Forbrukslån: Selling a House without a Real Estate Agent
Property owners spend a lot of money and time building up their home’s equity. So it is not surprising that most of them would resist the idea of parting with 6% of their property’s value through real estate commissions when it is time to sell. So the FSBO or For Sale by Owner approach – selling the home without the help of a broker or real estate agent – can be a pretty attractive option. There are questions people need to ask before hopping on the train:
- How to sell the house without a real estate agent or broker?
- What do people need to know?
- What tools are readily available to help sellers?
- What are potential shortcomings?
Selling the house without a broker or real estate agent
The first thing people need to know when it comes to selling a house without a real estate agent is there is a reason why these professionals’ commissions usually amount to about four to six percent of the property’s selling price. There is a lot of work that goes into selling houses.
And if individuals take the FSOB approach, they are going to be doing all the necessary work themselves. Finding out the right selling price of the property is only part of it, although a lot of people assume that it is the main advantage of having a broker.
But these professionals provide tons of other services as well, such as advertising listings, showing properties to possible buyers, helping ensure disclosures and other legal requirements are well taken care of, guiding individuals through the closing process, as well as making sure all the things in the checklist are crossed, and documents are properly signed.
When it comes to FSBO, people are doing all these things by themselves—or paying other individuals to do it for them. Vendors should not expect to pocket the savings from the broker or agents commission themselves. Whoever purchases the property will most likely want a piece of these savings and get a much lower price – that is why they are looking at an FSBO in the first place?
If the buyer is using an agent, that professional will want to be paid the half of the customary broker’s commission they usually receive; usually two to three percent of the home’s sale price – which is paid by the sellers, though the amount is pretty negotiable.
Plus, individuals may incur other charges like appraisals, lawyer fees, and advertising that will cut their savings. If vendors are still not interested, here is a step-by-step look at what people need to do to sell their house without a real estate agent.
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Pricing FSBO properties
Getting the home price right considers the biggest challenge in selling a house without a broker – and one where mistakes can have serious and life-altering consequences. If the seller prices their house too low, they risk wiping out the savings they are trying to get through a For Sale by Owner.
If the price is too high and it may not sell – and even if the sale gets a buyer, owners may not be able to get a housing loan if the house does not appraise for what they offered. In pricing a property, sellers should be wary about using automated pricing systems such as Trulia or Zillow.
While these things can provide a rough estimate of the property’s value based on the nearby sales and square footage of the house, they do not do a pretty good job of taking into consideration the conditions, as well as other individual features of the house that can affect the price.
Although, these things are convenient and efficient for finding out what other properties have been selling for. The best way to price a house is to spend a couple of weeks visiting open homes in the area to get a better understanding of what individuals are asking for houses similar to the one they are selling.
Then, they can set their asking price accordingly. Sellers should also make sure they are always ready to negotiate. Hiring professional appraisers for a couple of hundreds of dollars is also an excellent idea to get professional valuations. It will likely be similar to valuations mortgage lending firms will get, so they do not run into any surprises with prices too high to support debentures.
Get a reputable professional for help
At the very least, sellers should get a lawyer that specializes in real estate to help and advise them on things like drawing up sales contracts, ensuring compliance with relevant regulations and laws, as well as identifying disclosures they are required to make. Title firms can usually supply this kind of expertise and handle closing processes as well, including preparations of all documents that are needed.
Real estate lawyers can also advise individuals on what buyers or sellers customarily pay fees and charges in the area and which are subject to negotiations, which is something agents would usually help them with. Sellers should also need to be aware of any contingency clauses in sales contracts and which ones they should insist on, as well as the ramifications of one property buyer may look. Again, real estate lawyers can advise their clients here.
Listing for FSBO
Individuals may be surprised to learn that they can list an FSBO house on multiple listing services or MLS. This listing is the most comprehensive listing of readily available houses for sale in the given area. Some companies will do this for customers for a small fee.
Most of these FSBO sites will put a person’s listings on multiple listing services and their own website and provide other important tools for selling a house without an agent. Sellers can also use websites like Craigslist and other non-multiple listing service sales listings, which can save them a couple of hundreds of dollars.
But the Multiple Listing Service will get them the best exposure. People should also consider preparing things like flyers, handouts, yard signs, and other promo materials, as well as assorted costs. But most FSBO services will now include these charges in their costs.
Identifying possible buyers
When individuals are selling their homes without an agent, they are in charge of showing their property to potential buyers. They do not get a slip out for a couple of hours while the broker shows off the property’s features and provides sales pitches to possible buyers. That is the owner’s job.
People also need to take on the job of checking out qualified buyers. They are going to get a number of people looking around and kicking tires. Sellers should not want to waste their energy providing them with their best sales pitch.
Sellers also do not want to be in a situation of accepting offers from individuals who are likely to qualify for a housing loan and months with their house effectively off the market while trying to get approved for a debenture unsuccessfully.
Do they have prequalification letters from lending firms? If so, the lending firm has already determined they have the income and credit to get a housing loan of a particular amount. People should also be aware that For Sale by Owner houses tend to attract individuals that love lowball sellers.
They will offer the seller a price below what they are asking, hoping they have gotten frustrated or desperate enough to accept it. But they should not assume these offers mean sellers have overpriced the property, especially if they have only had it on the housing market for a couple of years.