeal
Enhance your home’s interior by:

• Giving every room in the house a thorough cleaning, as well as removing all clutter. This alone will make your house appear bigger and brighter. Some homeowners with crowded rooms have actually rented storage garages and moved half their furniture out, creating a sleeker, more spacious look.
• Hiring a professional cleaning service, once every few weeks while the house is on the market. This may be a good investment for owners who are busy elsewhere.
• Removing the less frequently used, even daily used items from kitchen counters, closets, and attics, making these areas much more inviting. Since you're anticipating a move anyhow, holding a garage sale at this point is a great idea.
• If necessary, repainting dingy, soiled or strongly colored walls with a neutral shade of paint, such as off-white or beige. The same neutral scheme can be applied to carpets and linoleum.
• Checking for cracks, leaks and signs of dampness in the attic and basement.
• Repairing cracks, holes or damage to plaster, wallboard, wallpaper, paint, and tiles.
• Replacing broken or cracked windowpanes, moldings, and other woodwork. Inspecting and repairing the plumbing, heating , cooling, and alarm systems.
• Repairing dripping faucets and showerheads. Buying showy new towels for the bathroom, to be brought out only when prospective buyers are on the way.
• Sprucing up a kitchen in need of more major remodeling by investing in new cabinet knobs, new curtains, or a coat of neutral paint.
  

Before you put your home on the market, there are some things you can do to differentiate your house among the competitors.

When preparing to put your home up for sale, your first concern is the home's exterior. If the outside, or "curb appeal" looks good, people will more than likely want to see what's on the inside. Keep the lawn and landscape nicely manicured. Trim the bushes and season permitting, plant some flowers. Be sure your front door area has a "Welcome" feeling. A fresh coat of paint on the front door looks great.

Of all the rooms inside your home, pay special attention to the kitchen and bathrooms. They should look as modern, bright and fresh as possible. It is essential for them to be clean and odor free. A fresh coat of paint just may do the trick. Have any leaky faucets taken care of. A call to a plumber is a wise investment.

Since you want your home to look as spacious as possible, remove any excess or very large furniture. Make sure that table tops, dressers and closets are free of clutter. Don't use your garage, attic, or basement to store these extra things. These areas also need to have the impression of space. Instead, put them into storage. Make sure walls and doors are free of smudges and look for anything that might indicate a maintenance problem, such as cracked windows, holes in the wall or stained ceilings.

Finally, if your basement shows any signs of dampness or leakage, seal the walls.

Quick tips for showings:

• Keep counter tops cleared
• Replace all burned out lightbulbs
• Open all drapes and window blinds
• Put pets in cages or take them to a neighbor
• No dirty dishes in the sink
• No laundry in the washer/dryer
• Clean or replace dirty or worn carpets
• Put on soft music
• Burn wood in the fireplace on cold days, otherwise, the fireplace should be clean

Always look at your home from the buyer's point of view. Be objective and be honest.

Setting the Stage Sells Your Home

The age-old observation that "you never get a second chance to make a first impression" certainly applies when it comes to attracting buyers to a for-sale home.

Making a good first impression can mean the difference between receiving serious offers for your home or being subjected to months of lookie-loos dropping by but never buying.

How can you ensure that your home will make the best impression possible? Here are six tips for savvy home sellers:

1. Focus on curb appeal. The outside of your house can be the source of a very good first impression. Keep the grass well-watered and mowed. Have your trees trimmed. Cut back overgrowth. Plant some blooming flowers. Store toys, bicycles, roller-skates, gardening equipment and the like out of sight. Have at least the front of your house and the trim painted, if necessary. Sweep the porch and the front walkway. After dark, turn on your front porch light and any other exterior lighting.

2. Clear out the clutter. Real estate agents say buyers won't purchase a home they can't see. If your home has too much furniture, overflowing closets, crowded kitchen and bathroom countertops or lots of family photos or collectibles on display, potential buyers won't be able to see your home. Get rid of anything you don't need or use. Fill up your garage or rent some off-site storage space if that's what it takes to clear out your home.

3. Use your nose. Many people are oblivious to scents, but others are extremely sensitive to offensive odors. To eliminate bad smells, bathe your pets, freshen the cat litter box frequently, shampoo your carpets, dry clean your drapes, and empty trash cans, recycling bins and ash trays. Place open boxes of baking soda in smell-prone areas, and refrain from cooking fish or strong-smelling foods. Introduce pleasing smells by placing flowers or potpourri in your home and using air fresheners. Baking a fresh or frozen pie or some other fragrant treat is another common tactic.

4. Make all necessary repairs. Buyers expect everything in their new home to operate safely and properly. Picky buyers definitely will notice-and likely magnify -- minor maintenance problems you've ignored for months or even years. Leaky faucets, burned-out light bulbs, painted-shut or broken windows, inoperable appliances and the like should be fixed before you put your home on the market. These repairs may seem small, but left undone they can lead buyers to question whether you've taken good care of your home.

5. Introduce lifestyle accessories and make your home as comfortable and attractive as possible. Set the dining room table with your best dishes. Put out your only-for-company towels. Make up the spare bed. Hang some fresh curtains. Put some logs in the fireplace. Use your imagination.

6. Get a buyer's-eye view. Walk up to your home and pretend you've never seen it before. What do you notice? How do you feel about what you see? Does the home seem inviting? Well-maintained? Would you want to buy this home? Your answer should be an enthusiastic yes!

Every reasonable owner wants the best possible price and terms for his or her home. Several factors, including market conditions and interest rates, will determine how much you can get for your home. The idea is to get the maximum price and the best terms during the window of time when your home is being marketed.

In other words, home selling is part science, part marketing, part negotiation and part art. Unlike math where 2 + 2 always equals 4, in real estate there is no certain conclusion. All transactions are different, and because of this, you should do as much as possible to prepare your home for sale.

What is your home worth?
All homes have a price, and sometimes more than one. There's the price owners would like to get, the value buyers would like to offer and a point of agreement which can result in a sale.

In considering home values, several factors are important:

• The value of your home relates to local sale prices. The same home, located elsewhere, would likely have a different value.
• Sale prices are a product of supply and demand. If you live in a community with an expanding job base, a growing population and a limited housing supply, it's likely that prices will rise. Alternatively, it's important to be realistic. If the local community is losing jobs and people are moving out, then you'll likely have a buyer's market.
• Owner needs can impact sale values. If owner Smith "must" sell quickly, he will have less leverage in the marketplace. Buyers may think that Smith is willing to trade a quick closing for a lower price -- and they may be right. If Smith has no incentive to sell quickly, he may have more marketplace strength.
• Sale prices are not based on what owners "need." When an owner says, "I must sell for $300,000 because I need $100,000 in cash to buy my next home," buyers will quickly ask if $300,000 is a reasonable price for the property. If similar homes in the same community are selling for $250,000, the seller will not be successful.
• Sale prices are NOT the whole deal. Which would you rather have: A sale price of $200,000, or a sale price of $205,000 but where you agree to make a "seller contribution" of $5,000 to offset the buyer's closing costs, pay a $2,000 allowance for roof repairs, fund two mortgage points, re-paint the entire house and leave the washer and dryer?

How much is too much?
Because all transactions are unique there is flexibility in the marketplace. The amount of flexibility depends on local conditions.

For example, suppose you're selling a townhouse. Suppose also that there have been five recent sales of the model you own and that sale values have ranged between $200,000 and $210,000. You now have an idea of how your home might be priced. In a strong market perhaps you can ask for $210,000 or a little more. If the market has slowed, $210,000 may be a reasonable asking price, but perhaps more than the final sale price.

Here's another scenario. Imagine that you live in a community of Victorian-style homes, most of which were built in the 1920s. All the homes are different in terms of size, condition, modernization, style and features. In such a neighborhood, an average sale price is just a statistic without much practical meaning. On a single block one home may sell for $400,000 while another is priced at more than $1 million. The average price may be outrageously high for one home and staggeringly low for another.

There is no question that selling a home is an important event. A home sale represents transition, movement and change. Big money is involved. Households move from the known and comfortable to the unknown and a period of adjustment. There may be job changes, new schools, distance from old friends and the possibility of new ones.

No less important, a home sale by itself can be complex. There will be people looking at your house, documents to sign and issues to be negotiated.

Because a home sale involves an array of both personal and business concerns, it's important to get it done right. You need to carefully prepare your home, understand the market and see what alternatives are realistically available. The old motto "be prepared" is a good guide in such circumstances.

What's an acceptable offer?
The goal of every seller is to have a line of buyers outside the front door, each clutching higher and higher offers. And while this has been known to happen, in most markets there is some balance between the number of buyers and sellers. A number of factors determine whether a buyer's offer is acceptable. They include:

• Is the offer at or near the asking price? Is the offer above the asking price?
• Has the buyer accepted the asking price or something close? Has the buyer then buried thousands of dollars in discounts and seller costs within tiny clauses and contract additions?
• What is the alternative to the buyer's offer? If a home has not attracted an offer in months, then sellers need to determine if a better deal is possible -- recognizing that each month costs are being incurred for mortgage payments, taxes and insurance.
• Does the owner have enough time to wait for other offers?
• What if no other offers are received?
• What if several offers are received? Do you choose the high offer from the purchaser with questionable finances who may not be able to close, or a somewhat lesser offer from a buyer with preapproved financing?

What is a counter-offer?
When a home is made available for sale the owner is essentially making an offer to buyers: For a given number of dollars and other terms you can acquire this home. Buyers, in turn, can respond with several options:

• Not interested.
• Yes, we'll buy on the owner's terms.
• We're interested and here's our counter-offer.

A counter-offer is nothing more than a new offer. And just as the buyer had three options in response to the owner's original price and terms, the seller can now choose one of three reactions: accept the offer, decline the offer or make a fresh counter-offer.

Offers and counter-offers reflect the back-and-forth activity of the marketplace. It's an efficient and practical process necessary to maintain market conditions and should be accepted not feared.

How do you negotiate?
It's sometimes argued that negotiation must produce one "winner" and one "loser." Others suggest that a "win/win" situation is possible where each side gets something of value.

Real estate bargaining typically involves compromises by both sides. It's not war; it's not winner-take-all; and it's not the time to take personally any comments made by purchasers.

Instead, negotiating should be seen as a natural business process; buyers should be treated with respect; and owners should never lose sight of either their best interests or their baseline transaction requirements. These are the standards unique to each owner, which must be met before the home can be sold.

The natural focal point of a real estate purchase contract is the selling price of the home, but the price isn't the only factor that determines the net bottom line for both the buyer and the seller. Is a bargain for the buyer really a bargain if he or she is paying all the transaction costs? Is a top price for the seller really a top price if the buyer wants all the furniture to be included in the purchase price? Or if the buyer can't come up with the downpayment or qualify for a mortgage? Before you decide to go ahead with a great price, here are five other bottom-line points to consider:

1. What are the estimated transaction costs and who will pay for what? Typical costs include the brokers' commission, a home inspection, a termite inspection, escrow or attorney's fees, a title search, an owner's title insurance policy, transfer taxes and recording fees. The price tags on these items vary greatly around the country. Who pays for what is a matter of both local custom and negotiation.

2. How much money is the buyer putting into escrow and how soon? A big deposit -- called "earnest money" -- and a substantial downpayment are generally seen as a sign that the buyer is serious about completing the transaction. From the seller's point of view, the more money the buyer places in escrow and the sooner the money is transferred, the better.

3. Is there a mortgage financing contingency and how specific is it? The mortgage escape clause is a must for buyers, unless they're paying all cash for the home. Without this contingency, buyers can be legally obligated to purchase the home even if they can't obtain financing. Further, an open-ended statement that says the buyer will obtain a loan "at the prevailing rate of interest" leaves the buyer completely exposed to interest rate fluctuations. A statement that says the loan must be at an interest rate "not to exceed xx percent" and on specified terms is preferable.

4. What furniture, fixtures and appliances, if any, are being sold with the property? Technically, anything that's permanently affixed to or installed in the home is real property. Everything else is the seller's personal property. This distinction is a narrow one and it naturally leads to a fair amount of confusion. Are built-in appliances real property or personal property? What about a shelving system? A chandelier? Window coverings? Potted plants in the backyard? Sellers who intend to remove anything that's attached to the home should have that spelled out in the contract. And the same goes for buyers who expect to acquire any of the furniture or other movables.

5. What will happen if either side breaches the contract? Unless an unmet contingency triggers the abandonment of the contract, it's a binding legal document. Buyers who fail to perform can lose their deposit money. Sellers who try to back out can be sued for "specific performance," which forces the sale of the home to the buyer. Many contracts also specify that disputes must be brought in small-claims court or presented for arbitration or mediation.

Most home buyers and home sellers want to arrive at a win-win agreement, but that's not to say either side would regret getting a bigger "win" than the other. Successful negotiating is more than a matter of luck or natural talent. It also encompasses the learned ability to use certain skills and techniques to bring about those coveted win-win results. Here are six tips and suggestions to turn negotiation into agreement:

1. Start with a fair price and a fair offer. There's no question that significantly overpricing your home will turn off potential buyers. Likewise, making an offer that's far lower than the asking price is practically guaranteed to alienate the sellers. Asking and offering prices should be based on recent sales prices of comparable homes.

2. Respect the other side's priorities. Knowing what's most important to the person on the other side of the negotiating table can help you avoid pushing too hard on hot or sensitive issues. For example, a seller who won't budge on the sales price, might be willing to pay more of the transaction costs or make more repairs to the home, while a buyer with an urgent move-in date might be willing to pay a higher portion of the transaction costs or forgo some major repairs.

3. Be prepared to compromise. "Win-win" doesn't mean both the buyer and the seller will get everything they want. It means both sides will win some and give some. Rather than approaching negotiations from an adversarial winner-take-all perspective, focus on your top priorities and don't let your emotions overrule your better judgment.

4. Meet in the middle. Can't decide who will pay the recording fee? Can't agree on a close-of-escrow date? Arguing over cosmetic repairs? Splitting the difference is a time-honored and often successful negotiation strategy. Pay half the fee. Count off half the days. Fix half the blemishes.

5. Leave it aside. Politicians and corporate executives are famous for their "for future discussion" agreements. If you have a major sticking point that's not material to the overall contract (e.g., the purchase of furniture or fixtures), finish the main agreement, then resolve the other difficulties in a side agreement or amendment. This technique allows both sides to recognize and solidify basic areas of agreement, then move ahead toward a fair compromise on other terms and conditions. Summarizing the points of agreement in writing is another helpful strategy.

here's a lot to consider before you sign a real estate purchase agreement. If the terms and conditions of the deal aren't acceptable, you might want to pause and think twice, even if the purchase price is more than satisfactory. After all, the price will be moot if the transaction never closes.

The typical residential real estate purchase contract is complicated, densely written and packed with legal jargon, but don't use that fact as an excuse for not reading the entire contract. Take your time and read slowly. Ask questions about anything you don't understand. Be flexible and willing to negotiate. The following five points are among the many items that merit attention:

1. What are the cutoff dates for inspections and approvals of the inspection reports? A typical contract provides an opportunity for the buyer to hire all manner of experts to check out the condition of the home. From the buyer's perspective, the more time that's allowed for these once-overs, the better. Sellers, on the other hand, usually want the inspections to be completed and signed off as soon as possible.

2. Who is responsible for making repairs, if any, as a result of the inspections? The fact that the buyer orders one of more inspections of the home for informational purposes doesn't obligate the seller to make repairs or modifications as a result of those inspections. In practice, however, inspection reports often are used to negotiate repairs of major problems or safety or environmental hazards that may be noted. The purchase contract should provide some guidance for these negotiations.

3. Is the seller making any representations or warranties regarding the condition of the property? In some contracts, the seller warrants that specified major components of the home (e.g., the roof or central heating or cooling system) are in good repair and working order at the close of escrow. Buyers should understand which components of the home are guaranteed and which are being sold "as-is."

4. Will a home warranty plan be purchased? A home warranty plan is a sort of limited insurance policy covering the basic major systems and appliances in the home. It may seem like a prize for the buyers, but it's equally important for the sellers and the real estate broker representing the sellers. In fact, these warranty plans are so popular among real estate agents that many of them will pick up the tab for the program in order to insulate themselves from irate buyers.

5. When is escrow scheduled to close? Pay attention to this date! If you're selling your home, you'll be expected to move out completely before the property changes hands. You'll want to make sure the closing date doesn't fall before you're able to move into your next residence. If you're buying a home, you'll be able to pick up the keys on the day escrow closes. You'll want to make sure you don't give up your prior residence too soon. Don't cut the dates too close. Many escrows end up closing a day or two later than the contract states--but that can happen only with the mutual agreement of the buyer and seller.

In many of today's strong real estate markets, home sellers can expect to receive multiple offers for their home. Multiple offers are a classic example of economic realities because they appear when the supply of homes for sale is limited and the demand for good-condition homes is strong. Sellers love multiple offers because they push up home prices and create an opportunity to spark a bidding war. Knowing how to respond to multiple offers can help you get the best price and terms for the sale of your home.

How can I make sure my home will attract multiple offers?
Hit the market at the right price and, assuming your home is in good condition, multiple offers should come in. "Sellers see [home prices] are going higher, so they want to go a little higher. Sometimes it works and sometimes it doesn't. You can end up having to wait for the market to catch up with you," says Bob Stallings, broker/owner of RE/MAX Real Estate Specialists in Long Beach, California.

Do I have to accept the offer with the highest price?
No. If you prefer a lower-priced offer, perhaps with a better qualified buyer or more attractive terms, you can accept that offer instead. Or you can give counteroffers to one or more of the buyers.

Being greedy can back-fire. REALTOR® Rae Wayne of The Bizzy Blondes team with RE/MAX Westside Properties in Culver City, California, says one seller instructed her to tell all the buyers' agents that offers would not be considered until the property had been on the market for one week, unless the offer was full-price or better. One agent asked to submit an offer right away, but the sellers, who were hoping for multiple offers, insisted on waiting until the appointed time. A week later, that agent was still the only one ready to submit an offer. "The seller said to me, 'What if we plan a party and nobody comes?' I said, 'That's the risk you took when you didn't want to look at this offer four days ago,'" she says. If you delay, anything can happen, including the buyers losing interest or offering a lower price.

My agent says I should receive all my offers by fax, rather than having the buyers' agents present the offers. Is that okay?
Some agents recommend the fax-only option. "Very few agents who do a lot of business will [present offers] anymore," says Carole Geronsin, a Realtor-associate with Prudential California Realty in Anaheim Hills, California. "Before, everyone would meet and the agents would tell all about their buyers, then everyone would wait while the seller made a decision." If there are multiple offers, the fax-only practice is a time-saver for you and the agents. However, the jury is still out on this practice. "I wonder [whether] the sellers are getting the full picture of the buyers, unless there are cover letters telling them about the buyers' qualifications. It's hard to really understand [the offers] and make a clear decision," says Stallings. "I'm a strong believer that it's best for both sides to have the offers presented, so the seller can ask the buyers' agents questions about the buyers."

TIP: You might want to receive all the offers by fax, then have the top offers presented. Either way, you, as the seller, make the rules.

One of the buyer's agents is from the same brokerage company as my agent. Should I give extra consideration to this "in-house" offer?
No. All offers should be evaluated equally based on the net price and terms. "We often have offers on our own listings and the sellers don't pick ours. If my own offer is marginal and the other offer is good, the last thing I want is for my seller to be mad at me. I'm going to look for the best offer," says Judy Sheller, the other half of The Bizzy Blondes team.

Can I counter more than one offer?
Yes. However, if you accidentally accept more than one offer you could be legally obligated to sell your home to two buyers. For safety's sake, use a standard counteroffer form that says the counteroffer isn't accepted until it is signed by the buyer and subsequently accepted by you.

Can I back out of my escrow with buyer A and accept a new higher offer from buyer B that my agent just received?
Trying to back out of an escrow is extremely unwise because an accepted purchase offer is a legal contract and the buyer can take action to enforce it. "Legally, once you have signed and agreed to the offer with buyer A, you can't get out of it. Your only hope would be that the buyer does an inspection and makes a bunch of requests. You flatly refuse everything and perhaps the buyer walks away," says Wayne.

Your home is in escrow, and the buyer has scheduled a home inspection. Should you be worried about what the inspector might find? The answer depends, of course, on the condition of your home and how well you've maintained its major components over the years. Regardless of what the inspector may uncover, however, you shouldn't be overly concerned about the actual home inspection. Keeping in mind that disclosure laws and customary real estate practices vary from place to place, here are six suggestions as to how you might help the home inspection process go smoothly:

1. Leave the premises. It's perfectly reasonable to absent yourself from your home during the home inspector's visit and turn over the duties to Some one you trust.

2. Be courteous. Some sellers mistakenly assume the home inspector is an adversary. Experienced professional home inspectors aren't on a mission to find fault with every tiny aspect of your home. The home inspector's role is to offer the buyer a fair assessment of the property. Tips: Don't keep the inspector waiting on your doorstep and allow at least two hours for the inspection.

3. Don't attempt to refute negative comments about your home during the inspection. Inspectors don't appreciate being followed around by argumentative or defensive home sellers (or sellers' real estate agents). The time to explain and negotiate will come after you receive and review your copy of the inspector's report.

4. Don't make statements about your home that are beyond your personal knowledge or can't be verified. For instance, if the inspector asks you how old the roof is or when certain appliances were installed, check your records before you answer. If you have documentation, provide a copy of it. If repairs or modifications were made prior to your purchasing the home, don't guess when that work was performed. The same caution about misrepresentations applies to questions about whether permits were obtained for remodeling, the exact square footage of your home, the name of the architect who designed it and so on.

5. Don't block access to normal living areas of your home. If the home inspector can't enter a room or complete some other aspect of the inspection, that will be noted in his or her report and the buyer may question it.

6. Make agreed-upon repairs promptly. The buyer may ask the inspector to okay any repairs you agree to make as a result of the inspection. The sooner you make the repairs, the sooner the contingency can be met. Delaying the repairs until the last minute won't stop the buyer from having those items reinspected, but it could delay the closing of escrow.

Here are some questions you might want to ask yourself after your Open House:

1. How many people stopped by and who were they? If the turnout was disappointing, you may want to quiz your agent about his or her efforts to attract people to the event. Was the open house listed in the newspaper? Mentioned around the agent's office? Did any of your neighbors drop by?

2. When and how will the agent follow-up with prospective purchasers or their agents? Hot prospects who seem well-qualified should be contacted as soon as possible after the event and asked whether they're interested in seeing the home again, have any questions or concerns about the home or are planning to make an offer to purchase it.

3. What positive and negative feedback did you receive about the home? You'll certainly want to know what people are saying about your home, but don't take minor criticisms too personally or overreact to any one person's comments. Do pay attention to repeated criticism of one or more specific aspects of your home. You can disregard one person who dislikes your taste in wallpaper, but if six or seven people make the same comment, you might want to have that offensive pattern stripped off.

4. Did any problems or mishaps occur during the open house? Many open houses attract only a handful of visitors, but it's also entirely possible for 15 or 20 people to traipse through your home in a couple of hours. If there were any problems -- someone injured a knee on your glass -- topped coffee table or slipped and fell on the wet grass in your backyard-you'll want to know about it.

5. What's next? Now that the open house is over, what else is your agent planning to do to find a buyer for your home? Does the agent intend to continue with the existing marketing tactics or will some new plans be put into action? Would another open house be worthwhile?

TIP: Unless open houses are particularly well-attended in your neighborhood, you might want to forgo these events altogether or just hold one open house the first or second weekend after your home is listed. Some surveys suggest that open houses are more beneficial for the agent than the home seller and that only a tiny percentage of homes are sold as the direct result of an open house.

It might seem as though once a sale agreement has been signed that the selling process is complete. Not only is it not over yet, but some of the most complex aspects of a real estate transaction now begin.

A sale agreement sets not only a purchase price for the home, but also a series of terms and conditions. For instance:

• Contracts routinely depend on the ability of a buyer to obtain financing, which is why most sellers prefer buyers with preapproval letters from lenders.
• A growing percentage of transactions involve a home inspection, or a physical review of the home by a trained and independent observer.
• Lenders will establish numerous conditions before granting a loan. They will want a title exam, title insurance to protect against title errors, termite inspections, surveys and an appraisal to assure that the home has sufficient value to secure the loan.

When should you close?
With automation now available, closings can occur within a week in some areas -- at least in theory. In practice, it takes time to arrange financing, conduct inspections, obtain appraisals, locate replacement housing, contact movers, pack and actually move.

While instant closings are not practical, neither are closings too far in the future. The problem with closings much past 60 days is that loan rates are difficult to lock in. If mortgage rates go up, it's possible that the buyer will no longer be able to afford the home and thus the deal may fall through.

The result of these considerations is that most homes close 30 to 45 days after a sale agreement has been signed.

What happens?
Closing -- or "settlement" or "escrow" as it is known in some areas -- is essentially a meeting where the closing agent (the party who conducts settlement) takes in money from the buyers, pays out money to the owner and makes sure that the purchaser's title is properly recorded in local records along with any mortgage liens.

The closing agent reviews the sale agreement to determine what payments and credits the owner should receive and what amounts are due from the buyer. The closing agent also assures that certain transaction costs are paid (taxes and title searches).

Closing is also the time when "adjustments" will be made. For instance, suppose you've pre-paid taxes four months in advance. In this case, the closing agent will compensate you for the prepayment at closing by having the buyer pay you additional money.

It could also work in reverse. If you are behind on property taxes, the closing agent will reduce the money due to you at settlement by the amount of the unpaid taxes.

How do you prepare to sell?
It's important to look at the sale agreement and review your obligations. For instance, if you have agreed to paint a room or replace the dishwasher, such work must be completed before closing.

One of the hot topics facing the world of real estate right now is the issue of agency. Some would have you believe that it really doesn't affect you, the buyer, and that nothing much has changed. But they are wrong.

The topic of agency is important to you because it answers the most basic and fundamental question that can be asked of any real estate professional: Who do you represent in this transaction?

Until that question is answered, you may be left with the impression that all agents who work with buyers actually represent those buyers, and that you have somebody going to bat for you in this transaction. Well, the issue of agency is important because without it, we can never be sure who represents who.

Here's the scenario:

You meet a really nice agent at an open house named Bonnie. Even though Bonnie's house is not right for you, she tells you she has others to show you that fit your needs exactly. You spend an hour or so with Bonnie looking at a half dozen homes and talking about your needs and your wants. During the course of the conversation, you volunteer that you have $100,000 cash to spend and that you will not go over $100,000 purchase price no matter what. Then you find the perfect house. Asking price is $100,000 but you decide to offer $92,500 based on recent sales in the area. During negotiations, the seller asks Bonnie directly how much cash you have and how high will you go? What does Bonnie say?

Here's the answer: Unless you have signed a "Buyer Agency Agreement" with Bonnie making her your buyer agent, she is most likely acting as a sub-agent to the listing broker who represents the seller. If that is the case, she has a fiduciary obligation to the seller to disclose to him any information she has that might "promote or protect his interest" in the transaction. Guess what? Bonnie has that information.

The Seller, now having knowledge of your financial position, counters at a full $100,000. He knows you can afford it and that this price falls within your desired range. He also knows that you have seen a number of other homes and that his is the one you want.

Regardless of what eventually happens in this scenario, it can hardly be called an even playing field. So, how can you protect yourself from a possible disclosure required of a seller's agent?

1. Make sure that the agent you are working with has agreed, in writing, to represent you as a "Buyer's Agent." This will mean signing a buyer brokerage agreement in which you promise to work only with that particular agent for a specific period of time, often 90 days. It also means that you promise not to buy from anybody else, even FSBOs, without involving your buyer's agent. In almost every case, the commission will still come from the seller, but your agent must present the offer.

2. Never say anything to anybody unless you would be willing to have that information repeated into a seller's ear. Assume that everybody, and I mean everybody, is working for a seller unless you have specifically hired them to work for you. And even then, be discreet. During the second world war, the military promoted a phrase designed to stop idle gossip: Loose lips sink ships! You would do well to adopt that philosophy in your home-buying as well.

Even the smallest home contains a lot of furniture, clothes, kitchen equipment, pictures and other items. For a short move, it may be worthwhile to transport small goods by yourself, but larger items will likely require a professional mover.

Homestore.com's moving center provides calculators as well as information on moving options, storage, truck rentals and related topics. This information, plus assistance and advice from your REALTOR®, can ease the moving process.

It's ideally best to get rid of excess furniture and other goods by having a sale before you move. This will reduce the volume of goods to be moved and thus lower moving costs. Unwanted furniture which cannot be sold can often be donated to charitable groups, many of which will come to your home to pick up donations. All other unwanted items should be taken to a landfill. You should provide the U.S. Postal Service with a forwarding address, and utility companies should be advised when to end service. Check with utility companies to see if there is deposit money which should be returned.

How do you plan a move?
The time to plan your move begins once you've decided to sell your home. Some of the activities required to sell the home can actually help with the moving process. For example, cleaning out closets, basements and attics means there will be less to do once the home is under contract.

Your planning will be guided by a number of things:

• Are you moving a long distance? If yes, you'll likely require an interstate mover and the use of a large van.
• Moving internationally. Contact the embassy in Washington, D.C., for information. Be aware that items which may be entirely common in the United States can be prohibited in foreign countries. Ask about customs protocols, duties and taxes.
• Moving locally? If yes, will you move yourself? You'll need to consider packing boxes, peanuts, blankets or padding and a van rental.
• Planning is key. Stock up on boxes, packing materials, tape and markers. Always mark boxes so that movers will know where goods should be placed.

Who should you use?
The best people to ask are the people you trust. Your family and trusted friends might not have moved recently but they might know someone who has. Have the courage to ask anyone if they know any one in the area who has moved lately. Make contact with them and ask them questions about who they used to moved and if they liked them.

There are a number of factors to consider. Money is one issue: You'll want to spend as little as possible, but choosing only on the basis of cost can be a mistake. Movers must have the right equipment, training and experience to do a good job. A mover, no matter how large or small, should be able to provide recent references for homesellers with a similar volume of goods to transport.

Get mover estimates in writing. Be aware that it's possible to get discounts through membership organizations and, sometimes, on the basis of your profession: Clergy, for example, sometimes qualify for a discount.

Always confirm mover credentials. Movers should be licensed and bonded as required in your state, and employees should have workman's comp insurance.

Get a checklist.
Moving is a big job and checklists can make it more organized and easier. Here are some of the major items to consider:

• Money. If you're moving more than a few miles then you should have enough cash or credit to cover travel, food, transportation and lodging.
• Medicine. Keep medicines and related prescriptions in a place where they will be available during the move.
• Number boxes so that all items can be counted on arrival. Make a list of boxes by number and indicate their contents.
• If moving with children, make sure that each has a favorite toy or toys, blankets, games, music and other goods.
• Moving historic, breakable or valued items? Such goods routinely require special handling and packaging.
• Have address books readily available in case you need help.
• If you have a laptop computer with a modem, make it accessible during your trip to pick up business and personal e-mail.

To quote a mortgage broker: "There is a different loan for a different need." In other words, the type of mortgage you get depends on your individual situation. A good lender will get a sense of your needs from your credit report, your assets, and your employment history. He can then recommend some options for you. Here's a rundown on the most common loan types on this.  

Fixed-Rate Mortgage

Interest is fixed for an amount of time; e.g., 10, 15, 20, 30, or even 40 or 50 years, at which point the amortized principal is paid in full.
Pros: Security. You know what your payments will be. You can refinance if rates drop significantly.
Cons: If rates go down, you'll still be paying the initial rate unless you refinance.    This is a long-term prospect; if you are keeping your home for 15  or even 30 years, it's a conservative way to go. But you can end up paying more short-term than if you had an ARM.
Watch out: This is a long-term prospect; if you are keeping your home for 15 or even 30 years, it's a conservative way to go. But you can end up paying more short-term than if you had an ARM.

Adjustable-Rate Mortgages (ARMs)

The interest rate fluctuates with an indexed rate plus a set margin; adjustment intervals are predetermined. Minimum and maximum rate caps limit the size of the adjustment.

Pros: Initial rates are lower than fixed. Popular with those who aren't expecting to stay in a home for long, or in a hot market where houses appreciate quickly, or for those expecting to refinance. You can qualify for a higher loan amount with an ARM (due to the lower initial interest rate).   Annual ARMs have historically outperformed fixed rate loans.

Cons: Always assume that the rates will increase after the adjustment period on an ARM. You are betting that you'll save enough initially to offset the future rate increase.

Watch out: Check out the frequency of the adjustments. The more often, the lower the starting rate, but the more uncertainty. The less often, the higher the rate, but a little more security. Check the payments at the upper limit of your cap (your rate can increase by as much as 6 percent!); you can get burned if you can't afford the highest possible rate. And planning that a refinance will bail you out is risky; what if you can't afford (or can't qualify) when the time comes?   

1-yr. Treasury ARM   

The rate is fixed for one year, then becomes adjustable every year. The new rate is determined by the treasury average index plus the loan margin (usually 2.25-2.5%). 30-yr. term.
Pros: Lower rates than a fixed mortgage. When rates go down, you benefit.
Cons: Watch the margin; the margin is added to the index to come up with the new rate after the adjustment period. When rates are going up, you could end up paying more interest than with a fixed.
Watch out: If you are a gambler and think the rates won't increase, this might work for you. But if you are into it for the long or even intermediate run, fluctuating interest rates can mean higher payments over time.

Intermediate ARM 

With an intermediate or hybrid ARM, the rate is fixed for a period of time, then adjusts on a predetermined schedule. This is shown by the number of years the loan is fixed, and the adjustment interval (.e.g., 3/1 ARM is 3 year fixed, and 1 adjustable annually). The new rate is determined by an economic index (usually treasury or treasury average index) plus the loan margin (usually 2.25-2.5%). 30-yr. term.
Pros: Lower rates than a fixed mortgage. When interest rates rise, you see more ARMs because they are easier to qualify for.  
Cons: When rates are going up, you could end up paying more interest than a fixed-rate mortgage after the initial period.
Watch out:  If you aren't planning to keep your house for long this might work for you because you will receive lower rates initially. Be sure to check the rate caps so you know exactly how high your payments can go. Fluctuating interest rates can mean higher payments over time.

Flexible Payment Option ARM

The borrower chooses from an assortment of payment methods every month. There is a "change cap" limiting how much payments can vary in a year.
Pros: Frees up cash when you need it. Good for buyers with variable incomes (e.g., salespeople who work on commission).
Cons: Some options won't cover your interest. With lower payments, your balance increases each month, and eventually your payments will increase substantially. This could lead to negative amortization.
Watch out: Eventually you will be required to pay down the principal and your payments will increase drastically. If you can't make them, you lose the house. Most experts say, "Don't do it."

Interest-only ARM

For a period of time, you pay only interest, and do not pay down the principal.
Pros: If you don't plan to stay in a home long, you can buy something you ordinarily couldn't afford. If you are in a hot market, or a hot neighborhood, you'll have low payments while your house appreciates in value. You can always pay more on the principal while enjoying the low payments. One other great thing about an interest only mortgage is that payments made to the principal reduce your monthly payment. So, if you have a job that has a heavy non-scheduled bonus or commission  based compensation plan, you can pay the interest  every month and when you get your bonuses pay down the principle to reduce your monthly payment.
Cons: The day will come when you need to pay down the principal. If your home value has fallen, or your income decreased, you could have trouble making the new payments.  One strategy is to invest the difference between an interest-only loan and a fixed-rate loan to build up cash reserves. 
Watch out: If you can't pay interest and principal at the same time, chances are you can't afford the house. You can only put off the inevitable for so long: the principal has to be paid down. If you can't make payments, you could lose the house.  If you plan to sell your house and can't sell it for what you owe, you are in trouble.

Convertible ARM

An ARM that can be converted to fixed rate after a period of time.
Pros: Saves on refinance costs, assuming you would have been switching anyway.
Cons: You will have a higher rate for the fixed with a convertible loan. You can't look around for a better deal, which you can with a refi.
Watch out: Saving the cost of the loan and the hassle of shopping loans are a plus, but you might be crying if the refinance rates are lower than your new fixed. Experts say, "Just refinance."

Jumbo Loans

Above Freddie Mac and Fannie Mae conforming guidelines, therefore the big secondary lenders will not secure jumbo loans.  2006 maximum amount for a conforming loan: $417,000.
Pros: When the market is out of sight, the jumbo loans make a purchase possible.
Cons: Higher down payments, and higher interest rates.
Watch out: If you can afford the higher payments, then go for it. But make sure you can afford them.

Assumable Mortgage

An adjustable-rate loan, the balance of which can be assumed by a home buyer.
Pros:  Sellers can offer a low interest rate to entice buyers.
Cons: This is almost never a fixed rate mortgage, so the savings might not be all that great.
Watch out: These are rare today.  If the buyer who assumes the loan defaults, the bank will go after the original borrower.

FYI - FHA loans are assumable, but are fully-assumable and are not always ARMS.

Balloon Conforming Mortgage

Interest rate is fixed for a period of time, but the principal is not completely amortized.  For the remainder of the term, it adjusts to a new fixed rate determined by the Fannie Mae net yield index plus the margin. 30-yr. term
Pros: Lower monthly payments initially. If your career (and salary) has a good future, or you are in a hot market and plan to sell before the balloon comes due, you can save moolah.
Cons: Who knows what that new rate will be? There's a looming debt in your future.
Watch out: You can refinance when the balloon comes due, but you are gambling that you can afford the refi loan.

Balloon Mortgage

The rate is fixed for a period of time, but the principal is not completely amortized during the period. The entire balance of the principal is due as a balloon payment at the end of that period.
Pros: Lower monthly payments, with the idea you can always refi or sell before the balloon.
Cons: A big elephant waiting in the wings
Watch out: It's easy to procrastinate, or your life changes, and then your balloon pops. Refinancing costs might offset any savings you made.

Reverse Mortgage

Veteran Administration Loans (VA Loans)

A zero-down loan offered to veterans only; the VA guarantees the loan for lenders.
Pros: Nothing down, and no mortgage insurance. The loan is assumable.
Cons: The rate might be higher than conventional loans or FHA loans.
Watch out: Shop around first.  Lenders are paid a 2 percent service fee by the government, so your points should reflect a discount when compared to similar rate loans.

Federal Housing Administration Loans (FHA Loans)

HUD.gov

Government-insured loan with low down payment (as little as 3%).  Down payment assist programs are available where buyers apply for a grant of up to 3% of the purchase price for down payment.

Seller concession allowed up to 6% of the purchase price to pay closing costs and or apply towards down payment.  Buyers can also use up to 3% "gift" funds for down payment or closing costs from a family member. 

FHA loans do not have a minimum credit score requirement, no trade line history requirement, no reserve requirement.
New FHA maximum loan limits differ from county to county.

FHA Lending Limits

Get Prequalified

Pros:

-Very low rates compared to conventional and Fannie Mae loans. 

-Rates are not fico driven (a 580 score borrower usually qualifies for the same FHA rate as a 700 score borrower). 

-Non occupant co borrowers are allowed

-Monthly Mortgage Insurance premium never exceeds .5% of your loan amount annually.

-FHA loans are assumable.  A seller can sell their home and transfer their FHA loan to the buyer.  (subject to buyer approval.)

-FHA's MIP is lower than the  PMI (Private mortgage insurance which is needed on conventional loans that have less than 20% down.)

-Rehab loans are available under section 203k that can be done by approved 203k  FHA  lenders and now there is a streamline 203k that can be done by any FHA  approved lender. See mortgagee letter 2005-50 at www.hudclips.org

Cons:

-Requires full documentation of income

-Only available on SFRs, Condos, 1-4 unit properties, and manufactured homes built HUD approved.

-HUD approved manufactured homes require a Professional Structural Engineering Report

-Requires an "up front mortgage insurance premium" of 1.5%, monthly mortgage insurance at 0.5% on ALL loan to value ratios (loan amount/purchase price). 

-Monthly mortgage insurance can only be removed after 5 years has passed, and the loan to value ratio is below 78%. 

-Cash out refinances for loan amounts above $417,000 (where available) is limited to 85%. 

-Loans at $417,000 (where available) or above located in a declining market area and at 95% require two appraisals