When working with a realtor how do for sale by owner houses work?
Posted on March 19th, 2010 in FSBO - News
I have been working with a realtor and seeing houses. With him I found a neighborhood that I really like. We decided to just wait until something in that neighborhood goes on the market. I have now found two in that neighborhood, but they both for sale by owner. How do I handle this? Should I do it on my own or stick with the realtor? I’m a first time homebuyer and would like to have someone like a realtor to walk me through the process. I’m not under a contract with the realtor, but feel guilty just doing something on my own. I don’t want to miss out on the home just because of a realtor. Any ideas?
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Where is the best place online to advertise a for sale by owner house?
This post has 5 comments
March 19th, 2010
You can go through your realtor or on your own. Since you’re first time the realtor might be a better idea to address the necessary issues. For sale by owner means the owner handles everything themselves, so they don’t have to give a piece of their profit to anyone.
March 19th, 2010
GO THRU YOUR LAWYER YOUR REALESTATE PROFESSIONAL MAY
GET ANSI*** LET REALESTATE LAWYER MAKE THE OFFERS..
REMEMBER, A LAWYER IS TEN TIMES BETTER IN THIS THAN A
REAL ESTATE BROKER, SALES, WHATEVER…DO NOT FEEL GUILTY>
YOUR
March 19th, 2010
You do not a real estate lawyer. Who is going to pay for that? See if the FSBO (For Sale By Owners) would be willing pay a "buyers commission". Most agents won’t even show you homes that are FSBO because they normally don’t get a commission. Ask the owner first, then talk to your agent. If the agent didn’t have you sign a "buyers agent" form, then that is the agents fault. Usually, that is the first thing that should be done with a client.
A few things to know about FSBO. They are usually selling FSBO because they can’t afford the commission (upside on their mortgage), they are trying to hide something, or they just know what they are doing and don’t want to pay a realtor.
Really, most of the work is done by the mortgage company. Make sure you get a property disclosure form on the house, get a home inspection! Also with FSBO, they don’t have their homes priced right, sometimes a little higher, sometimes way lower. Last thing you want to happen is find out that you offered $100,000 and the house only appraises at $85,000. A realtor would be able to tell you what the area is selling for.
Best of luck!
March 19th, 2010
In reality, the For Sale By Owner does pay a commission to your agent. This is normally 3%. However, if you choose to go to the For Sale By Owner directly, you will substantially increase your liabilities. Your Realtor will help you catch red flags. As a buyer, you don’t pay commission.
The For Sale By Owner would still pay your Realtor a commission. However, most For Sale By Owners don’t know the technicalities, paperwork, red flags. Therefore, your Realtor will probably end up doing twice the work, offering his expertise, explaining contracts,etc to both of you, even though they are getting half the commission. If at all possible, buy a property that’s represented by a professional.
Some appraisers, if not all, will reduce/adjust the fair market value of the home by deducting the commission "saved".
So, it’s possible that the home will not appraise. Make sure you ask good questions from your Realtor and have them make sure your offer is a fair one. In my opinion, your offer should be reduced by at least about 3%. So, in reality, i’m not sure what you are gaining by buying this property and what the seller is gaining.
However, if you really love the property, then I would suggest using your Realtor.
May 10th, 2010
You can go with your Realtor if you like assistance and hassle free. But since it’s the owner of the house who is selling it, you can go your own and negotiate with the owner. So I think the owner will be the one to handle everything needed in the process of selling it and for sure you can save more for it.