Why buy a FSBO property and why use ColumbiaGorgeFSBO.com?
This website is a marketing service which provides one central location to search for FSBO properties offered by owners who are not using a real estate agent. Pictures and details are abundant so your home search can be narrowed significantly, even before you begin your tour of potential properties. Don’t search for property on someone else’s schedule (the real estate agent’s schedule) – this site allows you to search on your schedule.
One of the most important reasons to look for a FSBO property is to avoid a real estate agent’s commission. If a seller doesn’t have to pay a lofty commission, many are more eager to negotiate on price and may price their property more reasonably initially.
You can cut out the middle man and deal directly with the seller. Negotiate directly with the seller, which could save time and can get the sale moving much more quickly.
Are you considering purchasing a FSBO property?
Here are some general items to be aware of:
- First, do not sign a Buyer’s Agreement with a real estate agent unless you are willing to pay that agent a commission. The primary reason to buy directly from an owner is to avoid a commission, thereby giving the owner extra motivation to negotiate on the price. Some sellers may note on their property’s page and/or flyer that they will pay an agent commission.
- Know the area where you want to buy. Follow this link to find local resources on everything from schools to activities.
- Determine your price range. Most mortgage lenders will pre-approve you, meaning they will approve you up to a certain mortgage amount. Or they may pre-qualify you for a home loan, meaning they have given you an estimate based on an income-to-debt ratio. Of course, either is contingent on your credit history and current financial situation at the time of the loan approval process. It’s important to be pre-approved and/or qualified to show a seller that he can take your offer seriously. Sellers typically prefer pre-approved versus pre-qualified as it is a stronger indication of the buyer’s ability to close the transaction.
- Find your home. This website is an easily accessible, 24 hours per day, 7 days a week, 365 days per year, centralized location to see available FSBO properties in the Columbia Gorge region. Our individual property pages are so detailed that you can greatly narrow your search, leaving fewer homes to actually tour, saving your time.
- Make an offer. You need to make an offer to the seller to start the buying process. The initial offer should be a high enough price so the seller will take you seriously, but low enough that you get the best possible deal. There are many factors to consider when making an offer, such as how long the property has been on the market, selling price of comparable properties and how much interest there is in the property. You should make your offer in writing, on industry standard forms for the locale. Your local title company is often willing to provide the proper forms, either free or at a reasonable cost. Sellers will want earnest money as part of any serious offer. Earnest money is typically credited to the buyer’s purchase price at the time of closing.
- Do the paperwork. You’ll need a Purchase and Sale Agreement between you, the buyer, and the seller. This will state the purchase price, as well as any other conditions or contingencies. You’ll also determine dates to accomplish what must be completed before the sale closes. The earnest money amount should be negotiated between the buyer and seller. You should know that general Purchase and Sale Agreements don’t necessarily include the protections for buyers and sellers that many attorneys may suggest. Your closing date, and the length of escrow, will typically be from 30 to 90 days, based on the time both parties agree upon to accomplish steps like inspections, loan approval (unless a cash transaction) and resolution of contingencies.
- NEED FORMS? Click here to find Real Estate Forms for your transaction. We have seleceted USLegalForms.com to provide you easy access to state specific real estate forms at a reasonable cost.
- Open an escrow account at a Title Company. You’ll need to choose the title company that you’ll be using to close your sale. It is generally in the area where the house being purchased is located. Once your Purchase and Sale Agreement is signed by both parties and the seller has the earnest money in hand, take both to the title company.
- Take your Agreement to your lender. They will process your completed loan application. Being pre-qualified or pre-approved doesn’t necessarily guarantee your loan approval and a formal application process is required if this is not a cash purchase.
- Schedule your inspections and appraisal. Your mortgage company will require both and the buyer is typically responsible for inspection and appraisal costs. An inspection may reveal any problems with the home, the resolution of which will need to be negotiated with the seller. Some problems may invalidate your Agreement or interrupt the loan application process until a solution is reached.
- Stay in close contact with your lender and the Title Company. Additional paperwork, information or funds may be needed by either and could postpone the closing date if not received quickly enough. Sometimes missing information or dates can even invalidate the contract. Be sure to adhere to all deadlines in the Purchase and sale agreement in order to be in compliance and prevent the agreement from being invalidated.
- Close the deal. Know the laws in your state regarding closing requirements. Your Title Company can guide you in this regard, although they will not provide legal guidance to you.
Please note, the above information is general in nature and does not address your specific situation. Consulting a real estate attorney or other professional may be prudent if you are unsure of the sales process.