Quick Help: FSBO - any experience?

[vettechick99]

FI and I are moving 2.5 hours out of ATL to his old hometown in Central GA. When we were there this weekend, we saw a FSBO and peeked in the windows. Looked cute and today we are going to get a look inside.

Now if the house turns out as well as we think it will, we want to have it inspected and make an offer. We've already been approved for a loan up the asking price by a lender in ATL. But this is my first FSBO and I'm not really sure the protocol.

Any experience from either end? TIA! We leave in 30 minutes!

 

[chrissyk]

I just sold our house FSBO. What do you want to know specifically?

The way that it went was that the wife saw the house in the morning, then brought her DH back in the evening. The next day, they came over and made an offer. We negotiated a bit, then told them we'd think about it. 10 minutes later, DH called them back and we settled on a number. We had our attorney draw up the offer and P+S, and he handled all the escrows. It was an easy transaction. Let me know if there is anything else you want to know.

We're still friends with all of our old neighbors, so our buyers let us come back in the house to show us what they'd done with the place (they put hardwood in the bedrooms). It looks SO good! I feel so good knowing that the house went to people who so wanted to be in the neighborhood and who love the house

 

[chrissyk]

One other thing...if you've signed ANYTHING with any realtor for any reason, please disclose this to the sellers. We were absolutely not going to deal with giving any realtor a cut of the transaction, so we refused to even show the house to people who had signed anything with a realtor. The sellers have a right to know that.

Edit: Also, we were present for the inspection, and we had to send in the radon canisters ourselves. We also did the final walkthrough ourselves with the buyers. I think that that was the best part of the transaction. When the wife walked in and said "it's SO beautiful," I knew that we'd sold to the right family. They love their new neighborhood already, which is great since I loved it too

 

[vettechick99]

Well I remember when I bought my other house that we gave a good faith deposit and signed some form. I also remember the RE agent taking care of everything and being super helpful.

I guess I'm just wondering what the process is. Do we still give a GF deposit? Will a real estate atty help me with forms? Does it matter that my lender and most likely atty will be in ATL and the seller in the other town?

Thanks!

 

[vettechick99]

Originally posted by chrissyk
One other thing...if you've signed ANYTHING with any realtor for any reason, please disclose this to the sellers. We were absolutely not going to deal with giving any realtor a cut of the transaction, so we refused to even show the house to people who had signed anything with a realtor. The sellers have a right to know that.

No realtors are involved at all.

We don't need to be there for the inspection, right?

 

[chrissyk]

Originally posted by vettechick99
Well I remember when I bought my other house that we gave a good faith deposit and signed some form. I also remember the RE agent taking care of everything and being super helpful.

I guess I'm just wondering what the process is. Do we still give a GF deposit? Will a real estate atty help me with forms? Does it matter that my lender and most likely atty will be in ATL and the seller in the other town?

Thanks!

Our attorney and the buyer's attorney were in 2 different towns. It didn't matter a bit

You will give the GF deposit to the seller's attorney when you send in the signed offer letter. We asked for $1000 GF deposit, and then our attorney collected 10% earnest $$ when they signed the P+S. We had a bit of trouble getting them to get their mortgage commitment letter on time, but otherwise everything went fine.

Also, do you have a contingency? If so, you need to disclose this up-front as well.

 

[chrissyk]

Originally posted by vettechick99
No realtors are involved at all.

We don't need to be there for the inspection, right?

You are paying the inspector. Why wouldn't you WANT to be there? I'd say that you do need to be there for the inspection, but that's JMHO. I can't imagine paying $300 for an inspection and then not going to it. Inspections are for the buyer's benefit. They are not required I don't think. You don't need to be there for the APPRAISAL, though. Maybe that's what you are thinking of?

 

[vettechick99]

Originally posted by chrissyk


Also, do you have a contingency? If so, you need to disclose this up-front as well.

Contingency?

I guess I'm confused about at what point do we make an offer. Do you make and offer and then have the inspector look at it? Or can you have them look and then make an offer based on what problems they find.

 

[chrissyk]

Originally posted by vettechick99
Contingency?

I guess I'm confused about at what point do we make an offer. Do you make and offer and then have the inspector look at it? Or can you have them look and then make an offer based on what problems they find.

Contingency=Do you have a house to sell?

You make the offer first. You settle on a price, and the signed offer letter typically gives you 10 days to have an inspection. If you find problems with the house that you can't agree with the seller about fixing, then you stop there and you don't sign the P+S.

 

[vettechick99]

No house to sell.

OK, that sounds good. Thanks for all your help.

 

[chrissyk]

Originally posted by vettechick99
No house to sell.

OK, that sounds good. Thanks for all your help.

You are a primo buyer...no realtor, no house to sell. Use it to your advantage in the negotiations Good luck!

 

[Lisa F]

What is typical really varies by location, too. Around here, NOTHING is signed until the house has been inspected and that contingency is cleared. When we sold our house in TX, they had standard forms to use so attorney involvement was not required or customary. IMO the most important thing you can do is get an attorney who is familiar with the customs of the area in which you are looking to buy to guide you through the process.

You most certainly should be there for inspection and generally after the inspection there is a chance to renegotiate based on what you have found. You should not view the inspection as a chance to nickel and dime the seller and give them a laundry list of things to fix so that you have a perfect home. I think many buyers make the mistake of thinking that every little thing that shows up on the inspection needs to be addressed by the sellers. What you should use it for is to make sure that your offer is fair based on the condition of the house... did you make an offer based on the understanding that the roof is in great shape when in reality it needs to be replaced very soon? Are there signs of water damage? Mold? Termites? Basically you should be looking for deal breakers or things that affect the value of the house.

On the other hand, a decent inspector WILL give you a laundry list of things that should be addressed. You should view this as an opportunity to have a pro come look at the house and tell you what things you should take care of and how to avoid later maintenence issues (for example, our inspector pointed out where a missing downspout was causing water to hit the side of the house rather than run away from it. It's a simple fix and no big deal and certainly for the $30 part it was not going to be a deal breaker... we'd rather make the repair ourselves so we know what we are getting). On the other hand, we have a slate roof and if there had been significant damage to it, it would have created problems for how much we were offering on the house since repairs can be costly.

The best thing you can do for yourself is to have professional people who know what they are doing looking out for your interests.

 

[mickeyfan1]

Your offer should be contingent on a satisfactory inspection done by a pro. You don't have to be there for the inspection, but it is always nice to know exactly what, where, and why things that are in the report are there. If you make your offer with out stating there must be satisfactory inspection, then you are committing to buying even if the inspector finds serious problems. As the sellers are not using a realtor, you should get the comps for the area. Their listing price should be lower than the comps as they aren't paying the 7% commish on the sale. Your offer should be in the range of the comps less the commish.

 

[chrissyk]

Originally posted by mickeyfan1
As the sellers are not using a realtor, you should get the comps for the area. Their listing price should be lower than the comps as they aren't paying the 7% commish on the sale. Your offer should be in the range of the comps less the commish.

This really depends on the area. We got 9K MORE than the highest realtor appraisal of the house on our FSBO. In a lot of areas (MA included), people are doing FSBO at the same prices as realtor-listed houses, because the demand is that high.