Unfortunately there are more disadvantages than advantages to selling your home For Sale by Owner (FSBO) if you do not have the proper representation in at least some capacity on your side.  Those who attempt it on their own without any assistance at all, do quite often fail…either in finding a buyer, getting the price they want, actually closing escrow or being sued later down the line for improper paperwork, missing legally required forms, not disclosing issues, repairs, conditions, etc.

1. There are too many people to negotiate with

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale by Owner (FSBO) on your own without any assistance.

• The buyer or cash investor who wants the best deal possible and is hoping that you are unprepared and uneducated to simply take advantage.
• The buyer’s agent who solely represents the best interest of the buyer and is seeking typically 3% commission. In addition you will be contacted by the buyers transaction coordinator who will be requesting a lot of information and legally required forms from you, but who cannot provide these for you or assist you in completing them.
• The buyer’s attorney (in some cases)
• The home inspection companies which work for the buyer and will almost always find some problems with the house and then give outrageous bids for repair costs to allow the buyer to ask for a credit for repairs to get the sales price down.
• The appraisal ordered by the buyer’s lender as a condition to the loan.
• The title company and escrow officers and assistants
• The buyer’s lender and loan officer and any assistants

2. Exposure to prospective purchasers

Not being on the MLS will decrease your exposure to a lot of potential buyers.  Most of them are not searching independent For Sale by Owner (FSBO) sites.  However if you put your home on the MLS even through a cheap service that does not offer you any assistance you are then contractually obligated to offer a commission to the buyer’s agent of typically 3%.   Buyer’s agents may avoid a For Sale by Owner (FSBO) listing and may block their client from seeing it as they see it as more work and liability for them if you are not represented in some capacity.  Plus they are obligated by a fiduciary interest to serve the best interests of the buyer, not to you the seller.

3. Selling For Sale by Owner and keeping in legal compliance has become more and more difficult

The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory and lawsuits have become more commonplace. This is one of the reasons that the percentage of people selling For Sale by owner has dropped dramatically over the past few decades.

4. You will become a target for many agents who cruise For Sale by Owner listings

You will be surprised to find that they will call, knock on your door, email and mail you information trying to get your listing. They will try to talk you out of selling your home on your own and will try to convince you that paying 6% is something you should do right now.  That may or may not be the case, but if you are close in terms of what you owe vs. what your home is worth, if you don’t trust that agents have your best interest at heart or if you are trying to maximize every dollar it certainly doesn’t hurt to try For Sale by Owner (FSBO) first, it may in fact be your only option if you do not have enough equity to pay off the loan and pay the closing costs including 6% commission.

Some agents will call and offer to send you the needed forms and disclosures free of charge just for talking to them.  Be careful of this because first of all they are legally not allowed to distribute these forms to non-agents for use (it is copyright infringement), and they certainly cannot assist you in filling them out.  In addition you will have no way of knowing if they gave you the most legally up-to-date or necessary forms as they do not have a fiduciary duty to you, and there is no liability to them if what they gave you are not the correct ones.

Bottom Line

If you decide to take on the challenges of selling your house on your own, due to the disadvantages of For Sale by Owner, it is crucial to have an experienced For Sale by Owner real estate attorney and broker in your corner to guide and assist you through the process and handle most of it for you, at a much lower cost which we know is important to you.

Highly Rated and Experienced California Real Estate Broker Attorney and Lawyer handling For Sale by Owner (FSBO) Real Estate Sales.

Please call, email or use the contact form on the right today to schedule a complimentary attorney consultation.  The For Sale By Owner (FSBO) service is provided electronically and by phone, so I can efficiently serve clients in any California county – presently I am accepting clients throughout Northern and Southern California. With substantial legal and real estate experience, I am able to provide value where most agents and attorneys alone simply cannot, this is the benefit of hiring an experienced real estate attorney who is also a licensed and practicing real estate broker. This is a combination that is hard to find but important to have on your side.