Four Things You Should Know Before Buying A For Sale By Owner Home

Real Estate Blog

With many homes on the market, you may run into a few that are consider "For Sale by Owner." This means that the owner is not working with an agent to sell their home, but are instead looking to sell it on their own. While there are benefits to buying a home that is being sold by the owner, there are also downsides that you want to be wary of. Here are four things you should know about this:

  1. There May be Some Hidden Details: One of the reasons the owner might be selling without an agent is because there are details about the home that they do not want to disclose. When a seller works with an agent, these details must be disclosed by law, but this isn't the case when the home is being sold by the owner. These details include a murder that has taken place in the home, a previous fire or water damage that has occurred, or the home being used a meth lab. Be wary of this and work with a real estate agent who may be able to sway the seller to disclose this information. 
  2. You Might Pay Too Much: This is usually only the case if you are not working with a real estate agent either. Since the seller is not working with an agent, they aren't going to come up with a fair price for the home that is based on current listings. This could lead to a home that is priced way too high. Of course, if you are working with a real estate agent, they will be able to determine whether or not this is the case. 
  3. You Could Become Stuck With the Home: Since you are not dealing with the process of buying through an agent, but rather the owner, certain procedures could be overlooked that basically traps you into buying the home. For example, there might not be contingencies that release you from your obligation for buying the home if something falls through, which means you are stuck to continue the buying process. Plus, if you had the owner a deposit for the sale of the home and it's not placed in an escrow account, you won't get that money back if the sale falls through in this situation either. 
  4. You Might Pay More Closing Costs: An agent will ensure that you are aware of the closing costs, whereas the owner might not make these details clear. Of course, working with your own agent can help you avoid this confusion so that you know exactly what you are paying at closing. 

When you know these four things, you can be sure that the process of buying a home through an owner is much smoother. You can also see why it's still important to have your own real estate agent to ensure that you are completely avoiding all the downsides of buying a for sale by owner house. 

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2 October 2017

Investment Property Purchases: What You Should Know

Once I paid of the mortgage on my house, I decided I wanted to buy an investment property. I had no idea that the buying process would be different, but it really was. There were so many things to consider that I hadn't thought about, and even the loan application process was different. It occurred to me that if I didn't know about it, others likely didn't either. I built this site to help others see what I went through buying my first investment home. I hope that it helps you to approach the process with more confidence and understanding.