If you have been in the real estate business, you may have come across homeowners who do not use agents to sell their homes. Though such properties are not too common, some people assume that for-sale by owner (FSBO) deals may have some issues. They think that the seller may not be serious or they may not be willing to negotiate, but these assumptions may be incorrect. The prices of such deals can still be flexible especially if the seller has sold a house without a real estate agent before.
Purchasing such property is somehow similar to buying any other home that has a real estate agent. It only differs in that in this case; someone must take the responsibilities of the missing agent. You should hire a buyer’s agent even if the seller does not have their own agent. The seller will still have to pay your agent; therefore, you don’t have to worry about an additional fee on your side.
Most buyer’s agents are not excited in working on FSBO deals because they know that it means they have to take up more responsibilities that they would have if the seller hired their own agent. Your agent has to do work from both parties. Ensure that you get one to help you with the entire process. As you consider buying the home, you should begin with drafting a purchase contract. Get a real estate attorney to confirm that your rights are protected during the transaction and represent you legally.
A real estate attorney can come up with the relevant documents at a reasonable cost. Purchase contracts are also available online, therefore, download them and fill them correctly if you don’t hire a professional. As you handle the documents on your own, remember to offer a lower price than the listed price. Do not start high because the negotiations cannot go down. Ensure that you check the comparables around the area as you prepare yourself for the negotiations.
Though both parties are looking forward to closing the deal, you should always have a way out of the deal if you are not satisfied with the terms or find defects on the property. Get a third party to hold your earnest money on your behalf to avoid giving it to the seller. You should also agree on who should pay for specific fees. Someone has to pay for the transfer taxes, title fees or even escrow fees.
Be specific on when you need to take possession of the property. Though most sellers give possession to the buyer during the closing day, it is not a must. The seller may need some time to relocate from the property. Therefore it is good to specify the date of possession.
Do not forget to buy title insurance. You would pay less in buying insurance compared to the costs you would incur to dispute easements. Just like selling a house using a real estate agent, FSBOs follow the same laws. The seller has to reveal all the information regarding the property and provide federal disclosures.