Buying from a FSBO question

[A930Rocket]

Anybody buy a lot or house from a For Sale By Owner (FSBO)?

We are looking at a lot and want to know what steps we should take: who pays the closing costs, title search, survey, etc.

Thanks!

[icemann427]

I'm guessing you can find a boiler plate purchase and sale agreement, online. Perchance, you have a friend who is a Realtor, maybe they will give you their standard purchase and sale agreement you can follow without requiring representation and paying a commission. In many states, all of this plus the escrow transaction is handled by attorneys. In many other states, an escrow company can take care of the purchase and sales transaction.

Who pays for what is what ever is agreed to. However, there are standard or normal charges borne by buyer and seller. Buyer and seller normally split the escrow fees. Owner's title insurance is paid by the seller which insures for what you are paying, is what you are getting. If you are getting a loan on the property, you as the buyer/borrower will pay the Lender's title insurance policy. The property almost certainly had a survey sometime in the past, which may be a metes and bounds legal description. Based upon being able to read the legal description, you may be able to find the lot corners. If not, paying for a surveyor to find them, anew, should be paid for by the seller. Real estate taxes should be prorated based upon the closing date and could be charged to seller and credited to you based upon the closing date. All other assessments should be current, but if not, should be paid by the seller. Once you enter escrow, you should receive a preliminary title report that gives the legal description; a pdf picture of the property which includes the measurements; all the exceptions to title that could possibly matter to you as the buyer (easements, HOA's, assessments, etc); real estate tax information and whether or not they are current. You need to know what you are reading on the preliminary title report to make sure everything is proper. If you do not, I would be happy to read it for you. Recording charges for the deed; messenger service and a bunch of other junk type fees which somehow are added in can be negotiated by buyer and seller but perhaps ask the escrow officer who normally pays for these silly items. That's about all I can think of at the moment. If I remember more, later, I will post, again.

[smadsen]

You can do a FSBO (fizz-bow) easily, but hiring a technically competent escrow company to handle the transaction is money well spent unless you are an attorney or have access to one. To paraphrase and quote, I think Dick Cheney, "You don't know what you don't know."

[A930Rocket]

Thanks, iceman. That’s great information.

[A930Rocket]

Originally Posted by smadsen

You can do a FSBO (fizz-bow) easily, but hiring a technically competent escrow company to handle the transaction is money well spent unless you are an attorney or have access to one. To paraphrase and quote, I think Dick Cheney, "You don't know what you don't know."

We’ll definitely have a lawyer help us with the process.

[look 171]

I bought three homes from owners. The laws varies from state to state.

I called my escrow company to provide me a form from the state. All residential sales uses this form. Its very easy and simple to fill out. AFter both parties signs, I submit to escrow office and they take care of everything from there.

Iceman is absolutely correct.

We split the cost of escrow.
I pay for the title report on tow of those houses. The other belonged to my neighbor and I saved a few bucks on the title report only because he don't owe anything or in any debt and no liens.

[look 171]

Get it inspected unless there's major remodel takes place after purchase.

[daepp]

Bought my first house from FSBO IN ‘88. Seller inherited it, so I got him to finance it as well.

[john70t]

It can be done face-to-face using a title company to finalize the docs at a minimum.

In the grand scheme of things, you are paying several hundred grand or much more for your "home" which may swing greatly in value due to so many other conditions.
It may be the biggest investment of many people's lives, worth a decade of pure work income.
Condition and neighborhood/city/state is so much more important.

Arguing over a few hundred or a few thousand and making both parties completely upset at the end or possibly losing the sale might be a drop in the bucket overall.

[Porsche-O-Phile]

I’ve sold (but not purchased) two houses as FSBO. Both were very easy. I hired an attorney for a fraction of what an agent would’ve cost to review things and make sure stuff went ahead smoothly. Very easy. Buyer always paid closing costs.

Glad I got out when I did. Yea prices are still going up but I wonder for how long. Pain in the butt to hold property that I’m not living in and I had zero interest in being an absentee landlord. Best choice for me.

I see VERY little downside to FSBO.

[Seahawk]

We just sold my MILs house.

We used a local RE agent that took care of everything for 1%. The house was empty and she took care of the one showing

We had a few inspection issues but otherwise seamless.

The buyer used a local lawyer that does pretty much nothing else but real estate closings. Everything is negotiable!

[GH85Carrera]

When I sold my parents house I stuck a FSBO sign in the front yard. We had an estate sale, and emptied the place of lots of "stuff" and I was paying to have it mowed.

I got a solid nibble and I paid a real estate friend a flat fee, $1,000 to handle the contracts and he met us at the closing office. He did not have to do anything but the paperwork that is "sign here" a few dozen times. It is silly how many signatures it takes to buy or sell a house.

[911_Dude]

Ive sold several homes as FSBO. Its in the buyers interest to produce the contract. But they never do. So I would have one available. As the buyer, once you have a bank lined up, they will pretty much handle all the details, escrow, title search, etc. It is in their interest to do so. If your buying in cash it will be up to you. But all you have to do is hire a title company. All inspections are on the buyers dime. I know real estate agents that will handle it for a flat fee. Should be no more that a few hundred bucks because its so easy. Dont pay more than that.

So, find house, get bank loan, get a signed contract, take contract to bank, they do most of the rest. Fees and charges will be pretty much standard for your area. But are negotiable. Its easy.

[A930Rocket]

i made a broad statement with the lot or house question. In this case, it's only a lot, one a few left in an established neighborhood (and down the street from where we just sold our house), so it will be an easier transaction.

The bank will take care of the appraisal, but i need to talk to them about title insurance, etc.

i have a call into our real estate attorney.