Smart Moves by Ellen James Martin

Avoiding Last-Minute Pitfalls When Selling

A car salesman and his homemaker wife had long aspired to ownership of their first home near the Catholic school their daughter attends. After a short search, they were thrilled to find a freshly renovated ranch-style house that met their needs, and quickly obtained mortgage approval.

But just days before closing, the transaction came to an abrupt end, recalls Sid Davis, the real estate broker who represented the couple.

"As far as we knew, everything was going smoothly with the car salesman and his wife up until the very last minute, when they breached the sale and lost their deposit," he says.

The lesson is that when it comes to real estate, there are never any guarantees. Even sellers who follow all their listing agent's suggestions to the letter can run into problems, says Joan McLellan Tayler, the author of several real estate books and a former realty company owner.

Still, real estate specialists say there are several strategies that can help homeowners increase their odds of a successful sale. Here are a few pointers:

-- Pick a veteran as your listing agent.

Tayler says too many sellers take a casual approach to selecting an agent.

According to Tayler, sellers should opt for an agent with experience in handling lots of different kinds of deals. Those with a track record, she adds, are most apt to sniff out problems before they happen.

If for personal reasons you're determined to choose a newcomer, she suggests you ask that agent to share the listing with an established pro from the same office.

"With two agents on your side, you'll benefit from both their strengths," Tayler says.

-- Educate yourself on the finances of prospective buyers.

In the aftermath of the real estate downturn, regulators have become exceedingly strict in their oversight of mortgage lenders, resulting in far tighter standards for borrowers.

Smart sellers are careful to check the financial standing of would-be purchasers before they accept any bid.

"You don't want your deal to fall apart because the buyers couldn't get a mortgage," Davis says.

Before accepting an offer, sellers should insist on seeing a genuine "pre-approval" letter from a known lender. This should establish that the prospective buyers have had their credit checked, their employment confirmed and their assets verified.

Also, prospects can be asked to supply other details about their creditworthiness, such as their credit scores. The most common of these, known as "FICO scores," range from 300 to 850. The higher that number, the more likely it is that borrowers will get the loan they need to close the deal.

Buyers can obtain reports on their credit scores from this website: www.myfico.com.

-- Head off issues that could arise during an inspection of your home.

Nowadays, most purchasers exercise their right to a home inspection. And, as Davis observes, many use the findings of their inspector as leverage to renegotiate the deal.

"If the inspector finds anything seriously wrong, the buyers see that as an opportunity to cut you down on price," he says.

Homeowners should never try to talk buyers out of a home inspection. But smart sellers will consider paying for their own inspection even before the property goes on the market.

"The reality is that no two inspectors are likely to find the same minor problems. But both should discover the really huge issues, like water leaks that are undermining the structural integrity of the house," Davis says.

"You're far better off if you can anticipate the big issues with your property before your buyers find them and feel stunned and betrayed that they didn't know about them before they made their bid," he says.

-- Seek to avoid difficult people when doing a deal.

Not all home sellers can be choosy about the offer they select. But if you're reasonably certain you'll have more than one bid from which to pick, Davis says you could seek to avoid cutting a deal with someone who's made nasty comments about your property.

You may not have any direct dealings with your prospective bidders. But your listing agent or others can observe them when they visit your place. And their behavior can be very telling.

"Remember that you can't judge buyers by their superficial behavior and that the sale of a home is a business transaction. It's in your interest to be objective and not subjective. Even so, if you've received multiple bids with essentially the same terms and want to avoid unpleasant people, that's your right as sellers," he says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)