Many homeowners choose to sell their homes without the assistance of a real estate broker. This is generally referred to as for sale by owner (FSBO), and it can save thousands of dollars in broker fees. Likewise, many home buyers choose to work directly with the seller to avoid the costs associated with hiring a real estate broker.
However, the dream of saving money can quickly turn into a nightmare if you are not prepared.
What should I know when considering a FSBO?
A contract to buy and sell real estate is a serious, legally binding contract, with many financial and legal consequences. And, it is only the beginning of the legal process of buying or selling a home. Once you have an executed contract, you still have due diligence deadlines, title reports, settlement statements, the deed and other closing documents to consider and review.
If you are thinking of buying or selling your home as a FSBO, you should consider the following:
- You are not creating significant legal liability for yourself
- You want to ensure that the contact is properly drafted
- That you provide or receive all the proper disclosures
- That you provide or receive a proper deed at closing
- You need guidance on the process from signing the contract to the closing date
And ask yourself the following questions:
- Do you understand the difference between specific performance and liquidated damages?
- As a seller would you prefer to deliver a special or a general warranty deed?
- What about the buyer?
- What kind of survey should the buy demand?
- When should the inspection deadline be set?
- What about the disclosures, the mortgage, the survey and due diligence deadlines?
- Which title company should you use?
- What do you do if the seller or buyer wants to cancel the deal?
If you need help with any of these considerations or questions, our experienced real estate attorney can help you.
How much money can you save?
A FSBO can save you a significant amount of money. For example, if you sell your home for $400,000 you could save as much as $22,500 when compared to a traditional 6 percent listing contract with a broker.
Instead of working for a commission, Robinson and Henry charges a low flat fee, saving you thousands of dollars on brokerage fees.You also get the value of having an experienced real estate attorney on your team as opposed to the limited services provided by a real estate agent.
The low flat FSOB fee includes the following professional services:
- Preparation of the buy and sell contract;
- Individual consultation to explain the nuances of the contract and how it is crafted to favor you;
- Preparation and individual consultation on all counteroffers or amendments to the contract;
- A detailed review of all critical dates and deadlines from contract date to closing date;
- A full legal review of all title work followed by a discussion of any matters that may affect your legal interest in the property;
- A full legal review and individual meeting on all closing documents and settlement statements.
Our clients also appreciate the value of hiring a lawyer.
“We did want to thank you for all your help and advice. We had never done a “for sale by owner” and were a bit unsure of what to expect throughout the entire process. Your expertise and guidance through the contract process not only put our fears at ease but saved us quite a lot of added expense had we done this with a realtor. We will certainly look to you for assistance should we go through this again.”
– Jim, a For Sale By Owner Client
Selling or buying a home is the biggest financial transaction of many people’s life. It makes sense and gives you peace of mind to hire an experienced real estate attorney before initiating the contract. We are committed to helping you succeed. Contact us for a free, no obligation consultation at (303) 688-0944.