Selling a rented home can pose challenges

NORTH BETHESDA, Md. – Jan. 25, 2012 – Some homeowners turned into reluctant landlords and rented out their homes to earn extra income while the housing market was sluggish. But now some of these homeowners are ready to sell.

However, real estate agents often caution clients that trying to sell a home when a tenant still lives there can be tricky since many renters – who have no financial stake in the matter – aren’t always so eager to help market a home and keep it tidy and neat on their landlord’s behalf.

Nevertheless, “it’s pretty common in this market to be selling a home with a tenant in it,” Chris Hager, a real estate professional with Long & Foster Real Estate in North Bethesda, Md., told the Washington Times. “There are lots of reluctant landlords out there who opted to rent their property rather than sell it, and now they want to put it on the market. There’s the potential for conflict between the tenant and the landlord, especially if it was not made clear to the tenant from the beginning that the owners wanted to sell.”

Landlords should make a point to clearly communicate their intentions to sell, and not “sneak” the house on the market without telling the tenants first, real estate professionals say.

Landlords might want to offer a concession on the rent to tenants in exchange for them keeping the home in clean, good condition while it’s on the market – such as 10 percent off each month’s rent while it’s on the market. But be sure to communicate expectations for cleanliness, such as keeping the dishes out of the sink and making the bed. Experts also suggest setting established hours for showing the property to make it easier on the tenant.

“You never get a second chance to make a first impression, so it is particularly important to have the place in strong showing shape on the first and second weekends on the market,” says Nick Pasquini, broker-owner of Century 21 Redwood Realty in Washington, D.C., and Arlington and Ashburn, Va.

3 ways to sell a home that’s not selling

NEW YORK – Jan. 20, 2012 – Surveys suggest that a high number of real estate deals are falling apart due to financing issues, and today’s sellers might need to get creative if they want their property to sell. Options to consider:

• Sellers could back a second mortgage for the buyer at an amount that enables the buyer to meet the lender’s downpayment requirements, providing the lender agrees.

• Sell the home “subject to the existing mortgage,” which means the buyers take over the sellers’ existing mortgage payments for a specified time, after which time they must obtain a new loan. This arrangement relieves sellers of their mortgage debt and helps buyers with credit scores too low secure a traditional loan. And while it forces buyers to get a mortgage as specified in the contract, experts say banks will not foreclose if payments are made on time.

• Sellers willing to finance the sale can unload properties for a low downpayment by adding a sweat equity clause to the contract, which requires the buyers to bring the home into tip-top shape. The renovation details are written into the contract, and buyers must complete the repairs by the agreed-upon date to qualify for long-term seller financing.

Source: RealtyBizNews (01/16/2012) Robinson, Donna

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