In a down market, financing is often tight for buyers. Even creditworthy borrowers get rejected because of rigid underwriting. In order to facilitate a sale, consider financing the deal yourself -- called “seller financing.” By financing the sale, you may sell your home sooner and enjoy a financial return for the effort.
How does seller financing work? With seller financing, the seller acts as the lender, but rather than actually loaning cash, he or she extends credit against the purchase price of the home. The buyer signs a promissory note and trust deed in the seller's name. If there's an outstanding mortgage, the lender must agree to the deal. There are numerous variations, including equity sharing, lease options, financing only a second mortgage, and more.
You'll need to check with a real estate attorney or other professionals proficient in seller financing contracts to learn more and to determine if you can handle the risk.

Reason #1: Reassure prospective buyers.

Even after a walk-through or two, buyers rarely know exactly what to expect from a home inspection -- there's always the possibility of termites gnawing on that rustic log cabin or faulty wiring lurking behind those faux-finished walls. Providing a pre-inspection assures the buyer that no major surprises are in store; while they might not waive their own follow-up inspection, they'll at least feel more comfortable about placing a bid.

Reason #2: Buy time and save dough.

Even in a relatively new or completely renovated home, chances are a licensed home inspector can find a red flag or two. After all, that's their job. When a fault is found during a typical home inspection, you may only have a few days to decide whether to make the repair or adjust the sale price appropriately -- and you'll need to find a solution that satisfies you and the buyer. A pre-inspection gives you more time to compare prices and treatment options from a variety of contractors. You may also avoid conceding a "huge chunk of change" for unpredictable repair costs like mold remediation or structural work.

Reason #3: Know where you stand.

Generally, your final selling price is determined long before the inspector ever sets foot inside your door. That leaves a huge question mark lingering over your negotiations -- are you going to be forced to drop your final figure again if a major problem is uncovered? By getting an inspection early, you'll know what concessions a buyer might request. That allows you to set your asking price accordingly and find out whether or not you're in a position to play hardball.

Reason #4: Prevent repeat repairs.

No matter how handy you are, there's always a risk of misdiagnosing a problem. But getting your home pre-inspected could help you avoid wasting money on unnecessary repairs. Perhaps your toilet hasn't been flushing quite right, so you pay a plumber to replace it -- only to learn upon inspection that the problem was in your septic system. A pre-inspection helps you avoid doing double-duty, since the inspector can pinpoint the problem and recommend the right repair.

While the average home inspection costs a few hundred dollars, it can save time and money in the long run. To find a home inspector in your area, visit the American Society of Home Inspectors at www.ashi.org.

Improve but don't overdo it. Home improvements completed before a sale should only include changes that give your home a more contemporary feel.
For example, consider:

 

• Installing new major kitchen appliances, but only to replace outdated, inefficient models.
• Painting your home in neutral colors.
• Getting new floor and window coverings.
• Replacing or repairing a leaky roof.

 

Avoid kitchen and bath remodeling jobs, or major renovations and additions. Giving the buyer a cash incentive for later improvements is often more attractive to buyers in a down market than making improvements that may not fit a buyer's lifestyle. The bottom line: Try to strike a balance between the needs of cash-tight buyers who want the home to be move-in ready, and those who will have money to make their own improvements.
Improve your home’s your curb appeal. Curb appeal is the first impression your home conveys to prospective buyers. It should arouse in home shoppers an emotional desire to own the home and entice them to cross the threshold.
In a buyer's market, simple cosmetic makeovers don’t cut it. Instead, invest in minor home improvements or an exterior staging job to increase the curb appeal. In addition, remove clutter, tidy up the grounds, wash the windows, repair fences, fix driveway cracks, hire a landscaper, and consider painting the exterior of your home. Make it sparkle like a model home.