No matter when you are moving or where you are planning to buy there are risks associated with buying and selling a home – and unfortunately, the majority of the risks have to with the colossal amounts of money being put into both sides of the process.
There is not really any way to remove all risks, since the process does involve such a large sum of money – however, there are some things you can do to reduce the risk – especially if you are sitting in the shoes of the seller.
1. Do NOT sell your home before closing on a new one. Even though the risk here isn’t as high as some other things on our list – selling before you close on your new home can be a risk. We understand why sometimes it has to be done (because you need the money to buy your new home – but experts suggest having your new keys in hand before even listing your home. When purchasing, your sellers may not have a new home yet, and may have to pull out of the market, leaving you with nowhere to go if your home is already sold. One advisor suggests that, even if you aren’t looking to purchase a home after you sell your existing one, you should get pre-approved for a mortgage. He says it will help your credit score.
2. Move out of your home to sell it. Moving out of your home and in with friends or relatives, is not only bad for your relationships, but also leaves the home feeling cold and often causes it not to sell. You do want to remove any personal items – so that a buyer can picture themselves in the home – but moving out entirely often leads to disappointment.
3. Do NOT use your retirement money as a down payment. You may think this would never be you, but if you have found a home that you absolutely love that is just a little bit out of your reach – you may consider it. Don’t ever expect everything will go as planned. Make sure you are planning for your future as well as your present. Remember that the penalty for taking money out of your 401 (k) is 10% and if you do not replace that money before the time runs out.
4. Do NOT price your home too high – especially in a fast moving market. If your home doesn’t sell quickly, people will assume there is something wrong with the house. Even if you reduce the price – the stigma can continue with the price decrease. Just be aware of the true property of your home when you are listing it.
5. Don’t be cheap when it comes to home improvements. Most homeowners don’t want to spend a couple thousand or even more to update a kitchen or bathroom. However, you need to remember that what you are comfortable living with, is probably not what the new homeowners will be comfortable with. It may be well worth your money to do a little updating before putting your home on the market.
6. Don’t take on a DIY if you aren’t a DIY person. If you have never painted a wall, in other words, don’t start now. Make sure you aren’t taking on a project that you have no knowledge of, or one that may take too long to complete. If you are one of those DIYers that starts something but never finishes it, it may be better to hire a professional, or just not start at all.