In today's market, many homeowners choose to sell their homes themselves. For Sale by Owner is often referred to as FSBO or "fizzbo." As a potential buyer, you may be a bit uneasy house hunting without the advice of a realtor. Our advice - don't overlook these properties. Why? FSBO may give you a less inflated price and more room for negotiation.
Here are some tips on looking at and buying a FSBO Home:
Tip #1: Find a Good Lawyer
If you are looking in neighborhoods where there are lots of nice FSBO homes, make sure your lawyer has experience handling this type of sale. A good lawyer will take over many aspects of the sale traditionally handled by the realtor. They will manage the process from offer through closing including inspections.
Tip #2: Don't Take A Realtor on a FSBO House Hunting Trip
Don't ask your realtor to go with you to visit a FSBO home. If you do, you may have to pay him or her a commission out of your own pocket.
Tip #3: Request a Disclosure Sheet
Required homeowner disclosures vary from state-to-state. Be sure to request a disclosure sheet from the homeowner.
Tip #4: Get Historical and Neighborhood MLS Listings
If you find a FSBO home that you would like to make an offer on, request historical MLS listings for the home from a local real estate office. And, get MLS listings for other homes in the neighborhood. It's helpful to know what the homeowner paid for the home and what other houses nearby sold for both recently and historically.
Tip #5: Ask for an Overview of the Homeowner's Offer & Bidding Process
Handling negotiations is often an uncomfortable role for the homeowners, but it's one that they have chosen to handle. Have the homeowners outline the offer and bidding process upfront. Ask if there are other interested buyers or offers on the table. If there are multiple bids on the home, ask if you will be able to make a follow-up bid after your first offer. This will help you make an informed bid.
Tip #6: Get Your Lawyer Involved from the Start
For Sale by Owner doesn't mean that you, the buyer, has to go it alone. Remember, your lawyer will be your key advisor throughout the home-buying process. Get them involved from the start! Make sure that your lawyer reviews the offer sheet. Also, ask your lawyer what you should and should not discuss with the homeowner. After your offer is accepted, your lawyer will guide you through the contract negotiations, inspections and closing.
