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4 Easy Ways FSBOs Can Go Sour

First Team Real Estate

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June 23, 2015

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When you first consider listing your home, For Sale By Owner – commonly known as FSBO – can seem like a great idea. You can save money and it’s easy enough to figure out with the wealth of knowledge available at your fingertips, right?While we strongly believe you can do anything you put your mind to (go you), are you ready for the headaches that come along with all the responsibilities of selling your own home? There’s a lot that goes into selling a house – that’s why it’s a full time job for real estate agents.A real estate agent spends a lot of time avoiding problems before they happen and solving them when they do. Here are just a few easy missteps and sour spots you could hit if you try it alone.

man biting lemon with squished face

Never-ending negotiations

Negotiating with a prospective buyer can take weeks or even months to get all the kinks of price, add-ons, fixes, inspections, and more worked out. Plus, when you’re in charge of your own home sale it’s not just the prospective buyer you’ll be negotiating with. You’ll also be negotiating with:

The buyer’s agent (who will be coming to bat for their client’s interests)
Home inspection companies
Home appraiser if there is a question of value
Possibly the bank in case of a short sale

How many rounds are you ready to go? If you’re not on point and ready to negotiate with each and every party during the process, then you could be losing money, time, and a bit of your sanity.

Trouble finding buyers

Recent studies have shown that 92% of buyers search online for a home. That is in comparison to only 28% looking at print newspaper ads. Most real estate agents have an extensive Internet strategy to promote the sale of your home. Do you?Plus, agents who have worked in the business have built up years of relationships with buyers and sellers, other agent friends working with buyers, honed marketing strategies to attract clients on and offline, and more. That means they will bring more buyers to your doorstep. More buyers = more offer and better offers.

The paperwork

A homeowner who fails to fill out the required legal paperwork can lose a buyer, have a deal fall through or face legal action after the sale is completed. Here’s a quick look at that paperwork you’ll need to start tackling:

Property disclosure – List of all the defects your home has. Check out these 9 seller disclosures you never realized you needed to fess up to.
Disclosure of any lead-paint hazards (on a separate form) if your house was built before 1978 under federal law.
Sales contract – Including price, contingencies and special conditions.
Property tax receipts.
History of homeowner’s insurance policy.
Occupancy agreements – Depending on your circumstances you’ll need the pre-occupancy or post-occupancy agreement.
Documentation of outstanding liens.
Documents related to title and ownership of your home, including a property survey, certificate of occupancy, certificates of compliance with building and zoning codes, and more.
Receipts and documentation of improvements you’ve made to your house, such as adding a new bathroom.
If you are in a homeowner’s association, all related documents, such as CC&Rs.

Trust us, the list goes on and on. And if it’s not all completed with your T’s crossed and your I’s dotted, you could be open to future litigation and legal troubles.

Are you really saving money?

According to the National Association of Realtors, in 2013 the average For Sale By Owner home sold for $184,000 while the typical house sold by an agent sold for $230,000. That’s because agents can get more for your home and most importantly, buyers offer less for FSBO homes because they know you’re not paying a commission.Keep in mind as well that things like commission (for the buyer’s agent), a home warranty, and closing costs are all negotiable and without a sellers agent on your side, you’re going up against an experienced buyer’s agent which means you could end up with the short end of the stick – and stuck with a higher bill.Selling your home is stressful enough without having to take on the added responsibility of going it alone. To avoid these sour situations and save yourself time and money, find an experienced agent near you to get you through any sour situations that arise. Call or email us or start browsing for an agent near you on FirstTeam.com.