OT: Anyone buy a house from someone - For Sale By Owner
I am just curious if anyone has bought a house from someone who didn't use a realtor. For Sale by Owner and what your experience was with that.
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i have. the seller was
i have. the seller was experienced enough that she already had an attorney lined up to do the closing. the hardest part for me was dealing with the bank for the mortgage.
Is the mortgage different
Is the mortgage different when you do FSBO? Or are you just saying in general, it was the bank that was harder to deal with then the FSBO?
just in general. nothing to
just in general. nothing to do with the seller not being an agent. i actually preferred going with her as she gave me a key and let me paint and start moving some stuff in several weeks prior to closing.
Did you find a house you
Did you find a house you like?
Maybe. Friends of ours... the
Maybe. Friends of ours... the mother died and they (along with 2 siblings) are very motivated to sell. The house needs updates (haven't seen the inside yet, going to do that tonight) but the outside is really nice and the neighborhood is AMAZING. It's like one of my dream neighborhoods for our city.
They had a realtor come in and gave them an idea of what they would start with for the house. It is in our price range. High end but considering the property and location it would be worth it. (and our price range is what I feel comfortable with, with not being house poor)
I am surprised of the price that the realtor gave because it's 25-30k and in some cases 50k below what the houses are appraising for in the neighborhood.
So depending on the updates needed... because I feel there are updates and then there are UPDATES. DH is in that business so I'm not too worried about painting, carpet, trim, replacing hardware, getting updated appliances, but if it's wood paneling and wall to wall tiling in the bathroom that is hot pink, etc then it may be too much for me to handle.
The friends sold their previous home to a friend so they are familiar with the process of not going through a realtor.
Everyone seems motivated, so if it's something that we like and are interested in, it could be a very good house for us. Meets all of our criteria as in the bones- 4 bedrooms, 2 1/2 baths, 2 car garage, large backyard, etc.
We have a realtor coming in on Sunday to look at our house and tell us what she thinks we can get for it. Same one we used when we bought the house. We put some sweat equity into the house this past weekend and updated some things that will help the house sell.
I have done this both on the
I have done this both on the buying and selling side multiple times. Generally, your lender will have requirements that will end up protecting you. A good home inspection and possibly adding a home warranty can put your mind at ease.
The problem with FSBO's is that you are taking a chance that the seller has a less than realistic price on their home. It may not just be that they are trying to save the 6% in realtor fees. They may have spoken to a realtor who told them their home was not worth what they think it is. Homeowners can attach a lot of "value" that might not be there to the home.
That being said, if you do your research on comparable values and the lender has a required appraisal, you should be ok.
There are certain states that have some fairly complex disclosures when selling a home, but hopefully your closing atty will be able to ensure those have been made.
Be on the lookout for things that may be deal breakers like homeowner additions that may not be county inspected.
Maybe a dumb question- but I
Maybe a dumb question- but I would be the one to hire a real estate lawyer to protect my interests, correct?
Depending upon your state,
Depending upon your state, you will need to have someone who "closes" the loan process. In my state, it has to be an actual attorney, but in some places a title company may be able to do it.
When you speak with your lender, you can ask them what may be required. You can also see if they can find a realtor who would be willing to handle just the paperwork portion of the deal.
We did a FSBO once and had a realtor who handled the offer/acceptance/disclosure paperwork for a thousand dollars. (paid by us the seller). We didn't need her to help us sell the place, but wanted the assurance that everything was done properly on that end. Maybe see if the sellers could do that? They already have a realtor they had in, maybe they could suggest it. I am not sure of anyone that would turn down the chance to earn a little when the alternative is zero..lol.
Your lender is also going to require certain inspections. They will likely do a home inspection/appraisal. If you are in a rural area they may also have a well/septic inspection. Also a pest inspection for termites is likely to be ordered.
See if the sellers are willing to add a home warranty as well.
If the home is thought to be below the local area pricing, it probably does need updates and potentially has some defects. Big ticket items would be your roof, plumbing, electric, foundation, HVAC and well/septic.
Cosmetically big ticket items would be kitchen and baths in need of huge updates.
Don't despair though. We bought a home for under 60K and got it appraised for 170K after we did some updates that amounted to cosmetic paint, flooring and a bit of drywall work. So much can be done as you go. If it's livable now, updates can be done as you afford them.
You may want to do that, but
You may want to do that, but when my daughter sold her house FSBO, the title/closing agent was the one who made sure everything was kosher.
Where we are the closing
Where we are the closing agents are lawyers... We have used the ones in a title insurance company, but also had a private atty who did nothing but real estate law work on a few deals.
Yeah I'm not sure if I need a
Yeah I'm not sure if I need a lawyer of if the title company handles it all? I am getting ready to send an email to the mortgage lender who did my last house loan.
FSBO isn't really any
FSBO isn't really any different for the buyer. Escrow will act as the middle man, just like when there are agents involved. Your escrow instructions will act as your purchase contract. The loan, and everything pertaining to it is exactly the same as if there were realtors involved.
I have been doing mortgages for 20 years, FSBO's have never been an issue.
They don't care who is
They don't care who is selling the home really. The main concern is that the buyer is qualified and that the home appraises for the proper amount to warrant lending.
The only issues I have seen with FSBO's is when the buyer agrees to pay a price to a seller that is more than the lender is willing to lend. Then, either the buyer and seller need to negotiate a new price...or buyer can bring more money to closing.
--The only issues I have seen
--The only issues I have seen with FSBO's is when the buyer agrees to pay a price to a seller that is more than the lender is willing to lend. Then, either the buyer and seller need to negotiate a new price...or buyer can bring more money to closing.
This happens with Realtors too. That's why people should call me to get pre-qualified before the go house hunting with their Realtor
Oh.. yeah.. of course! In
Oh.. yeah.. of course! In fact a FSBO seller should insist on a pre-qualification from the buyer to insist that they are qualified to borrow enough.
I think my parents had like 3-4 contracts on their home once because the buyers kept flaking.
But it is also not uncommon for the home to not appraise for enough because the buyer and seller agreed on a higher price than the property is worth. In those cases, they will need to compromise if they want the deal to go through.
We sold my DH property by
We sold my DH property by owner and we used a lawyer that specialized in real estate and he also owned a title company. They handled everything and only cost us like $500. The buyer was paying in cash too, so the bank wasn't involved either. Just us, the lawyer and buyer.
I just listed my rental property with a realtor though because we can't afford for it to be empty very long and I don't have the time or energy to dedicate to trying to sell it myself.
Yes I prefer it this way
Yes I prefer it this way cause there's no extra commission for the realtor in it, thus cheaper.
You and Seller agrees on price, then try and agree on what attorney to use, if you both use the same one it's way cheaper.... this is for the contracts and the deed transfer, we have attorneys that only deals with this and not sure how your realtors work, but I think they also use attorney's, they are just the middle man taking money
My family was looking for a
My family was looking for a house and thus we decided to hire a realtor as we were doing this for the very first time, therefore the home buying process was a bit confusing. We researched many realtors like from century 21 real estate agency NJ ( http://century21cedarcrest.com/ ) and many others. Finally, we have found our dream house in our budget.