Pursuing a private home sale without real estate agents?

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FatChance

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We have found a home on a golf course in Arizona that we are interested in to live in and it is not currently listed. We are very familiar with the local market. The motivated owner of his rental property is a lawyer that we met in a social setting and we are considering doing a private cash transaction between the two of us to avoid the normal realtor fees to save both of us money. What is the best way to proceed?

There would, of course, have to be a home inspection before final agreement on the sale price. We have purchased several homes in the past with real estate agents, but this is a new process for us. I assume we should engage a buyer broker or lawyer to protect our interests but want to know what to do, what to expect and what we might pay for such a service. I think we can privately negotiate a sale price ourselves but will require assistance with the closing.

Any advice for how we should pursue this opportunity would be gratefully accepted.

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greekelite

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I'm curious on this as well, not that I'm in the market but just to see what my thousands of dollars went to when I sold our old condo haha I swear he was just a middle man in the price negotiation then I did the rest, contacted the lawyers, etc

I think lawyers and a trust would be mostly what is needed, and since they won't havecto pay 5-6% to the realtors that should be taken into account.

Good luck!
 

Snowman

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We bought ours through a private party 'for sale by owner'. We agreed to a price and used a local title company to handle all the titling and escrow paperwork.
 

MWard

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The appropriate answer would be to find a realtor who would handle the transaction. Whether it be a full service, or where they just handle the paperwork and that’s it. Personally, I would hire an agent, especially if this is not your forte. It’s an inexpensive cost compared to what the litigation would be if there were an error.
 

JB

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Contact a local title company or attorney and they should be able to handle the transaction.
 

FatChance

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The advice is appreciated and in line with my expectaions! We hope to have an in-house showing on Thursday and will have a better idea of our options going forward.

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Supersport

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If I am buying a house, I would just have my own agent unless you are getting what you know is a killer deal as a specific result of not brining one in. There is a lot that goes on behind the scenes that they help take care of. if I am selling than I can see it being worth it as you are likely saving 5-6% of the value of your home. I would talk to the title company and or contact a real estate lower and plan out the process ahead of time.
 

OldandStiff

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What @JB said. Title company and attorney. We just did it this last week on one across the street from my wife's bestie that wasn't on the market, and close in mid January. Inspection this coming week, and that can always be the messy part, but it's usually just another negotiation.
 
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I would definitely get a real estate agent, especially if the other party is a lawyer. There are so many things that can potentially go wrong, and if the other party is already a lawyer, I wouldn’t want them after me about anything when they already have the letterhead to litigate with. I have my license in Vegas and the short time I’ve been doing it, I have helped out one of my sellers out of an issue where the buyer was trying to threaten a lawsuit. Between me and my broker, we were able to convince the buyer they had no case. My clients were grateful that we were able to help them and not having to navigate the issue on their own.
 

tequila4kapp

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If you are dead set on going this route search FSBO

I recommend proceding with definite caution. These transactions are tricky / risky to begin with. Your seller is an attorney. He has specialized training which helps him in this. You do not. You enter the transaction at a distinct disadvantage. The normal way to mitigate that risk is to hire a professional to represent your interests.
 

FatChance

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Just to be clear, I have never said I would proceed alone. That is not an option. What I am asking about are options other than a traditional real estate agent for help with the discovery and closing. For instance, once there is an inspection, survey and appraisal, would engaging a title company to validate all the steps and documents (with or without a lawyer) sufficiently protect my interests?

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MWard

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Just to be clear, I have never said I would proceed alone. That is not an option. What I am asking about are options other than a traditional real estate agent for help with the discovery and closing. For instance, once there is an inspection, survey and appraisal, would engaging a title company to validate all the steps and documents (with or without a lawyer) sufficiently protect my interests?

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The title company is usually picked at time of the offer. Then once both parties are in agreement and the contract is executed, that title company would be getting both your escrow or earnest money deposit, as well as a copy of that contract. Your lender would be receiving it too.

Your lender will be in contact with the title company with making sure they’re on the same page as far as being able to perform by closing date. Usually by start of the appraisal, and then after it so they know whether to continue or if the deal is dead in the water due to value.

As far as the title company protecting your interests, no. That is not their job. Their job is to search the home’s title history and make sure the deal can legally happen as far as ownership transfer.

At the current moment, hypothetically, you are basically representing yourself in court. So is the seller. Just because the seller is an attorney though does not mean they have any clue what they are doing as far as real estate law (unless that is what they practice haha), much like a pediatrician has no idea how to be a brain surgeon. So this could either go fine if there’s no issue, or it could be problematic if one arose.
 

Chef23

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I sold a house myself without a realtor. Get a real estate attorney and they can help protect you. It isn't really that complicated. Usually the attorney will have a title insurance company they work with and recommendations for someone to do the inspection. There is nothing the realtor really does besides facilitate some stuff and an attorney can do that if you can't handle it. They may bill you a few extra hours but it will be way less expensive than 5 or 6% going to the realtors.
 

FatChance

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The title company is usually picked at time of the offer. Then once both parties are in agreement and the contract is executed, that title company would be getting both your escrow or earnest money deposit, as well as a copy of that contract. Your lender would be receiving it too.

Your lender will be in contact with the title company with making sure they’re on the same page as far as being able to perform by closing date. Usually by start of the appraisal, and then after it so they know whether to continue or if the deal is dead in the water due to value.

As far as the title company protecting your interests, no. That is not their job. Their job is to search the home’s title history and make sure the deal can legally happen as far as ownership transfer.

At the current moment, hypothetically, you are basically representing yourself in court. So is the seller. Just because the seller is an attorney though does not mean they have any clue what they are doing as far as real estate law (unless that is what they practice haha), much like a pediatrician has no idea how to be a brain surgeon. So this could either go fine if there’s no issue, or it could be problematic if one arose.
As mentioned in my original post, this would be a cash purchase, no lender involved, if that affects your response.

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thewilderside

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Definitely interested to follow along with this as we're considering selling ourselves to avoid the 6% commission but have concerns about not understanding the process.
 

MWard

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As mentioned in my original post, this would be a cash purchase, no lender involved, if that affects your response.

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So slight change, you would give the title company the executed contract. You would do your inspections in the agreed upon timeframe. You would call an appraiser and have an appraisal scheduled. Assuming a good value, the title company would do their part of examining the title and making sure it was marketable.
 

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I'm a Realtor and have well over 40 years experience in all aspects of residential real estate. As long as you have an inspection done and retain an attorney you should be alright. That being said there are a lot of potential pitfalls that a good real estate agent would help you avoid, but you should be okay.
 

MWard

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I'm a Realtor and have well over 40 years experience in all aspects of residential real estate. As long as you have an inspection done and retain an attorney you should be alright. That being said there are a lot of potential pitfalls that a good real estate agent would help you avoid, but you should be okay.
That's the hard thing to answer, cause it's kind of generalizing the transaction until we knew a lot of those details. Hell, I've yet to hear any word of a sellers disclosure which would probably make some of this a lot easier :LOL:
 

Parrot

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There's a lot of stuff an agent can do for you to save you a boatload of trouble in the process and down the road. They do this everyday. It's not a guarantee but they help tremendously.

If you decide to go without an agent, get everything in writing. I mean down to the last wobbly drawer pull that is seller's responsibility. Don't rely on the old "his word is good, he won't do me wrong" notion. While it probably is, if it costs him money after the contract has been signed, sellers can get really hinky really quickly. Don't rely on the seller to tell you everything that state law requires him to tell you. An inspector will not catch everything and some are lazy as hell.

Document everything. Don't rely on a memory or what you think y'all just agreed to. If something is on a list, make sure it is checked off before proceeding. You likely won't remember that down the road, if need be.

I'm a lawyer. In the risk management part of my practice, I do my best to help folks minimize their risk in whatever situation. Having litigated several non-agent property sales, I know one thing. It's better to spend a little money on the front end that pay a lawyer on the back. As I said, it's not a guarantee, nothing is, but it can save you more than it costs.
 
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DataDude

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Contact a local title company or attorney and they should be able to handle the transaction.
This is my advice after the home inspection of course.
 

dduarte85

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We went attorney to attorney ... as is, no home inspection.

Been four years, best decision ever... seller knocked 11% off market to save from realtor fees on his end.
 

MWard

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We went attorney to attorney ... as is, no home inspection.

Been four years, best decision ever... seller knocked 11% off market to save from realtor fees on his end.
You didn’t do a home inspection? Was there a reason why?
 

dduarte85

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You didn’t do a home inspection? Was there a reason why?
As is, no concessions to be made... why drop 1,000 bucks? My father was in the trades and saw enough to say “it has good bones”.
 

MWard

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As is, no concessions to be made... why drop 1,000 bucks? My father was in the trades and saw enough to say “it has good bones”.
Fair enough
 

dduarte85

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Fair enough
I think one of the keys we looked for was just water damage... basement was unfinished (no water stains on any wood) and there were boxes / wood / items all over the floor... so that read to me as no history of water damage. NE doesn’t typically have mold problems in open homes, today’s builds are too tight and closed so that’s a double edge sword to me. My house breathes baby (my oil bill confirms this).
 

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