The Secret to Getting Over Your Fear of Contracts As A FSBO Seller

Selling your home without a real estate agent has a lot of benefits. Many homeowners, however, fail to take this path because of a fear of dealing with the real estate contracts involved. This common fear is misplaced.

When it comes to legal issues, the prudent advice in most situations is to go talk with a lawyer about your situation. The sale of residential homes, however, is a unique situation. The process is so trued and tried that it has been reduced to pre-printed forms you can buy at local office supply stores or online.

How accurate are these forms? Well, consider what happens if you retain a real estate agent to help with the sale of your home. They are going to provide you with forms for listing, making counter-offers and the final purchase agreement. All of these forms are the same ones you can buy directly! In short, you aren't gaining any legal expertise by using an agent.

This is great and all, but what if you still fear dealing with pre-printed real estate forms? After all, the transaction is going to involve massive amounts of money. What if you get it wrong? Could you end up in court and lose your home?

As you can see, panic can quickly set in. If you feel this way, there is a simple answer. Hire a real estate lawyer to look over and prepare the documents! Who better to protect you from making mistakes then the actual professionals that probably wrote up the forms you are using?

Ah, but lawyers cost money. Yes, they do. That being said, the cost of a lawyer compared to what you will pay in real estate agent commissions is really no comparison at all. Let's say you hire an attorney who charges $250 an hour. Let's assume they spend 20 hours on your transaction. That equates to a fee of $5,000. Now assume your home sells for $400,000. The traditional six percent commission for the real estate agent will equal $24,000. Now, which one is the better choice?

Selling your home without an agent gives you a huge advantage in this cold real estate market. You can use the commission savings to list your home a little cheaper than those around you, which will bring the buyers in. Don't worry about the real estate forms. They are pre-printed. If you prefer professional advice, then get an attorney. You'll still save a bundle over using an agent.


Raynor James writes about FSBO issues for FSBOAmerica.org where you can list your land for sale by owner for free for 1 month.

Article Source: http://EzineArticles.com/?expert=Raynor_James

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Home Showing Tips for For Sale by Owner Sellers

Since many areas have been hit with declining property values, many homeowners are attempting to sell their homes themselves. With so many homes for sale out there, you will need to learn everything you can about selling your home for sale by owner.

Here are some tips for showing your home to potential buyers:

Give them freedom. Don't follow buyers around during the tour. You WANT them to look. No one is going to buy something that they haven't been able to inspect. Many buyers don't feel comfortable opening closets or drawers when the person who lives there is following them around. Allow them to look around and tell them to let you know if they have any questions. You could also give them a short guided tour and then tell them they are free to look around.

TMI. Too much information. There is no need to go into every single detail about your home. Give general information, draw attention to the positives, and wait for questions.

Be a Know it All. Have all your information ready. Know how much your yearly property taxes are. Have your electric and heating bills handy. If you don't have children find out what school district you are in. You should also make a list of general iformation about your home. You may want to refer to it when answering buyers questions. Learn the year your home was built, what type of furnace or heating/cooling system you have, type of foundation, etc.

Make sure they leave witha flyer of your home, complete with photos and general information. It is likely that they will be looking at several homes in a day and you want to make sure they remember your home. Make sure you have contact information (phone number, email, and web address) on the flyer.

You should also keep a blank offer to purchase real estate form, or real estate purchase contract on hand just in case they want to write an offer!

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Tips for Selling Your Own Home Online

According to Realtors.com around 80% of people looking to buy a home start their search on the internet. Are you missing out?

Smart for sale by owner sellers are taking advantage of all of the online tools that are available and they are saving thousands of dollars in real estate comissions. Selling your home online allows you to compete with real estate agents.

One way to advertise your home online is by listing it on Craigslist.org. Craigslist is a free classifieds ads website. They have listings from all over the United States, and you simply choose your city/state, and place your ad for FREE! Best of all you can even add pictures.

You can also list your home for sale by owner on popular for sale by owner websites like ForSaleByOwner.com and pay 0% Real Estate commissions
. You will have to pay a small fee. FSBO websites are becoming more popular and they will allow you to post photos, and sometimes even videos. Some offer yard signs to help market your home.

You may also want to consider making your own webpage to advertise your home. Setting up your own website doesn't cost as much as you may think. There are many free hosting companies around, and domain (a website address) can be purchased for around $10 for 1 year. Setting up your own website allows you the freedom to add as many photos and as lengthy of a description as you need. You can also set up a contact form for anyone to ask you questions by email. Having your own webpage allows visitors to take a virtual tour of your home 24 hours a day, 7 days a week. Make sure you advertise your website address on any flyers, newspaper ads, or marketing materials.

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How NOT to take Photos of Your Home When Selling

Of course you will need to take photos of your when selling for sale by onwer. You will need photos for flyers, newspaper ads, or advertising over the internet. Check out this article I wrote on tips for taking photos of your home.

I came across a blog the other day which shows poorly taken photos by real estate agents on the MLS. The blog is called It's Lovely! I'll Take it! You can learn a lot about what NOT to do from this blog! Pretty funny too

Calculate The Proceeds After Selling Your Home

The money you will have when by the closing of the home sale transaction will be the total sale price of the property. However, you won't be able to keep the entire amount as you may need to pay for debts, liens and other charges against the property. So, your net proceeds will actually be the total sale price minus the charges which mostly make up the closing costs.

Below are several important fees that are normally paid out of the sale proceeds. Knowing these charges as well as setting a fair market value for your home will help you accurately calculate your potential net profit.

Attorney's fees. Every home seller will need the help of a real estate lawyer. The attorney plays a vital role in the financial transaction not only as an advisor but also as an escrow agent when you need a third party to keep the deposit or down payment. The fee is either a flat fee at a minimum of about $350 or by the hour.

Disbursements. These refer to expenses incurred by a lawyer on behalf of the seller such as the mortgage discharge fee paid to land titles, title search fees, couriers and other charges.

Property taxes. These taxes are paid every year. However, this can be negotiated as to who will should the payment.

Transfer taxes. This is a tax that may be implemented by states, counties or municipalities on transferring real estate property within the jurisdiction. Transfer taxes may range from a small of .01% to 2.2%. It is best that before selling your home, you check your area's rates from the Recorder of Deeds, a title company or a realtor.

Mortgage. The balance of your mortgage will be paid out of the sale proceeds. Unless your mortgage is in good standing, you will also have to pay for mortgage penalty and a discharge fee paid to the lender. All mortgage payments due on or before the possession date will have to be paid by the seller.

Loans. If there's a home equity loan or line of credit secured on your home such as via collateral mortgage or caveat, it must be paid out of the sale proceeds. Also, payment for any home renovation loan will have to be taken out of the proceeds.

Home warranty. This guarantees the buyer that all mechanical and electrical appliances in the home are in good working condition on the day of closing up to the first year of ownership. A warranty costs at a minimum of $350.

Courier fee. You will need to pay this when you pay off a loan and this fee can run from $10 to $50 and upwards.

There may be other fees apart from those listed here. What's important, though, is that keep a list of the closing costs and copies of your sales documents to help you figure out your potential proceeds.

Get Ready for Your Home Appraisal

Most people should know what their home is worth. If they don't then it would be time to have it appraised without delay. In any case, what your home is really worth is a mitigating factor for deciding the money you should be able to obtain from it should you ever decide to sell. Below are a couple of pointers as to how you could get the most out of a home appraisal.

First of all you need to do your best to remain out of the appraiser way while he is in your house. It could be a temptation to inform the appraiser of all the other homes that are for sale in the neighborhood, or what you may think your house is really worth, but try to restrain your need to do so. It's usually an uncomfortable enough position to have a stranger routing through your house and trying to decide how much it's really worth. And try not to make things worse by offending the appraiser, for any reason. If an appraiser becomes uncomfortable or annoyed for whatever reason, they may have a tendency to rush the job, thus missing important things that may have impacted positively on the final number they arrive at.

Second, make sure you keep your home clean and tidy, and be sure that any maintenance work has been carried out. This is not saying that you have to be able to see your own reflection on the kitchen tiles or anything like that, but a cluttered or untidy home will make it easier to overlook aspects of the house such as how safe the interior is or how sound the structure of the house is. Make sure you all of those leaky faucets are fixed, loose carpet squares glued down and anything else that may lower your homes impression to an appraiser. If you decide to move but are planning on leaving some of the appliances behind, ensure they are in proper working condition.

Thirdly, if there has been any remodeling work or rebuilding work done to any part of the house, don't be afraid to mention this to the appraiser. This may not have the effect of raising the value of the house by an equal amount to what you invested in it, but it is vital the appraiser knows all the new parts or areas of the house and what, if any, major problems have been repaired, etc.
These are only three pointers for you to make the experience an altogether friendlier one and also to make the appraiser's job go smoothly, without ant hitches.

Buying a Home and Using a Real Estate Purchase Agreement

What is a real estate purchase agreement? It is a comprehensive real estate contract between the seller and the buyer which must be signed by both of the parties at the time of trading any property. A corporate style agreement can be quiet long and requires complying every legal standard while a single home agreement paper can be short and straightforward created only for two interested parties. Using a standard purchase agreement is very important while doing any property dealing as it provides you a legal base for your right on the property. Without proper paper work, you can never prove your right on the property you purchase in case your ownership is challenged in the court or in any other case.

The basic format of a purchase agreement outlines the name of both the buyer and the seller and identifies them by their social security number. The format also states the intent of both the parties involved and lists the address and details of the property. A legal description is stated within the format in a standard form that describes the nature of the property and any other technical details involved with it. Besides that the paper also includes all the extra features included for sale with the property like furniture, housing fixtures or any other tools or equipments to clarify the overall the area of property. It is mandatory to include all the items listed for sale in the purchase agreement so that any legal case can be settled in future which arises concerning the right over the use of property.

The second part of a standard real estate purchase agreement states all the financial terms of the agreement. A space is left to show the initial deposit of the property, total amount of cash exchange, any other legal fees required to be paid as per sale of the property, any debts taken against the property and finally the total amount of the property.

The written agreement between the client and agent must be properly detailed before any transaction takes place. In most cases the real estate agent may convince you to deposit as much money as possible but there is no fix amount you should deposit before signing the contract and every contingency are made. It's true that a seller might ask you for bigger amount of deposit but it's all up to you how much you deposit while purchasing the property.

Always clarify in the agreement on who will pay for what. You should clearly mention what fees you will pay as a buyer and what will be seller responsibility. If the agreement does not states any thing the seller will automatically pay the entire fee incurred during the process of deal.

In most cases when you buy a house you cannot pay in full in cash, you will have to apply for a loan with a bank. Do remember that a pre approval from bank does not guarantee that you will get a loan, so make sure that you include the condition precisely in the contract.

Check every other terms and condition mentioned in the contract before signing it. There might be other issues specific to your deal so you need to include special quotes within the agreement to address the particular issue. Always be specific and precise of what you want from the deal. Never hesitate to keep your point or you may have to face serious problems after you purchase the property.

A real estate purchase agreement is the back bone of the industry and without a proper and legalized agreement you can never prove your right on your purchased property so always do insist on legal procedure and follow the rules specified by the law.

Home Owner’s Insurance

Once you have purchased a home, with the help of your real estate team, you will want to make sure that you have the proper home owner’s insurance. Most lending companies will require that you carry some type of home owner’s insurance for the entire length of the loan to protect both you and the lenders in the case of an accident. Many times, the home owners insurance is chosen during the final closing of your home. This is to protect both your assets as well as the lending companies’ assets. Choosing the right home owners insurance will ensure that you are protected against any type of natural disaster or accident that may happen.

Home owners insurance is divided into many different categories with all of them being beneficial in different situations. You will have to decide what type of coverage is most important to you. The easiest way to do this is to first add in how much you own and the value of your home. This will allow you to choose a policy that will cover all of your current expenses and that you will be able to receive some type of return on everything that you already own.

Another factor that you must consider when you are purchasing home owners insurance is the different types of coverage that are offered. Many companies will have several different categories of insurance that you can choose from according to the types of things that you currently own and how this relates to what you will need replaced in the event of an accident. Once you have determined the value of all of your possessions, you will then want to add in what you know you will want covered and then determine which category of insurance this will put you into.

Purchasing home owners insurance is one way that you can ensure that your real estate investment is covered in the event of an accident. If something does happen, you will have peace of mind knowing that your property and possessions can be repaired and replaced and you will be able to move on with your life.

More Home Selling Tips

What Is Involved In Making An Offer On A Home?

An offer to purchase is a written document submitted by a prospective home buyer to the seller of a residential property. This legal document is executed once an individual is bent on purchasing the home he or she would like to live in or would like to have as an investment. But the process only begins there as negotiations between the seller and the buyer will still be involved to make sure that every detail is to their liking.

When a homebuyer has set his or her eyes on a certain property, he or she may work with a real estate agent and fill up a purchase offer form or make one themselves that will be based according to their terms and conditions. If a buyer doesn’t want to get an agent, he or she should consult with a real estate lawyer on this matter.

In the U.S., real estate laws vary from state to state hence, it is advisable that a buyer check out the standard form in his state. Learning about this legal form beforehand is the right thing to do as it will help one understand the items that need to be specified in the document. See "Selling a Home in Your State"

In writing a purchase offer, one of the important things a buyer needs to include are the fixtures that he or she wants to stay or get rid of in his future home. Specifically, the fixtures here refer to the things that are attached permanently to a residential property such as kitchen cabinets as well as heating and cooling systems. A house listed with a multiple listing agency would usually state what items the seller wants to sell with his or her house. If there are decorative items that a potential buyer would like to stay, then it should be noted in the offer. Other items that might be included are the outdoor storage buildings, windows, light fixtures and garage door openers.

A purchase offer must be based on the property’s present condition and the items that a buyer expects to be included or rid of. After a seller reviews the offer to purchase, the negotiation between the two parties starts.

Of course, a seller may not totally agree with the buyer’s terms and conditions upon receiving the first offer. He or she may just cross out some of the items not amenable to his terms and should put his initial on the changes. Otherwise, if a seller disagrees with the whole offer, he or she may propose a counter offer.

Apart from the fixtures, other items in the offer that may involve some haggling are the purchase price, the party responsible for paying the closing costs, the closing date and delivery of title and the date the seller needs to move out from the property.

Several counter offers can be exchanged during negotiations but the final contract can only be reached once both parties agree to the modifications in the offer and put them in writing. When the document is signed by the seller and the buyer, the purchase offer becomes legal.


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The Lease with Option to Purchase When To Use It

By: Gloria Smith

Not all homeowners who sell their residential property are always successful in disposing of their homes. Some may be lucky to sell their homes in just a very short period while the properties of others stay for quite some time on the market.

But those who can’t sell their homes right away should take heart as there’s an ideal alternative for them and that is to lease with an option to purchase. Offering this type of option has been proven an effective method of attracting buyers in a slow market. There are actually other advantages.

With this option, home sellers are relieved from paying a mortgage or real property taxes on a vacant property. They still earn from the monthly rental fees and get top dollar if the renter later decides to buy the property. This ensures that a home seller will not only have a tenant but a potential buyer who will most likely pay on time. Also, the homeowner is assured that the renter and eventual buyer will take care of the property as if it is already theirs.

This can be a good option for buyers with tarnished credit score as they can have time to fix it during the lease period. Also, in this situation, buyers are not forced to commit to buying the house after the lease period expires and can just leave if they feel the home is not right for them.

However, for buyers bent on keeping the house for good in the future, this may be the right solution. At least during the lease option period, no other individual can purchase the property.

A fixed purchase price may be negotiated by the seller and the buyer within or a little higher than the property’s market value while a predetermined rental fee will also be set by the seller. A lease purchase agreement normally takes from a year to three years.

Additionally, sellers benefit from a premium on top of the monthly rent on their home and an option fee of a maximum of five percent. If the home is bought once the lease expires, these two fees will be credited to the buyer’s down payment. If not, the seller retains the money.

Another advantage of this method is that both the seller and the renter/buyer gain from this situation financially. While the owner earns from the monthly rent, the renter/buyer is also given the opportunity to own the home of his or her dreams without putting pressure on his pocket. In this way, a seller helps a tenant attain his dream of owning a home he or she could be proud of.

For homeowners who wish to try this strategy, it is highly recommended that they hire a real estate lawyer experienced on this matter to come up with a legal lease purchase agreement and explain the seller’s rights. It should be understood that risks are always involved in any real estate transaction hence, sellers must ensure that they verify the credit and rental payment history of any potential buyer choosing this lease purchase option.


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What to do when you get a Real Estate Counter Offer

By Gloria Smith

The home buying process is not always guaranteed to be smooth and many buyers as well as real estate investors know this. Even though as a potential buyer you have offered a fair market price for the house of your dreams, sometimes homeowners are not readily amenable to it. It is for this reason that buyers and their agents should be equipped with the right negotiating skills that will help succeed in closing a deal.

It’s advisable that even before making a purchase offer, buyers should be properly informed about the vital aspects of the transaction. Find out if the asking price of the home you would love to buy is reasonable enough. Know that a residential property sold at more than 10 percent of its average market value could be considered overpriced. Check too if the house needs major fixing and the cost entailed as well as if the seller is really bent on disposing of his or her home.

So don’t be taken aback if after you have submitted your purchase offer, the home seller makes a second thought and counters your offer. There are even instances when two to three counter offers will be made by the seller if his or her selling price is not met.

Keep in mind that offering a low price is a good option most of the time. Avoid pressures that will make you increase your offer beyond your financial capability. The seller may expect much from you or the real estate agent may be a bit pushy but remember that you are the buyer and the decision is yours to make.

Real estate experts also point out timing is utmost importance when dealing with a counter offer. Normally, the sellers feel they are in control of the transaction if the buyer immediately responds to the counter offer. The negotiation is not giving the seller any stress hence, the feeling of being at an advantage. However, if the buyer gives a little time allowance say a few days or a week after getting the counter offer and informs the homeowner about considering other properties, that may make the seller think twice about asking for a much higher price.

Another strategy is to accept the property in an “as is” basis. This you can do especially if you included a home inspection contingency in your original purchase offer that would give you the right to check the house and request for repairs from the seller. You can keep your right to inspect, though, even if you agree to purchase the house “as is.” And should you find major defects later on, you can always decline to buy the property.

Buyers should know when to accept the offer and this would be if they feel that the counter offer is already closer to their own purchase price. But if in case the price difference is still very wide, then more negotiations will have to be made. Buyers who are more prepared will be able to work it out soon enough. Ensure that you have facts to support your purchase offer such as comparable selling prices, list of repairs needed and estimated costs. In this way, you can be sure that the seller will give you the necessary attention.

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How to Market Your Home When Selling For Sale by Owner

By Gloria Smith

If you are sellilng your home for sale by owner you may have an easier time now because of the various marketing strategies available to you. All it takes are some research, consultation with the right professionals and the determination to proceed with the transaction whatever the costs. In other words, you can sell your home yourself, but NOT by yourself. You still need some professional advice to help you along the way.

The first step you’ll need to do is to list down the features of your home that will attract potential buyers. Include the number of bedrooms, maybe some special rooms or perhaps a Jacuzzi or swimming pool, the location, the neighborhood and the proximity to public transportation and other facilities. Take photos of the exterior and interior of your home for use in flyers, print ads and web listings.

From there, you can start spreading the word to friends, relatives and neighbors that you’re selling your house. When they hear about this, the news will surely spread to other people they know who may be in search of a new home.

An open house is also a great way to market your property. Do schedule this activity so you can prepare well for the coming of visitors. Of course, don’t forget that “For Sale” sign on your front yard as a way to inform people who drive by your place.

In addition, be sure to cleanup first from the outside to the inside of your home to make it attractive to your buyers during your open house. Rid of all the clutter around the place, organize your furniture and fixtures, repaint walls and ceilings and make the house smell good. Remember that space and a relaxing ambience are vital to most buyers.

Next is to print out flyers or cards and distribute them in public areas. Your flyer should contain important information about your property, a map and one or two photos if possible. You could save some funds if you know how to make them yourself.

If you have extra budget, you can advertise in the classified ad section of your local newspaper. Keep in mind to use catchy words when describing your home and do include photos as well. You can even offer an incentive like a “finder’s fee” for those who can refer a buyer to you.

You can also hold a garage sale if you’re planning to get a little something from your extra and used furniture, accessories, fixtures, beddings and the like that you no longer need. Many people are addicted to garage sales and you just might find a buyer for your home, you never know.

You should contact a real estat attorney and find out what your state laws are regarding selling your home. What disclosures will you need? What are some common contingencies you should include in your real estate contract? Have a qualified attorney give you advice is priceless!

You should also find a mortgage broker or lender. They will help you qualify potential buyers, and can give you an idea of what a payment might be on your house. Buyers want to know first IF they can afford the payment on your home.

Finally, the web home listing service should never be missed. The internet today has become an amazing marketing tool for any item being sold. There are web listing services that you can use for free or for a minimal fee. A user will be provided with an individual web page where all the information and photos can be posted for a specific period of time.

Preventing First Home Downfalls

Buying your first home is a very exciting time in a person’s life, but it can also be very stressful and have the potential of becoming a disaster if you do not know what you are doing before you make your purchase. Because of the large changes that occur when you buy your first home, there will always be those who will get in over their head.

The main thing that you must know when you are purchasing your first home is where you stand with your search. One of the largest mistakes that many first time home buyers will make is deciding on one specific home and then only investing in that home because they became emotionally attached to it. This can cause several problems. The first problem is that you may not be able to purchase the home because something happened during the process and the deal fell through. The second problem that people will face is making an offer that is either too high or too low. It is important to make sure that you know what the house is worth and how it fits into your financial needs before you make an offer. This will prevent you from paying too much and it will also prevent you from making an offer that is too low and not getting the house.

It is important to not let your emotions get in the way when you are searching for a home, but you should also keep your emotions in check after you have chosen a home. Even though you may have signed a contract on a home, the purchasing process is not over. There are still several steps that you will have to go through with the home inspection being one. If there is a large problem with the home, or if something goes wrong during the loan process, you will have to start your search over and find a different home.

The last thing that you need to remember is your budget. To determine what your budget should be, you can look at your credit history and your credit score. If you know what your credit score is, you will be able to estimate the type of loan that will be best for you and this will prevent you from purchasing more house than you can afford. If you are care from the beginning and stay detached and use your head when purchasing a home, you will be able to find the best home to suit your needs and wants.