Selling an out-of-state home can be tricky but it definitely isn’t impossible. However, it’s important to understand your situation first before trying to apply “tactics”. Which of the following applies to you?
- Everything is perfect – all of the following are TRUE:
- The house is in immaculate, “show quality” condition. There are no repairs required and all maintenance has been kept up to date.
- You don’t need to sell immediately and can wait up to six months for the home to sell. This includes being able to finance the cost of maintaining a house (passive utilities, lawn care, pool maintenance, etc.)
- You know for a fact that the house has a clean paper trail, is free from liens and carries no creditor obligations.
- All payments are up to date. This includes a mortgage, HOA fees and property taxes.
- The house has more than enough equity to account for “the cost of selling” which includes closing costs, Realtor commissions and other fees. Expect these fees to be between 8% and 10% of your sale price. So if you sell your home for $200,000 your total out of pocket expense could be as high as $20,000.
- There are some “issues” – one or more of the following are TRUE:
- The house might require some repairs or maintenance.
- You’re in a hurry to sell due to a life circumstance or cash shortage and can’t afford to maintain the property.
- You aren’t sure about the title or you know that there are issues.
- The mortgage, HOA fees and/or property taxes are not up to date which encumbers your ability to sell the home.
- You’re not sure whether or not the house is worth enough money to spend the time, energy and funds necessary to sell it.
If you’re in the first “everything is perfect” category then what you really need is a great listing agent. Someone you can trust to take your home and market it in a self-sufficient manner that doesn’t require your oversight. I would recommend not signing up with the first friend of a friend you’re introduced to. Do some research online and try to determine who the best Realtor in the space is. We are equipped to help you in this arena! If you’re interested please contact us for an agent referral.
If you’re in the second category, you have a slightly tougher job but it’s not impossible! We can show you how:
- The house needs some repairs
For an out of state home owner, a house that needs repairs is possibly one of the most difficult situations to deal with. Because you’re not there it is very hard for you to deal with the day to day elements involved in getting bids, coordinating contractors, reviewing work, etc. etc.
The very first thing you need to do is arrange a consistent, reliable and (most importantly) safe way for you to ensure you can arrange access to the house. In order to begin the repair process you’ll need to provide access to various vendors just to get an approximate cost and turnaround time on the work required.
In some cases you might have a friendly, retired neighbor that doesn’t mind the hassle. If you happen to be in that position count yourself lucky! If that’s not an option there are still some things you can do:
- Have an electronic entry mechanism installed that allows you to control entry to the property from your smart phone. These aren’t quite as expensive as they sound but they can still be cost prohibitive at around a thousand dollars. You also have to figure out how to get it installed!
- You can have a key code lock box placed somewhere that holds a physical key. When you want to give someone access you just have to give them the code to the lock box. The issue here is that you’ll need to trust people to return the key to the lock box.
- You can have pin code entry systems installed on the front door or garage that allows people to enter. These tend to be the least secure but most convenient.
Once you have a method of allowing access it’s time to start hunting for a contractor! Because you’re out of state we highly advise against trying to find individual tradesman and manage the process yourself. Contractors are generally more expensive but it will be worth it to have someone on-site that you can trust to manage the process as a whole.
Interviewing contractors remotely shouldn’t be a problem at all. Find the five with the highest reviews online and give them a call to explain your situation. Once they have access to the house they should be able to provide you with a free estimate for what they think is necessary to bring your house to market ready condition.
While this usually goes without saying try to avoid the cheapest and opt instead for the one who offers the most value. Competence is worth paying for especially if you’re not available for ongoing quality control. Think of your contractor as your eyes and ears during the repair process.
With digital technology getting updates on the repair job should be easy. Ask your contractor to take pictures of the home with their smartphone and email them to you. When the repairs are complete it might be worth hiring an independent third party (like a home inspector) to review the contractor’s work.
- In a hurry to sell fast
If you need to sell your house fast you typically don’t have a ton of options, especially if your property has other issues. The best thing to do in this situation is reach out to a cash buyer like gwg properties. We can give you a fair cash offer within 24 hours and close on your house in as little as three days. If you’re interested in a fair cash offer please fill out the form at the top of this page and we’ll get back to you immediately.
- Potential title issues
Title issues can completely derail your ability to sell the house. The best thing to do if you’re not sure about the cleanliness of your title is to hire an attorney or a title company to order a title search. This will cost you some money but is absolutely worth it due to the visibility it provides. This is relatively easy to do remotely so the fact that you’re out of state shouldn’t cause any issues.
If you find a problem (or you already knew one existed) you will need to fix any title issues before you’re able to sell. In most cases this means negotiating with a lien holder but it can also require interfacing with government agencies. In situations like these, experience is worth its weight in gold and we highly recommend that you find a real estate professional to conduct this negotiation on your behalf. Whatever it costs you on the front end will save you many multiples on the back end.
Again, because you’re interfacing with these organizations electronically in most cases you shouldn’t have any trouble correcting title issues as an out of state home owner.
- Payments aren’t up to date (mortgage, HOA, taxes, etc.)
If you are behind on your payments and you want to sell your house you actually have more options than you may think. In many cases, due to the recent economic meltdown, banks are becoming more receptive to the idea of a short sale. Its important that you communicate with your lender and keep them abreast of the situation at all times. Avoiding them can only cause problems while being communicative can usually yield at least some kind of compromise.
If you’re able to negotiate a short sale approval with your bank the next step is finding a listing agent that specializes in short sales. Again, don’t sign up with the first best friend’s nephew who flashes a real estate badge. Find an agent with short sale experience who can show you examples of successful deals.
If you’re behind on other payments outside of your mortgage (HOA, property taxes, etc.) then you might be in a slightly tougher spot. Negotiating with one potential lien holder has a much higher success rate than trying to keep multiple parties at bay. In these cases we recommend you find a seasoned real estate investor who can assess your situation and help find a solution. Depending on your equity position, you can end up selling your house to a cash buyer who assumes all of your debt and liabilities and still pays you cash for your home.
Again, if you’re interested in speaking with a professional please contact us to discuss how we can help you in these types of situations.
- The cost of selling the house (the equity question)
One of the biggest problems you’ll face when selling your home (regardless of whether or not you’re in state) is the actual cost of selling a house. Between Realtor commissions (an industry standard of 6%), closing costs, inspection fees, recording fees, transfer fees, etc. you can end up paying 10% of the total purchase price of your home just in fees and commissions!
That can be a huge number. On a $200,000 house you’ll end up paying $20,000 just to sell your home. If you’re not sure your house is worth enough to justify a traditional sale then it’s worth looking at alternative options. Specifically a cash buyer like GWG Properties that not only pays you a fair cash price but also pays ALL fees and closing costs.
Trying to sell a house when you’re out of state can be a difficult prospect but, as you can see, its not impossible.
If you have a property problem that you’d like solved contact GWG Properties. We’ll give you a same day cash offer on your property as well as honest advice on your options.