PREPARE FOR THE NEXT STEP
Many sellers focus on the process or selling activities and may not be ready for the next steps. The house may sell quickly or take longer than expected which can throw time lines out the window. Plan for a quick and long sale, review possibilities that may require you to live a short time in between permanent homes. If you have children, consider school and the effect the result of the move will have if a temporary living situation is needed.
Once the house is listed you will have potential buyers walking through and touching areas of your house. Be prepared to make available times for buyers to tour the house and agents to perform open houses.
Occasionally a seller will list their home and search for a new home at the same time. This is a good practice although avoid having to ask for a contingency on the property you wish to buy. If the home you are looking to purchase is contingent on the sale of your house, the seller may take another offer.
Another item many sellers do not consider is whether or not they are prepared to purchase their next home. Evaluating the buying situation that you will be in after the sale of your home is important and should not be overlooked.
There are two forms of representation, buyer and listing agents. A basic understanding of each, where an agent commission comes from and its effect on transactions is important. Buyer agents represent the buyer and listing agents represent the seller. In some cases a broker (example ExecuHome Realty) may represent both parties but an agent may not represent both parties legally in the state of Maryland. If the broker is representing both parties they must utilize two different agents within the organization and all parties must agree to dual agency representation in writing.
Commissions are normally paid by the seller and negotiated at the time of the listing contract. The predetermined commission in the listing contract will be split between the agents and negotiated between the brokers. Neither the seller nor buyer will have to be involved in the commission splits among brokers and agents.
Many companies and agents will market low commission rates to attract sellers. More often than not, the commission percentage represented is what is paid to the seller agent and does not include the buyer commission.
When a contract is created it details the commissions to be paid to the buyer and seller agent. Most of the time the commission will be split evenly between the agents. In the event the buyer percentage is low, the buyer could end up paying the difference or choose another property.
Remember, buyers don't pay an agent commissions and most buyers will want representation since it costs them nothing. However, if a commission rate is too low, a buyer agent may require the buyer make up the additional amount. In some cases this could be resolved by asking for a lower price on the home to offset the buyer agent fee although this requires the buyer to pay out-of-pocket for the owed commission. In the end it's better to have a competitive commission for the buyer agent to eliminate any hurdles or extract burden on the buyer.