In a real estate transaction where licensed agents are involved, usually, a commission is paid to the agents. That commission is paid by the SELLER, traditionally paid out of the money that the seller receives for the property being sold, and it’s thousands of dollars.
This is one big reason a lot of people consider selling their home themselves, as a “For Sale By Owner”, or “FSBO”. The idea is to cut out the agents altogether and not have to pay out that commission.
To point out the obvious: we believe that sellers (and buyers) should work with a licensed agent! Why? Well,….
How many people do you know who are willing to work for free? Not too many, right? Well, agents don’t want to work for free either. Often, it’s a bit unclear as to exactly what the agent is doing for you the seller, or for the buyer. It doesn’t seem like “Thousands of dollars for a couple of phone calls” is right. But: the agent is doing a lot more than spending time on the phone. Let’s break it down into some more detail.
Are you prepared to do these things, which a licensed agent will do FOR you?
- Advertise the home on the internet, in print, on handouts/brochures. As a FSBO, your property is NOT entered into your area’s MLS database, so you cannot compete on a level playing field with other sellers. You should have a plan for marketing your home on the internet. FaceBook? Craigslist? Budget time every day for keeping up with posts, emails, and responses to your ad(s). Buyers who don’t get timely responses will move on to the next property.
- Are you able to objectively sell this property? Can you set a reasonable and competitive price? Are you open to feedback from potential buyers, especially negative feedback? This process can be more emotional than you think.
- You must make a phone number available to the public so they can contact you for showings. If you don’t want to use your own phone number, will you purchase a phone and get service for it?
- You must schedule each preview, showing, and open house. If you can’t set an appointment when the buyer wants it, that buyer WILL move on to the next available property. Are you able to drop everything, every single time the phone rings?
- During all interactions, you need to be careful about what is and isn’t said to a potential buyer. Remember, you have NO ONE on your team for advice, to help you avoid legal trouble. This is risky business. If you do choose to pay for an attorney, that will eat directly into the money you are trying to “save”.
- Do you know how to handle multiple, competing offers on your property? Do you know how to negotiate with a licensed agent who represents the buyer, and understand how you are at a disadvantage? Do you know what contingencies are, and how to deal with them? We’re talking contract law here.
- Do you understand what title insurance is, how to order title work, how to interpret it, how to resolve issues related to it?
- Do you understand how the deal is structured differently depending on the type of funds the buyer will use? Are you able to ensure your potential buyer has the means to buy your property? ARE they qualified for a large enough loan to buy your property? A RE/MAX Mountain West agent does this work for you, before a buyer even schedules an appointment for a showing.
- Can you read and understand a settlement statement? Do you know how to identify and resolve problems on this statement? What about the closing, do you have a good knowledge of what has to happen in order to close, especially if the buyer is working with a lender?
- It isn’t discussed much, but there is a reason that licensed agents have special insurance in case there is a problem with the transaction. If there is a potential legal dispute about the transaction, are you financially prepared to defend yourself?
- You must interact with the buyer, the buyer’s agent, possibly an attorney, the title company, possibly an appraiser, the inspector, and maybe a lender too. Do you have time for all that? Do you have time to do this for days, or months? A common issue with FSBO properties is that they sit on the market longer than other properties because the seller isn’t able to handle all of this activity at the same time. Properties that sit on the market longer appear to have something wrong with them, whether it’s the price, or something worse. Don’t be that guy!
This is a partial list of what a licensed agent will do for you. This process is much more legally complicated than selling other types of property, like a car or a boat, which is why there are licensed professional agents available for you at RE/MAX Mountain West.
Give us a call. Let US do all this work, FOR you. Take advantage of the high level of professional service and expertise that puts RE/MAX Mountain West on the map, and keeps people coming back for decades. Let us help you sell your property, it’s worth every penny!