A Guide to For Sale by owner properties - FSBO

A FSBO is a property that is for sale by the owner and not a real estate brokerage. Many times if you can find a FSBO that will work for your client there is less competition as the property is not typically marketed to the masses as it would be if listed in MLS. 

A few things to keep in mind when working with a FSBO are :

• Your Responsibility - You can most likely expect to handle most of the sell side tasks as they will not have representation and most likely not be as familiar with the processes. 

  • Keep in mind that you represent the buyer. Your job is to communicate next steps to the seller in order to help move the process forward but you should never do anything to compromise your fiduciary duty to your Buyer client .

  • Escrow - You will need to verify who will be holding the escrow. Typically the seller's attorney will hold these funds but ROVI Homes will hold them as well if the Seller prefers. 

• Lead Paint - You will need to provide the seller of a property built prior to 1978 with a lead paint packet and disclosure sheet . 

  • Keep in mind you should not be helping the seller fill out the lead disclosure . SImply provide it and advise them to review it with their attorney prior to filling out. 

• Compensation 

• You will need to write in the commission amount into the offer.

“Seller agrees to pay a commission to ROVI Homes in the amount of x % of net sale price at closing."

• Options for your buyer in regards to your commission 

Situation example - You have a buyer contract signed for 3% but the seller is offering 2%

• Your buyer can pay the difference

• Your buyer can ask the seller to pay the additional commission ( This request must be from the Buyer to the Seller in the offer …

“ Buyer requests that the Seller pay 3% buyer agency commission to ROVI Homes “

• Your buyer can roll the difference into the offer amount  ( if your buyer chooses this option make sure to explain to the seller )

If you are considering calling FSBO properties to list click HERE for Kirk’s Master FSBO Scripts