25 May Why buying a FSBO unrepresented by a Realtor is a bad idea
There are many articles about why listing a home FSBO (for sale by owner) is a bad idea – honestly I am more concerned with the buyer who goes in unrepresented
Many times both parties do not know the the full process. If you have not sold or bought a home in the last 2 years, so much has changed you really are a first time home buyer/seller when it comes to knowing the process.
In this limited marketed you are looking everywhere to find a home, so your not leaving a stone unturned. Thinking okay I found a FSBO and this is going to save me money …..but will it? Let’s look at the ways it could cost you more money
Let’s say they are selling for “fair market value” selling the home for what like homes sell for listed with a Realtor – do you think its fair market value when a commission comes out of the neighbors home and not the FSBO home? I wonder – should this be taken in consideration when purchasing a FSBO? So is it really fair market value? So this did not save you money.
Although, when listing the home did they take into consideration the homes in the neighborhoods condition VS thiers – very important to the appraisal process, so after your inspections the home may not appraise – so now you just paid for inspection and an appraisal and can not get the loan – this certainly did not save you money – and if you do not have the proper purchase agreement you could lose your earnest money – oh and BTW – who is holding that earnest check ? The ower? – well good luck!
When purchasing a home with a Realtor there are steps that are taken to protect both parties, how do you know this is the case when purchasing a FSBO?
The selling of the home as a FSBO just became personal – how do you think you will feel after inspections that you have to the tell the seller to their face what is wrong with their home and you want them to fix it, or pay for it, or reduce price to make up for it – this situation can become very uncomfortable either leading to a deal falling apart or buyer not addressing the real issues and getting stuck with the mess. Or just plain hard feelings. Having a Realtor professional can make this process much easier and less painful.
Did you get proper disclosures – yes the seller, when listed with a Realtor must provide a sellers disclosure. Did you know with the West Michigan purchase agreement not ALL inspections are up to the buyer some are provided by seller.
The purchase agreement – did you now the West Michigan purchase agreement of 6 pages long – if yours is not – what are you missing – it could be something very essential.
Do you have an exit clause or contingencies that will protect you and your earnest money?
There are so many other things that can go wrong that will end up costing the buyer money, stress, time and heartache – if the seller does not want to work with a Realtor it makes me wonder why – what are they scared of – what do they want to keep covered up? Is it just about the money or is it more than that?
I have heard so many horror stories – I worry for the buyer. Do you still want to help the seller save money – because it’s going to probably cost you a lot of money to help them!