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  Buying a home
Top 10 things
The details:

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Lining up cash

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The hunt

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For sellers only
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|> About Money 101

investing 101

  For sellers only
Preparation and timing can help you get the best price

When you decide to sell, the first thing to do is investigate the local housing market. Consult the large real estate sites, like Realtor.com and iOwn.com, to see how similar homes are priced in your neighborhood. Many newspapers also list the selling prices and asking prices of recent sales, plus how long the homes were on the market. Note the prices for your neighborhood during the last month or so. And check how sales were running, say, a year ago, so you get an idea of whether the market is heating up, cooling down, or staying put. This exercise should give you a sense of what your home is worth.

You may decide that you can sell your home without an agent. It's an attractive thought, since you would save the six percent of the selling price that a broker typically collects. But balance that against the work involved in advertising a home and being available at all hours to show it.

If you do decide to work through an agent, ask for referrals from friends or check the 'net and local newspapers for advertisements. Don't simply accept any recommendation. Make an appointment with an agent and interview him or her for the job.

For help in this process, you might check out iOwn.com for a list of questions to ask the agent. You want to be sure he or she is experienced at selling homes like yours, in your area, and is willing to go out and market your home to prospective buyers. Ask to see advertisements the agent has placed on the 'net and in print. Evaluate the person as though you were a buyer: Is he or she attractive and personable? Does he say the right things to make you want to see the home? Also, since the agent will likely be able to advise you on a selling price, how well does his or her price jibe with the homework you did on your own? Don't be fooled by an agent who is merely flattering you with an inflated price. Go by what you already know about your home and the current housing market.

Once you find an agent you like, you have to formally sign a listing agreement. This is like a contract, laying out the specifics of your arrangement, including how long you will let the agent represent your home and what the compensation will be. Many agents prefer an exclusive listing, meaning you agree to pay a commission regardless of whether the agent is actually responsible for finding the seller. You should commit for no longer than three months (one month, in a hot market). In case you find the agent lacking in enthusiasm, you don't want to be locked into a bad situation.

When you discuss the listing agreement, discuss other issues as well. For instance, if there are certain times when you want the house off-limits for walk-throughs, let the agent know. Also, consider negotiating the commission. If your house is expensive, an agent might not flinch if you suggest four or five percent instead of the usual six. Conversely, if you know it's a buyer's market, consider offering the incentive of a higher commission if the agent can land you a sale within five percent of your asking price.

After you've signed a listing agreement, give your lawyer a call to notify him that you're selling your home and will need him to review bids and contracts sometime in the next few months. If your lawyer is not familiar with real estate contracts, then find one who is.

Next, you need to spruce up your home. Take an objective look at it: Is it cluttered? A little worn and tired? Consider a new paint job. Tidy up. Move unneeded furniture into the attic, basement or rented storage. Mow the lawn. Plant flowers, if it's the right season. And so forth. These seemingly insignificant details can add many thousands of dollars to your eventual sales price.

Speaking of which, you'll need to settle on an asking price. In doing so, forget what you originally paid for the house, how much you've spent on renovations or remodeling, and even how much money you need to move on to your next home. When it comes to pricing your property, the only yardstick that matters is what comparable homes are selling for in your neighborhood now -- which may be more, or less, than you sank into it.

Your Net research (see above) will already have given you a good idea of how the market is going. Your agent can also dig up comparable sales, and discuss key elements that make the homes similar to yours. For instance, if you have four bathrooms, you should see how sales for four-bath homes have gone. Also note how long the homes were on the market. If you're in a seller's market, with homes moving in a week or two, think about adding a premium to the asking price. But be careful: The critical selling time is within the first month after your home hits the market. If the price is too high, you'll turn off potential buyers and agents and then have a hard time attracting them back, even if you lower your sights later.

Try not to be there when the agent actually shows your home to potential buyers, by the way. You may inadvertently volunteer information that the buyer can use to negotiate a lower price. For instance, if you mention that you've lived in the home for 20 years, the buyer may figure you won't fight as hard if he makes a lowball bid than if you had recently bought the property at an inflated price.

When you receive a bid, consult your agent to figure out how to respond. If it's within five percent of your asking price, then counteroffer two or three percent less than you're asking and tell the prospective buyer that if that's acceptable, you have a deal. However, if the bid comes in at a discount of 10 percent or even more, then decide with your agent if you will entertain the bid or deny it and move on. You can also throw in furnishings or appliances to make your price more palatable.

Make sure your lawyer reviews the contingency clauses included with the bid. Do not agree to a clause that states that the deal goes through only if the buyer is able to sell his own home. Also make sure that all the buyer's contingencies are restricted within specific amounts of time. For instance, if the deal is contingent upon the home passing an inspection, then the inspection must occur within a week to 10 days of an accepted bid. The same is true of the closing date: Make the buyer commit to a reasonable date, usually 45 to 60 days from acceptance.

The best part of selling your home is that on closing day, your only responsibility is to show up with the keys. You may have to write the buyer a few checks to settle shared payments. For instance, if you've prepaid the property tax for the entire year, but are selling after just six months, then the buyer must reimburse you for the difference, or vice versa. When you receive the check for the agreed-upon sales price, you then write a check to your lender to cover the outstanding principal on your mortgage. Hand over the deed and keys and you're done!

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