Danger Zone: For Sale By Owner

NEW as of 1/17/06

Danger Zone: For Sale By Owner (FSBO) - limit your risks! by Albert Unger, Esq.
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This is an article in progress.

Installment one:

If you have never bought or sold a home before.....how do you go about getting the information to do it yourself? There are many books and other resources for self help but they are very problematic. Here are my top ten reasons why you may want to consider a real estate team including an agent and an attorney:

10. Agents & Attorneys have helped hundreds, and sometimes thousands of buyers and sellers. Has the do it yourself author/publisher have that experience, and do they have that experience in light of Connecticut law and in light of practices that vary from county to county (sometimes even town to town)??

9. Do it yourself real estate and legal information is often generic. It may not take into account law that applies in Connecticut, and it may not be updated in a timely fashion for changes in the law. (See my future article on how off the shelf software can cost home improvement contractors big bucks!)

8. Since you do not buy and sell homes yourself every day, and since you DO have an emotional attachment to your home, how do you know you won't say the wrong thing or reveal information that you are not obligated to reveal?

7. Do you know anything about the reputation about the mortgage company or the individual agent if you are not relying on professionals.

6. Do you really want to have hold your own open house and watch people scrutinize (and sometimes mock) your home? Do you have all of the many hours it takes to hold open houses and to be available any time someone wants to see your home? If you are a buyer do you want to go to open houses without a decent preliminary idea about whether or not the home may be right for you. (Agents know how to help you determine what you REALLY need, and if the have not seen a home they can spend THEIR TIME to preview it to see if it is right for you so that you do not waste YOUR valuable time).

5. Sellers: Do you know that buyer's often take advantage of your situation by taking 5% off your price in their mind? Did you realize that most of the time there is a much higher chance of multiple offers and a bidding war for your home if you are on the MLS and have an agent working your listing? So..... what are (would) you really save by not using a real estate agent.

4. Buyers: Will you read the property disclosure report (if you even get one) if there is no agent or attorney advising you on the deal? Do you know what to look for if the seller tells you they have never had an oil tank, never had a basement leak, and never had termites?

3. Legal alert: Do you really know what your rights are in regards to deposits? The law is not always cut & dry in this area and the outcome may vary from state to state. If you give a deposit (or hold one)...is that money in an escrow account and is a trustworthy third party in charge of that money?

2. Do you subscribe to the philosophy that penny wise often less than a wise outcome? Are you enough of a risk taker to take big gambles with the largest investment of your life?

1. If you are a buyer how do you know for sure that the seller will use your funds to payoff their mortgage so that it does not affect your ownership of the property? If you are a seller how do you know that the pre approval, mortgage commitment, deposit money, and closing funds are any good? Do you know the difference between a pre qualification, pre approval, and a commitment? (In a rare occasion the mortgage broker does not explain to you how big of a difference there is)