Most home sellers work with a real estate agent to get their home moved quickly. They trust the agent’s knowledge and expertise.

However, it’s not uncommon these days to see properties listed for sale by the owner of the property.

Your first thought may be that you don’t want to try to buy a home from someone who doesn’t have proper representation, but In most cases, the transaction can be accomplished much the same.

In fact, it could be an advantage if you’re represented and the seller is not. In these cases, the seller is likely saving money by not paying a real estate agent, and may also have less interested buyers that may have the same first thought as you.

Buying a for sale by owner home isn’t difficult. You just have to be prepared and be reasonable with your expectations.

Here are a few tips that can help make these sales go smoothly:

Make an initial offer that’s below list price.

If you’re ready to make an offer on a home that’s listed for sale by owner, you can either have a lawyer draft a purchase contract, you can work with a real estate agent, or you can do this on your own. In the contract, your initial offer should be below the listed sale price.

This can make negotiations a lot easier. It can also determine whether or not the initial list price was reasonable, to begin with.

Check price listings for other similar properties in the area before making your offer, and be willing to negotiate within a reasonable limit.

Add any relevant contingencies to the contract.

Another important step is to make sure that any relevant contingencies are included in the purchase contract.

Contingencies are a way of making sure that you’re not liable in case something goes wrong.

Some common contingency clauses include a successful home inspection, approval of the loan, a proper home appraisal, that the home can be adequately insured, approving any disclosures that the seller may have and ensuring that the seller has clean title to the home.

If any of these or other necessary conditions are not met, the contract can be considered null and void as long as these contingencies were included in the contract.

Figure out what fees are paid for by each party.

Fees are often negotiable, but it’s a good idea to have who pays for which fees in writing.

Deciding which party is responsible for title fees, transfer fees, the escrow, and other associated costs now can save you a lot of headaches later.

You may be able to negotiate this all by yourself, or you can enroll the assistance of a lawyer for this task.

Determine who is responsible for any problems found by the home inspector.

After the home is inspected by a qualified home inspector, they will generally leave a list of concerns or problems that need attention.

You should sit down with the home seller to determine which party is responsible.

The home seller could take responsibility for all repairs and upgrades, or you could opt to take on these tasks yourself.

If so, consider asking the seller to either reduce the sale price of the home or credit you for these additional costs at the time of closing.

This credit should go towards reducing your closing costs.

However, if the home is being sold in “as is” condition, there’s probably not much that you can ask the seller to do in these situations.

Consider any prorations.

Another thing to think about is whether or not there will be any pro-rated taxes or fees involved in the sale.

If the property taxes were paid by the seller or unused, that portion will usually go back to the seller.

However, if the seller was behind or late in paying their property taxes, you can ask for prorations on that portion so that you can be properly credited.

money to buy a home

Decide when you’ll take ownership of the home.

One of the last things to determine is when you’ll actually take possession of the home. Sometimes you can move in right away. Other times, there may be delays by either party.

The home buyer may need some extra time to relocate and buy furniture, for example.

Other times, the seller may be waiting on an offer on another home they are buying to go through before your transaction with them can be completed. Whatever the situation may be, be sure to get that information in writing.


In Conclusion

Those are the main things to keep in mind when you’re thinking about buying a property that is put up for sale by the owner instead of by a real estate agent.

Contrary to public opinion, most private sellers are serious about selling their home. They may also be willing to negotiate on price and other terms. Sometimes all you have to do is ask.

People who sell their homes directly are bound to the same laws and rules that any real estate agent is.

They are required to present all material facts and can face some serious legal and financial consequences for omitting any pertinent information that is relevant to the sale.

Another advantage of buying a home that’s listed for sale by the owner is that you may not need to be pre-approved for a mortgage for the seller to consider your offer. It doesn’t hurt to talk to your bank, credit union or other financial institution, though.

You can still get pre-approved for a mortgage if it will help you with the sales process. It can work in your favor because the seller knows that you’re already pre-approved and are taking the process seriously.

Buying a home directly from the seller can be a little more difficult than going through the usual channels. Be especially careful if the home is sold as-is. If you have any doubt or concerns, don’t hesitate to ask questions.

Most individuals who are selling their home by themselves are inexperienced. They don’t have the sales and marketing knowledge and expertise that a professional realtor has.

However, if you’re willing to do the legwork in terms of scheduling the walk-through and inspection and being proactive with the paperwork, you just might land a great deal.

You may end up walking away with a piece of property that’s far better than you ever imagined.

Contact The Norber Real Estate Group

The best source of information about local communities and real estate topics is your real estate agent. Give Joshua Norber of the Norber Real Estate Group a call today at 248-785-3737 to learn more about the area, discuss selling your house, or tour available homes for sale.

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