For Sale By Owner (FSBO)

For Sale By Owner (FSBO)

FOR SALE BY OWNER (FSBO) vs. Working With A Full Service Broker

As an alternative to using a Full Service Broker, homeowners who are highly knowledgeable in real estate transactions also have many options to sell their property through a wide range of For Sale By Owner (FSBO) Websites. They usually do not cross list in the local Realtor Multi-List Systems, but do have a range of cooperating websites that will display the listings.


The following is a link to the Top 50 FSBO sites in 2019, with ZILLO being one of the top contenders. Each site has different costs and services, and many do not provide you with any approved state forms to use for the sale contract, escrow funds, and property disclosure forms, so you may have to obtain those from office supply stores or on-line specialty forms websites. Also, in addition to unscreened calls from unqualified buyers, you can expect numerous calls from local real estate agents wanting to list your property in the MLS for the usual fees. As long as you understand this and can handle the wide range of calls, this might be of value to you. The link is shown HERE


Should you work with a Broker or a For Sale By Owner (FSBO) Site?

When dealing with a purchase or sale of real estate, buyers and sellers alike have three options:


(1) Dealing with a Member of the National Association of Realtors (NAR) who has full access to a nationwide and statewide Multi List System (MLS) networks, approved state forms & attorneys


(2) Dealing with a basic Real Estate Agent who is not a member of the NAR, and has NO access to the state-wide and nationwide MLS Networks, Legal Contracts and other Special Services


(3) Simply doing it yourself (provided you feel that you have the experience in handling the type of transactions you are involved with).


When working with a real estate agent who is a Realtor(c) the property is placed into a Multi-List System (MLS) by the Sellers Broker (called a Listing Agent) who is responsible for all the details of the Seller, and a Buyer is usually represented by a Buyers Agent, who is responsible for all the details of the Buyer. All of These duties can be performed by a Listing Agent, but about 80% of the time, another Agent will find the property for the Buyer and assist in the sale. The Seller pays the Listing Agent an agreed upon commission, and that agent in turn agrees to pay a portion of that same commission (usually around 50%, but this varies) to a Buyers Agent who bring in the purchaser.


So it costs the SELLER nothing extra to use the MLS, and it opens the marketing of the property to a vast number of other agents, buyers, and advertising sites, which will speed up the sale.


Likewise, it costs a Buyer nothing extra to use a Buyers Agent, since there are no additional commissions to pay – the Seller has already agreed to pay a single fee, which is shared by both agents.


Real Estate Agents who are members of the National Association of Realtors (NAR) (REALTOR®) have received advanced training in handling most types of real estate transactions, receive regular periodic updated training have a large staff of real estate attorneys available for consultation, have access to a nationwide network of Real Estate Multi-List Systems (MLS) where they can promote a Sellers property or search for specific types of property for a Buyer, and a complete set of Real Estate Forms written by real estate attorneys and approved for each state so that both Buyers and Sellers are handled fairly and equitably. Agents who are not Realtor(c) members of the NAR do not have these services or capabilities.


Buyers and Sellers who are educated and familiar with real estate transactions can certainly make offers and close deals on their own, but the Buyers usually have a difficult time locating the exact type of property they are looking for, and the Buyer and Seller alike do not have the same capability to place a proper market value on the property or comply with all of the complex new state laws concerning contracts, reports, and procedures. There are certainly several For Sale By OWNER (FSBO) sites available that can assist in some of the marketing and forms, and we would be glad to refer you one of these the top 10 FSBO Sites if you are interested, but Zillow is the number one choice for most sellers.


FULL SERVICE BROKERS provide a valuable service for sellers and buyers alike during the sale and purchase of a home. Listed below are nearly 200 typical actions, research steps, procedures, processes and review stages in a successful residential real estate transaction that a full service real estate brokerage LISTING AGENT handling the listing and sale of a property in return for their sales commission could possibly be called upon to handle for a seller.


Some are the services are duties an agent would do for a Buyer, and some are duties an agent would do for the Seller. In most cases the Seller has contracted with a Realtor© to handle the entire transaction for a single commission payable only if the property is actually sold.


Whenever another cooperating agent brings a Buyer who closes a sale, the Listing Agent pays a portion of the commission (usually about 50%) to the Buyers Agent (there are no additional add on fees for a Buyer to use their own agent). Depending on the transaction, some may take hours, or even days to complete, while some may not be needed at all. More importantly, they reflect the level of skill, knowledge and attention to detail required in today’s real estate transaction, underscoring the importance of having help and guidance from someone who fully understands the process – a REALTOR®. And never forget that REALTORS® are pledged to uphold the stringent, enforceable tenets of the REALTOR® Code of Ethics in their professional dealings with both parties as well as the general public. Not every real estate licensee holds REALTOR® membership. Make sure yours does! Here are some of the services available


PRE-LISTING ACTIVITIES

  1. Make appointment with seller for listing presentation
  2. Send seller a written or e-mail confirmation of listing appointment and call to confirm
  3. Review pre-appointment questions
  4. Research all comparable currently listed properties
  5. Research sales activity for past 18 months from MLS and public records databases
  6. Research “Average Days on Market” for this property of this type, price range and location
  7. Download and review property tax roll information
  8. Prepare “Comparable Market Analysis” (CMA) to establish fair market value
  9. Obtain copy of subdivision plat/complex lay-out
  10. Research property’s ownership & deed type
  11. Research property’s public record information for lot size & dimensions
  12. Research and verify legal description
  13. Research property’s land use coding and deed restrictions
  14. Research property’s current use and zoning
  15. Verify legal names of owner(s) in county’s public property records
  16. Prepare listing presentation package with above materials
  17. Perform exterior “Curb Appeal Assessment” of subject property
  18. Compile and assemble formal file on property
  19. Confirm current public schools and explain impact of schools on market value
  20. Review a listing appointment checklist to ensure all steps and actions have been completed for the Listing Appointment Presentation


    LISTING APPOINTMENT PRESENTATION

  21. Give seller an overview of current market conditions and projections
  22. Review agent’s and company’s credentials and accomplishments in that specific market
  23. Present company’s profile and position or “niche” in the marketplace
  24. Present CMA Results To Seller, including Comparables, Solds, Current Listings & Expireds
  25. Offer pricing strategy based on professional judgment and interpretation of current market conditions
  26. Discuss Goals With Seller To Market Effectively
  27. Explain market power and benefits of Multiple Listing Service
  28. Explain market power of web marketing, IDX and REALTOR.com
  29. Explain the work the brokerage and agent do “behind the scenes” and agent’s availability on weekends
  30. Explain agent’s role in taking calls to screen for qualified buyers and protect seller from curiosity seekers
  31. Present and discuss strategic master marketing plan
  32. Explain different agency relationships and determine seller’s preference
  33. Review and explain all clauses in Listing Contract & Addendum and obtain seller’s signature Once Property is Under Listing Agreement


    ONCE PROPERTY IS UNDER LISTING AGREEMENT

  34. Review current title information
  35. Measure overall and heated square footage
  36. Measure interior room sizes
  37. Confirm lot size via owner’s copy of certified survey, if available
  38. Note any and all unrecorded property lines, agreements, easements
  39. Obtain house plans, if applicable and available
  40. Review house plans and make copy
  41. Order plat map for retention in property’s listing file
  42. Prepare showing instructions for buyers’ agents and agree on showing time window with seller
  43. Obtain current mortgage loan(s) information: companies and & loan account numbers
  44. Verify current loan information with lender(s)
  45. Check assumability of loan(s) and any special requirements
  46. Discuss possible buyer financing alternatives and options with seller
  47. Review current appraisal if available
  48. Identify Home Owner Association manager if applicable
  49. Verify Home Owner Association Fees with manager – mandatory or optional and current annual fee
  50. Order copy of Homeowner Association bylaws, if applicable
  51. Research electricity availability and supplier’s name and phone number
  52. Calculate average utility usage from last 12 months of bills
  53. Research and verify city sewer/septic tank system
  54. Water System: Calculate average water fees or rates from last 12 months of bills )
  55. Well Water: Confirm well status, depth and output from Well Report
  56. Natural Gas: Research/verify availability and supplier’s name and phone number
  57. Verify security system, current term of service and whether owned or leased
  58. Verify if seller has transferable Termite Bond
  59. Ascertain need for lead-based paint disclosure
  60. Prepare detailed list of property amenities and assess market impact
  61. Prepare detailed list of property’s “Inclusions & Conveyances with Sale”
  62. Compile list of completed repairs and maintenance items
  63. Send “Vacancy Checklist” to seller if property is vacant
  64. Explain benefits of Home Owner Warranty to seller
  65. Assist sellers with completion and submission of Home Owner Warranty Application
  66. When received, place Home Owner Warranty in property file for conveyance at time of sale
  67. Have extra key made for lockbox
  68. Verify if property has rental units involved. And if so:
  69. Make copies of all leases for retention in listing file
  70. Verify all rents & deposits
  71. Inform tenants of listing and discuss how showings will be handled
  72. Arrange for installation of yard sign
  73. Assist seller with completion of Seller’s Disclosure form
  74. “New Listing Checklist” Completed
  75. Review results of Curb Appeal Assessment with seller and provide suggestions to improve salability
  76. Review results of Interior Décor Assessment and suggest changes to shorten time on market
  77. Load listing into transaction management software program Entering Property in Multiple Listing Service Database


    ENTERING PROPERTY INTO MULTIPLE LISTING SERVICE DATABASE

  78. Prepare MLS Profile Sheet — Agents is responsible for “quality control” and accuracy of listing data
  79. Enter property data from Profile Sheet into MLS Listing Database
  80. Proofread MLS database listing for accuracy – including proper placement in mapping function
  81. Add property to company’s Active Listings list
  82. Provide seller with signed copies of Listing Agreement and MLS Profile Sheet Data Form within 48 hours
  83. Take additional photos for upload into MLS and use in flyers. Discuss efficacy of panoramic photography Marketing The Listing


    MARKETING THE LISTING

  84. Create print and Internet ads with seller’s input
  85. Coordinate showings with owners, tenants, and other Realtors®. Return all calls – weekends included
  86. Install electronic lock box if authorized by owner. Program with agreedupon showing time windows
  87. Prepare mailing and contact list
  88. Generate mail-merge letters to contact list
  89. Order “Just Listed” labels & reports
  90. Prepare flyers & feedback faxes
  91. Review comparable MLS listings regularly to ensure property remains competitive in price, terms, conditions and availability
  92. Prepare property marketing brochure for seller’s review
  93. Arrange for printing or copying of supply of marketing brochures or fliers
  94. Place marketing brochures in all company agent mail boxes
  95. Upload listing to company and agent Internet site, if applicable
  96. Mail Out “Just Listed” notice to all neighborhood residents
  97. Advise Network Referral Program of listing
  98. Provide marketing data to buyers coming through international relocation networks
  99. Provide marketing data to buyers coming from referral network
  100. Provide “Special Feature” cards for marketing, if applicable
  101. Submit ads to company’s participating Internet real estate sites
  102. Price changes conveyed promptly to all Internet groups
  103. Reprint/supply brochures promptly as needed
  104. Loan information reviewed and updated in MLS as required
  105. Feedback e-mails/faxes sent to buyers’ agents after showings
  106. Review weekly Market Study
  107. Discuss feedback from showing agents with seller to determine if changes will accelerate the sale
  108. Place regular weekly update calls to seller to discuss marketing & pricing


    THE OFFER AND CONTRACT

  109. Promptly enter price changes in MLS listing database The Offer and Contract
  110. Receive and review all Offer to Purchase contracts submitted by buyers or buyers’ agents.
  111. Evaluate offer(s) and prepare a “net sheet” on each for the owner for comparison purposes
  112. Counsel seller on offers. Explain merits and weakness of each component of each offer
  113. Contact buyers’ agents to review buyer’s qualifications and discuss offer
  114. Fax/deliver Seller’s Disclosure to buyer’s agent or buyer upon request and prior to offer if possible
  115. Confirm buyer is pre-qualified by calling Loan Officer
  116. Obtain pre-qualification letter on buyer from Loan Officer
  117. Negotiate all offers on seller’s behalf, setting time limit for loan approval and closing date
  118. Prepare and convey any counteroffers, acceptance or amendments to buyer’s agent
  119. Fax copies of contract and all addendums to closing attorney or title company
  120. When Offer to Purchase Contract is accepted and signed by seller, deliver to buyer’s agent
  121. Record and promptly deposit buyer’s earnest money in escrow account.
  122. Disseminate “Under-Contract Showing Restrictions” as seller requests
  123. Deliver copies of fully signed Offer to Purchase contract to seller
  124. Fax/deliver copies of Offer to Purchase contract to Selling Agent
  125. Fax copies of Offer to Purchase contract to lender
  126. Provide copies of signed Offer to Purchase contract for office file
  127. Advise seller in handling additional offers to purchase submitted between contract and closing
  128. Change status in MLS to “Sale Pending”
  129. Update transaction management program to show “Sale Pending”
  130. Review buyer’s credit report results — Advise seller of worst and best case scenarios
  131. Provide credit report information to seller if property will be seller financed
  132. Assist buyer with obtaining financing, if applicable and follow-up as necessary
  133. Coordinate with lender on Discount Points being locked in with dates
  134. Deliver unrecorded property information to buyer
  135. Order septic system inspection, if applicable
  136. Receive and review septic system report and assess any possible impact on sale
  137. Deliver copy of septic system inspection report lender & buyer
  138. Deliver Well Flow Test Report copies to lender & buyer and property listing file
  139. Verify termite inspection ordered
  140. Verify mold inspection ordered, if required Tracking the Loan Process


    TRACKING THE LOAN PROCESS

  141. Confirm Verifications Of Deposit & Buyer’s Employment Have Been Returned
  142. Follow Loan Processing Through To The Underwriter
  143. Add lender and other vendors to transaction management program so agents, buyer and seller can track progress of sale
  144. Contact lender weekly to ensure processing is on track
  145. Relay final approval of buyer’s loan application to seller Home Inspection


    HOME INSPECTION

  146. Coordinate buyer’s professional home inspection with seller
  147. Review home inspector’s report
  148. Enter completion into transaction management tracking software program
  149. Explain seller’s responsibilities with respect to loan limits and interpret any clauses in the contract
  150. Ensure seller’s compliance with Home Inspection Clause requirements
  151. Recommend or assist seller with identifying and negotiating with trustworthy contractors to perform any required repairs
    152 .Negotiate payment and oversee completion of all required repairs on seller’s behalf, if needed The Appraisal


    THE APPRAISAL

  152. Schedule Appraisal
  153. Provide comparable sales used in market pricing to Appraiser
  154. Follow-Up On Appraisal
  155. Enter completion into transaction management program
  156. Assist seller in questioning appraisal report if it seems too low Closing Preparations and Duties


    CLOSING PREPARATIONS AND DUTIES

  157. Contract Is Signed By All Parties
  158. Coordinate closing process with buyer’s agent and lender
  159. Update closing forms & files
  160. Ensure all parties have all forms and information needed to close the sale
  161. Select location where closing will be held
  162. Confirm closing date and time and notify all parties
  163. Assist in solving any title problems (boundary disputes, easements, etc) or in obtaining Death Certificates
    1. Work with buyer’s agent in scheduling and conducting buyer’s Final Walk-Thru prior to closing
  164. Research all tax, HOA, utility and other applicable prorations
  165. Request final closing figures from closing agent (attorney or title company)
  166. Receive & carefully review closing figures to ensure accuracy of preparation
  167. Forward verified closing figures to buyer’s agent
  168. Request copy of closing documents from closing agent
  169. Confirm buyer and buyer’s agent have received title insurance commitment
  170. Provide “Home Owners Warranty” for availability at closing
  171. Review all closing documents carefully for errors
  172. Forward closing documents to absentee seller as requested
  173. Review documents with closing agent (attorney)
  174. Provide earnest money deposit check from escrow account to closing agent
  175. Coordinate this closing with seller’s next purchase and resolve any timing problems
  176. Have a “no surprises” closing so that seller receives a net proceeds check at closing
  177. Refer sellers to one of the best agents at their destination, if applicable
  178. Change MLS status to Sold. Enter sale date, price, selling broker and agent’s ID numbers, etc.
  179. Close out listing in transaction management program Follow Up After Closing


    FOLLOW UP AFTER CLOSING

  180. Answer questions about filing claims with Home Owner Warranty company if requested
  181. Attempt to clarify and resolve any conflicts about repairs if buyer is not satisfied
  182. Respond to any follow-on calls and provide any additional information required from office files.

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