If you've had your home on the market for a bit with a realtor with no luck whatsoever you may be thinking of selling your home as a FSBO (For Sale By Owner). With market values down in many areas, it's possible that selling your home as a “do-it-yourself” project may be just what you need to make sure you keep as much revenue from the sale as possible, however it's also important that you do your due diligence to eliminate or reduce complications when closing on the sale.
Individuals who are unfamiliar with the process may be a bit nervous about selling without a realtor, however there is a wealth of knowledge available on reputable sites such as Zillow.com, Realtor.com, Trulia and AltosResearch to help you familiarize yourself with the steps you need to take to sell your home yourself.
Not only will you find information about the procedures for selling your home, you can also look up the property values of homes similar to yours (and even ones in your neighborhood if any are for sale) to help you set a competitive price.
Of course you will need to take into account the amount of your existing mortgage(s) including any possible prepayment penalties which might be applicable, outstanding liens, including taxes, making sure you've allowed enough money to pay off these debts and still walk away with a bit of cash for yourself.
It's important to note that just because you're not paying realtor fees, in many states the seller is responsible for paying the buyer's agent fee, so you need to know all of this information up front before accepting any bids on your property.
Once you know how much money you need to pay off your debts and walk away owing nothing, and hopefully having something left, you can set your sales price. Are you in a rush to sell? Don't let on to the buyer or his agent – otherwise you will likely be pressured to go lower than you would prefer. Also, keep your price realistic when compared to homes like yours in the area – you don't want to sit by while everyone around you has sold theirs and moved. If you prefer, it also doesn't hurt to spend the money and have a professional appraiser evaluate your home's value. This is a helpful tool to use when negotiating with prospective buyers.
Make sure your home is in tip-top shape (unless you're selling as a renovation) beautifying both the interior and exterior. We get used to how our homes look day in and day out, so sometimes it's helpful to have someone who isn't there all of the time view your home's condition with a critical eye. There may be minor flaws that are easily fixed which your realtor may not have pointed out that you simply never notice. It's also helpful to get ideas about furniture arranging and décor that would boost your home's aesthetic appeal.
Find out who the buyer has chosen to handle the closing. Obtain a copy of a preliminary closing or settlement statement from the closer as soon as possible. Work with her to help speed things along by promptly giving her documentation that she might need.
Ask for a copy of the closing papers (which won't be much since you're the seller) to review ahead of time if possible. Review them closely looking for any errors, especially in the payoff figures. Make certain that all of the existing liens on the property are accounted for on the HUD-1 settlement statement. Ask questions – this is your money, after all.
NOTE: To obtain the most up to date information on the amount of your lien(s), contact your lienholder(s) for a payoff amount, which should be good through a specified date.
While selling a home as a FSBO is not for everyone, some people enjoy doing it themselves. If you do choose to sell your house as a For Sale By Owner, be prepared to do a lot of footwork (i.e. phone calls, tracking down information, etc.) yourself. Sometimes, however, it's a small price to pay for the money it can save.