Buying a FSBO without an Agent
Oh, those overpaid real estate agents, who needs them? Believe it or not, this is the feeling of many real estate consumers when they contemplate buying or selling a home. Though they may know nothing about the process, they will freely enter into it, affixing their names to one of the most significant documents they will ever sign, without professional representation.
Sure, it may seem that I have an agenda in cautioning you to not forego an agent’s services; I am, after all, a real estate agent. With my real estate license, however, comes a fiduciary duty to the real estate consumer, one that I take quite seriously.
My services are free
It’s amazing to me how many people I meet during the course of a business week that don’t know that it’s the seller who pays all the real estate fees at closing. This includes not only their real estate broker’s commissions, but the buyers’ agent’s as well.
It is important to have professional representation when you purchase a home. Even if you think you can do it alone you must remember that there are major steps to the purchase process, many people involved in the transaction, time restrictions, legal requirements and more to consider.
Not many things in life are free, so the fact that you can hire someone to represent you in one of the largest financial transactions you’ll ever be a party to, at no cost to you, is pretty compelling.
Not all FSBO sellers cooperate with brokers
When a FSBO seller agrees to pay a buyers’ real estate agent’s commission the process is known as cooperating with brokers. Not all FSBO sellers are willing to do so. If you’ve decided to work with an agent in the purchase of a FSBO, ask the seller if he or she is willing to pay your agent’s commission.
You won’t necessarily get a discount
Many FSBO buyers are under the impression that, since the seller doesn’t have to pay an agent’s commission, he or she will be willing to discount the price of the home accordingly. Nothing could be further from the truth.
Consider this: the typical FSBO seller is single and earns less than the area median income. He or she is less likely to offer help with closing costs than home sellers with agents, according to the National Association of Realtors (NAR). Furthermore, the number one reason a homeowner chooses to go it alone when selling is to save the money they would’ve paid in commissions. They are not about to give this money to the buyer of their home.
While the for-sale-by owner isn’t a common strategy, if you see one you’d like to view, call your real estate agent who will go to bat for you from the outset.