10 Easy Steps for Buying a FSBO Home

Step 1. Search for Houses
Step 2. Obtain Financing
Step 3. Set up Showing
Step 4. Consider Inspections
Step 5. Make an Offer/Negotiate
Step 6. Pay Deposit
Step 7. Get Ready to Move
Step 8. Final Walk Through
Step 9. Attend Closing
Step 10. Move In

Additional Tips

Step 1. Search for Houses
Before you begin looking for a home, make a list of features you are looking for. This will save you time and will ensure that you look only at properties that meet your specific criteria. Start your search by entering the parameters on the Search Properties page on our website. Be sure to contact the homeowners if you have any questions about the property.

Step 2. Obtain Financing
A pre-approval letter is always great to get ahead of time, it gives you an accurate idea of the price range of properties you should look at and can give you an advantage over other buyers who are not pre-qualified. Make an appointment with a local mortgage company to get started. Be sure and ask what documentation they will need you to bring to the meeting.

Step 3. Set up Showing
Make appointments to walk through homes that meet your criteria. If you sign a contract with a Buyer’s Agent, make sure that it clearly states that commission will be paid only if you purchase a property shown to you by that agent. This will enable you to also look at For Sale By Owner properties without obligation to pay a commission to your agent.

Step 4. Consider Inspections
Prior to making an offer is the best time to consider any inspections you would like done to the house. Inspections are written into the Offer to Purchase as contingencies. Important inspections to consider include: home, termite, and well/septic. A home inspection should include the roof, attic, heating/cooling units, plumbing, electrical, and foundation. The cost of a professional home inspection will range from $200 - $500.

Step 5. Make an Offer/Negotiate
Once you’ve decided on a house, complete the Offer to Purchase form and deliver it to the seller. If you have any questions about the Offer to Purchase, consult a real estate attorney. The seller may wish to counter your offer, if you agree with the counter offer, return the signed form to the seller. If you wish to counter offer, you can make another offer and so on until the price is agreed upon and the offer is accepted.

Step 6. Pay Deposit
Also called earnest money, a deposit is usually required by the seller, once you’ve made an offer, to protect the seller in the event you back out of the agreement. The deposit can be any amount you agree upon, but usually ranges between $500 - $3000. The money is held by the seller or in escrow and is deducted from the sale price of the property at closing.

Step 7. Get Ready to Move
As your closing date approaches there are a few arrangements you can make ahead of time to make the transition less stressful. Have phone service and utilities transferred, mail forwarded, and other services such as garbage, cable television, and newspaper ordered.

Step 8. Final Walk Through
It is important to schedule a final walk through a few days before closing, once the furniture has been removed from the home, to make sure that all of the terms and contingencies of the Offer to Purchase were met. You can also confirm your closing date with the seller at that time.

Step 9. Attend Closing
It is important to stay in touch with the seller, your lender, and your real estate attorney (if applicable), right up until closing. Make sure that you have all of your documentation ready for the closing and review closing costs with your lender to avoid any last minute surprises. At closing you will sign the necessary paperwork and receive the keys to your new home.

Step 10. Move In
You can begin moving in the day of closing unless other arrangements have been made with the seller. Discuss moving plans with the seller ahead of time and get the details in writing so that there are no hassles and so that you are not moving in the same day they are moving out.

This is just a helpful guide to purchasing a home. If you have further questions regarding the sale of your property or the purchase of a home, please consult a real-estate attorney.

Additional Tips

Do not bring an agent with you when looking at For Sale By Owner properties unless you are prepared to pay the agent’s commission should you choose to purchase a FSBO property.

If you have a contingency on your contract such as purchase pending the sale of your house, you may request that the seller allow you to sign a 72-hour Kickout form which allows the seller to continue showing the property but gives you notification and 72-hours to remove any contingencies on your contract before the seller can accept another offer.

Ask about property taxes, utility, and maintenance costs to make sure the home fits your budget.

If you are unsure about the contract, feel free to hire a real estate attorney to look it over and provide suggestions. Your title company or mortgage company can usually provide referrals.

Make sure everything is in writing before you sign the contract. For instance, if you are requesting appliances, a home warranty, or specific repairs, make sure it’s in the contract.

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