Many homeowners believe that selling a home themselves (without an agent) is a great opportunity to save money when it is time to move into a new space, which may often be true. However, there are several things to be aware of when purchasing or selling a home without the assistance of an agent.
Since the seller now takes on the majority of responsibilities that would have otherwise fallen to the agent, it may leave them vulnerable to costly mistakes that could delay the sale to the buyer, or leave them exposed to liabilities. In this article, learn more about ‘for sale by owners’ liabilities and what you should keep in mind throughout these transactions.
For Sale by Owner Situations
In a for sale by owner, or FSBO, situation, the home is being sold without the help of a listing agent. This allows the owner to save money in exchange for handling all aspects of the sale of the property. They must conduct research to price the home properly, handle all marketing and house tours, and work with buyers’ agents to sell the home.
This process also includes compiling and sometimes drafting paperwork to complete the sale. In some cases, the buyer’s agent will draft the purchase agreement and other necessary contracts, but other times the responsibility may fall on the seller. No matter who drafts the contract, it is important to review it carefully before signing to ensure that no mistakes are made.
Contract Review Process
After receiving a purchasing agreement, both the buyer and seller should review it and ensure that all information is correct. The contract should clearly identify the address of the property and the parties involved in the sale, the prices and terms of the sale, the closing date and costs, an expiration date for the contract, and other important information about the home. Sellers must disclose information that may impact the property’s safety or value, such as wells, lead paint, and termite damage, in the contract. If this information is not disclosed, they could be liable for serious legal ramifications.
The purchase agreement can also be made on the condition of successful inspections, appraisals, financing, and title searches, among other contingencies. These elements can be included at the discretion of the buyer or seller prior to submitting the contract, though they will typically be discussed in advance as well. Either party can cancel the agreement outside of these contingencies only if certain conditions are met, such as the late submission of signed disclosure forms or denial of access for inspection.
After receiving the contract, you will need to carefully review it to ensure that all information included is accurate and that nothing crucial has been omitted. If you are the seller, it also helps to put together a counter offer at this time, if desired. The counter offer can change the price of the property, refuse to adopt certain contingencies or cover closing costs, change the timeframe for addressing contingencies, and exclude personal property from the agreement, for example. The buyer can then accept, reject, or make a counter offer of their own.
Assistance From A Title Agent
In many cases, the buyer’s agent assisting with the contract review process is also the title agent. Your title agent can help you draft a contract, negotiate a counter offer, and review contracts before signing to ensure that they are complete and accurate. Like real estate agents, title agents are deeply familiar with the laws surrounding the sale of a home and will be able to identify any concerns with the proposed contract or amend it as necessary to ensure that both parties are satisfied with its terms. Working with an experienced title agent ensures that your sale will be completed in a way that meets your needs and protects you from legal concerns in the future.
Working with a Title Company
Whether you are the buyer or the seller in a FSBO situation, be sure to pay close attention to the legal details of the transaction to ensure it is finished as smoothly and easily as possible. To this end, it may be beneficial to work with a title agent like Robin Mathis at Mathis Title Company. Thanks to her years of experience in both the legal and real estate industries, Mathis can provide her clients with uniquely in-depth guidance that gives them peace of mind throughout the transaction.
She ensures each client receives personalized attention and offers contract review and preparation, title insurance, lien, and refinancing negotiation services. Contact Mathis Title Company today for more information about contract review and the home buying or selling process.