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For Sale By Owner May be a Risky Affair for Many

November 20, 2017

Real estate transactions in our modern time are actually very complicated endeavours which hold many variables. Specialists all over the world try to become better at the real estate services they offer and this is why they are constantly aware of changes in the sale process. Of course, they charge fees for their assistance and some homeowners don’t like this.  For Sale By Owner is absolutely possible and it happens on many occasions. Opinions on such transactions are polarizing as there are both advantages and disadvantages.

 

Supporters of the For Sale By Owner deals will tell you that a very important part is the money saving aspect. By not hiring a realtor you will also avoid paying commission. The size of this fee is typically 2.5%-3%. You understand that if you sell your house for $700,000, you will owe about $21,000 to your broker, right? What every person looking to sell their house must decide is whether this is worth it. An argument can be made that at the end of the day the numbers do not add up and many homeowners end up with a bad deal.

 

Another argument defending the For Sale By Owner idea is that nobody knows your home better than you do. That means that once you start bringing in potential buyers you will personally be able what is wrong and what is great about this house. Realtors tend to add a little fluff to each property they try to sell. So if you don’t have a real estate agent, then you will do just fine according to many.

 

As mentioned in the beginning of the article, real estate sales are tough deals in terms of paperwork and procedures. We will try to list some of the difficulties which might arise as you try to complete an For Sale By Owner deal. We will talk about what you should watch for and meanwhile, we will give you a few extra tips.

 

So once buyers and realtors see the For Sale By Owner sign on your lawn, phone calls may or may not start pouring in. Unfortunately, the first ones to call you might not be exactly goodwill. While most brokers will, in fact, encourage you to try a For Sale By Owner sale initially, there are some who will look to take advantage of you. You need to watch for “Preview brokers”. These guys will tell you that they might have a buyer for you and that they would like to take a look at what you offer. The catch is that they will come alone and they have no intention of letting you sell your house on your own. Their goal would be to lure you to hire them. There is one effective way to get rid of them. As such as broker for a pre-approval letter of the buyer in question. If they refuse to send you such a document then get rid of them.

 

Another group of people looking to trick you are the so-called "tire kickers". These are on the buyers' side. They will target you and wear you down with questions. Their goal is to make you lower your price as they are perfectly aware that you do not have professional representation. If you sense that a buyer is all of a sudden very keen to talk to you and ask you questions then you can be sure that they will try whatever they can in order to lead you to lower your price.

 

In order to avoid most obstacles along the way, you would need to take some time and devote it to preparation. For Sale By Owner also means that you are on your own when it comes to all the details concerning the sale of your property. Spend some money and hire a photographer in order to get the finest pictures of your home. That stuff really matters as every potential buyer has to like what they see online before they actually pick up the phone to arrange a meeting with you.

 

Second of all, you simply must get all the data right before posting your home for sale on MLS or Zillow. In order for it to pop out in searches, you will have to get accurate data regarding size, price, repairs and many other components of your home.

 

Since we are still on the data topic, the disclosure statement is something you need to take very seriously. This is a sensitive matter which becomes even harder to handle when you aren’t represented by anyone. You are obligated to say everything you know about the property. Many times a For Sale By Owner deal falls through because the disclosure statement has been neglected. That being said, if you wish to conduct a For Sale By Owner deal, it is unlikely that you will be able to close it without having to hire an attorney.

 

Getting buyers is also not going to come easy. You may have to devote more time to your sale than you thought. Since there won't be a broker to greet them in, you will need to be constantly available and open to visits from potential buyers. If you have a day job, then you will somehow have to manage. Unfortunately you probably (most likely) do not have a list of active buyers and will take some time before serious people start coming in. Additionally, a broker will also have a list of pre-approved buyers. This means that his clients have their background checked and that they are good for the money they offer.

 

Eventually, you will still need to deal with a buyer's broker and will have to pay them a fee. Sure it won't be a collective 6% but it will still be 3% of the sale price. If you are looking to pursue a successful For Sale By Owner transaction then you better be good at negotiating and perfectly aware of the procedures and deadlines.

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