Thinking about selling your home ‘By Owner’?
Selling your home by yourself is a risky venture to say the least, but the appeal of saving money on commissions is worth the risk for some. There are so many ways a seller can be hurt legally, financially and criminally in this day in age, and I recommend that you seek the advice and service of a Realtor® instead of doing it yourself. That being said, if you’re going it alone anyway, here are just a few of the many things to consider before you take on this project.
Are you behind on your note?
Are you ‘upside down’ on your mortgage (owing more on the home than what it’s worth)? If your only option is either a short sale or face foreclosure, selling your home by owner is not an option for you. Your lien holder will not approve a short sale unless there is an agent and/or attorney involved in your transaction. My best advice if you are in this situation is to contact an attorney that specializes in Bankruptcies and short sales. If your home is in Western Washington, I have a referral attorney for you.
Contracts and legal details
If someone expresses an interest to buy your home, what are you going to do? Do you have a purchase agreement ready to use? And if so, where did that paperwork come from? Agents are required to use pre-made forms written and approved by the attorneys for their local MLS, and are not supposed to give away blank forms for private parties to use. If you have possession of blank legal forms that have a local MLS logo somewhere on the forms, and you are not an agent, you shouldn’t be using them – this alone could cause legal problems for you and disciplinary problems for the well-intentioned agent that gave them to you. It is also important for you to be up to date on current laws in place that govern the sale of Real Estate in your area, and to make sure you are doing everything necessary to be in compliance. Ignorance does not exempt you from the law, and your best bet is to get help from an attorney that specializes in Real Estate contracts, as there is NO fool proof ‘For Sale by Owner Kit’ available at an office supply store.
Limited exposure to the best buyers
Pre-approved buyers are being updated by their agents with information directly from MLS, so you are going to have to figure out how to compete with that to gain their attention. Some of the consumer MLS search sites will offer owners the option of advertising their homes without an agent, you should search around online to see what options may be available to you. Additionally, signage is important. Check with your HOA before posting signs in your yard or around your neighborhood, and add directional signs around busy streets to divert people to your home.
Is your home show ready?
Inside and out, your home needs to scream curb appeal. Cut your grass, plant flowers, clean your driveway and pathways, and ask your surrounding neighbors to help you with your goal by following in suit. Every time you open up your home to a potential buyer, your home should look the part and be show-ready.
Is that ‘interested buyer’ actually a buyer?
How do you handle showings and open houses? Are you just going with your gut and winging it, or are you going to do any screening? It can be hard to know who is a qualified buyer, and who is casing a home out to come back later when you’re not home. Be cautious. Don’t have any valuables out during open houses that can easily be taken, and have people fill out a guest register near the front entrance. If you want to be even more cautious, advertise ‘by appointment only’, and ask for a pre-qualification letter from their lender prior to the showing.
What is the value of your home?
Contact a local appraiser and have your home appraised. There is obviously a cost involved in doing so, but your appraiser may also help point out conditions relating to your home that may be an issue for your buyers financing. You could also contact a local title company, and hire them to be your escrow when you have a buyer for your home. They are able to help you with searches for recent neighborhood sales to determine your homes’ value.
Buyer has an agent
One more thing to consider is whether or not to work with a buyer’s agent. Likewise, a buyer’s agent also chooses whether or not to work with FSBO’s. There is onerous liability involved with just about everything a licensed agent is involved with these days, and selling a ‘FSBO’ is no exception. Buyer’s agents will mostly prefer to just sell MLS-listed properties, as they involve less legal challenges, an established commission amount, and another professional to work with that is representing the seller. Offering a Buyer’s Agent Commission is all well and good, but keep in mind – they will end up doing the work of a Buyer’s Agent and a Listing Agent for that fee if they choose to take the sale on.
Hire a great Realtor instead
We have just scratched the surface here of things to concern yourself with when attempting to sell without professional help. I truly understand the appeal of saving money on commission, as I also understand how hard we work to earn it. Please call me first before you make that decision, I may be able to help offer you a solution that you might not have considered. Heck, I may already have a buyer for you.