FSBO West Michigan For Sale by Owner Real Estate

Step 1. Prepare your home for prospective buyers.

To prepare your home for prospective buyers, you must make minor repairs, clean, paint and do landscape maintenance. The exterior and interior are equally as important. It is not necessary to remodel your home or pay for a costly addition. The checklists below outline everything you should do to enhance your home’s appeal to a potential buyer. These tips will add value to your home and could mean the difference between a quick sale at your asking price and a lengthy sale at a lowered price.

Step 2. Determining a Price

Determining a selling price is the single most important aspect in selling your home. The value of your home depends on the neighborhood in which the house is located (the biggest factor in determining value), the condition of the house, current market conditions, interest rates and the length of time the house has been for sale. In order to receive the best price for your home, you have to determine the price that comparables (homes that are similar in terms of style, size, condition and location) in your neighborhood are selling for. There are three ways to determine your home’s value: 1. Research the market by comparing the average asking price in your neighborhood (this information can be found by checking classified advertisements) with the average selling price (this information can be found at your city assessors office) in your neighborhood. 2. Ask a real estate agent to do a market analysis of your home (real estate agents will do this for free but you should tell them you are considering selling your home yourself) or 3. Pay for a professional appraisal (the cost is approximately $250 to $300). A professional appraisal is money well spent if you want certainty in determining the asking price. It can also be used during negotiations with a buyer.

Step 3. Marketing Your Home

The most important element to successfully marketing your home is giving it maximum exposure. Your home will not sell unless buyers know it is available. The internet provides the largest market exposure for home sellers. An internet advertisement has the potential to reach over 1 billion people world wide including over 229 million people in the United States alone. An internet advertisement is viewable 24 hours a day, 7 days a week and with over 77 % of home buyers beginning their search on the internet, it’s a smart advertising choice. Other important marketing options include a professional For Sale by Owner sign with a brochure box in your front yard. This alerts both neighbors and others driving through your neighborhood that your home is for sale. The brochure box provides essential information about your home to potential buyers. As the seller, you also have the option of holding open houses (typically on Saturday or Sunday) or showing your home by appointment only. Other important methods include advertising in your local newspaper’s Sunday classified real estate section (keep your ad short but remember to indicate the website where it’s featured) and word of mouth – tell relatives, friends, neighbors, co-workers, church, mosque or synagogue members, hairdresser or barber, doctor, plumber and carpenter – virtually everyone you know - that your home is for sale.

Step 4. Negotiating Offers

Before negotiating with a buyer, you must understand that selling your home is a business transaction. To negotiate successfully, you must stay calm and in control at all times. Set aside the emotional feelings you have about your home and take nothing personally. Strive for a deal that is win-win. This ensures that you and the buyer feel you both have gained from the sale. When a buyer is prepared to make an offer to you, request a pre-approval letter from the buyer’s mortgage company. This informs you that the buyer meets the lender’s preliminary qualifications for a mortgage. After receiving an offer to purchase (it must be in writing to be legally enforceable) you have three options. It is recommended that you do not discuss price, negotiate property or a date to vacate until you have a written offer. Once you have an offer, you can accept it, reject it or make a counteroffer. If you have several offers, consider all of them and respond to the most attractive. Once you and the buyer agree on terms and both parties sign the purchase agreement, the offer has been accepted. An offer can be withdrawn at any time prior to your acceptance. Once you have accepted, it is binding. If you make any changes to the buyer’s original offer, it is considered a counteroffer and the original offer is dead. The buyer’s offer should include an earnest money deposit. An earnest money deposit isn’t required but it shows that the buyer is serious about purchasing your home and is a potential source of damages if the buyer backs out without cause. The earnest money is held in a special escrow account (this can be handled by an attorney, lender or title company). If the offer is accepted, the earnest money is included as part of the buyer’s down payment. If the offer isn’t accepted the earnest money is returned to the buyer. An offer to purchase may include contingencies – conditions placed in a contract which requires a specified event or action to happen or not to happen before the contract is binding. An example of a contingency is a buyer obtaining a professional inspection of the property being purchased. Each contingency should be covered by a time limit.

Step 5. Closing On Your Home

The closing is the final step in the process of selling your house. It is the process where property funds and title are transferred between you and the buyer. The closing is usually at the title company but can also be held at your attorney’s office or the lenders office. It typically takes about an hour. Several days prior to closing, you should provide the buyer with a walk through inspection to verify that you have complied with the terms of the purchase agreement. Also prior to closing, the title company will prepare a closing statement or settlement statement which details the amount owed by the buyer and the net amount received by the seller. A closing statement is required for every real estate transaction that involves the transfer of property. At the closing, the title company, as a neutral third party, receives and distributes funds, ensures all conditions have been satisfied, confirms that the buyer receives appropriate documents and provides an accounting for the transfer process.