How do I decide on selling my own home…without an agent?

Hmmm…what a great question. I’ve met many folks who have to sell their home given the economy but because their home is “under water” or “upside down” in terms of the mortgage-to-value that they can’t afford an agent. Many stop there and say, “I guess I need to do a short-sale or go into foreclosure.” Think again.

    Here are some questions to ask yourself in deciding if you should pursue selling your own home without an agent.

  • Do you have 5-6 hours/week to spend managing this process?

    Selling your own home is not rocket science but it is time consuming. You need to commit the time if you want to sell your home quickly. When you eliminate the agent, you take on all the responsibilities of marketing your home! Assume that once your house is listed, you’ll be spending at least 5-6 hours a week fielding inquiry calls, scheduling appointments, preparing/leading showings, etc. This will taper as you enter escrow where it’s primarily about distributing the right forms, waiting for signatures, getting proper documents into escrow, etc. The less confident you feel about any step of this For Sale By Owner (FSBO) process, allow yourself more time so that you can do the research you need to accomplish each task.

  • Have you ever sold or bought a home, even if using an agent?

    If you’ve never been through the process of selling or buying a home, even with an agent, I would not recommend doing it yourself. You learn a lot even having an agent manage the process. You understand that there is a purchase agreement, that that purchase agreement can be countered with a counter offer, that there are contingencies that must be properly documented and followed in the final purchase agreement, that there are title documents that must be ordered and reviewed, that there are strict disclosure deadlines, etc. If you’ve been through it once, you understand the high level process as a foundation to managing yourself.

  • Are you familiar and efficient with online research?

    The internet has made the for sale by owner (FSBO) process possible. Once upon a time, an agent or broker was the only way you could list your home on the MLS, get comps, or get the forms necessary in the sales process. Now, you can do that legwork with the touch of a button. You can analyze your market area relative to others, get detailed and accurate information on your competition (pricing, age, floor plans, etc.), list and advertise your home, and get a ton of great advise on each step of the process along the way! If you know how to use Google, research different MLS sites, and are willing to invest some time on different online advertising channels, you can market your home successfully.

  • Can you negotiate with confidence?

    Negotiating is one key aspect to selling your own home. And it’s often negotiating with an agent, who can be very intimidating to server their client. You have to know how to use basic negotiating skills; understanding the underlying desires of your buyer, knowing your walkaway point, envisioning win/win contract terms in order to get what you want out of the deal, being confident enough to ask questions, and saying ‘no’ when necessary. Some people aren’t comfortable with negotiations. And while I do it all the time, it wasn’t so long ago that I felt pretty uncomfortable doing it. I learned that as long as I prepare myself with the “right” data and right frame of mind, I can overcome demanding buyers/buyers’ agents. To learn how to better arm yourself for negotiations try our ForSaleByOwnerABC’s webinar.

  • Can you pay off your mortgage with the sale of your home?

    Some people may not be able to pay off their mortgage even after figuring in the elimination of agents’ fees in the closing costs. The last home I sold was “under water.” After I figured in the removal of the agents’ fees, I would’ve still owed $35,000 to the bank, even if I got the price I was asking. That’s how bad the values tanked in my area. After I got past the sulking, crying, and head-spinning phase, I realized that writing a $35,000 check, however gut-wrenching, was better than taking a multi-year hit to my credit history (Short-sale and foreclosure both have hefty credit implications) and continuing to pay the large monthly mortgage payments. This may not be an options for you. But if, financially, you can cover your mortgage via your selling price, then selling your own home could be a much better choice then short-selling or moving into foreclosure. I am a business owner who values credit as an asset …I couldn’t risk not being able to invest in (via partially on credit) equipment, building space, a car, or even obtain necessary suppliers’ credit.

  • Do you know what you don’t know?

    This sounds stupid. I know. But I’ve seen people walk into this process having no clue what their doing but doing nothing to build up their knowledge base in the areas they are clueless on. For instance. No knowing which disclosures are required by their state and never doing the research on what the exact list is for their area can completely dismantle your purchase agreement, or worse, open up the opportunity for the buyer to come back years later with a lawsuit. These are worst case scenarios. But even the little things can mean the difference closing escrow in one month vs. three. As long as you know where your weaknesses are in this process and are willing to spend time learning the best way to shore up your weakness, you’ll do fine. Clearly decide which aspects of the for sale by owner process (FSBO) make you the most nervous. Then find the resources you need to build your confidence. There is a lot of information out there to help you. You just need to put the time into doing the research. Don’t wing it! Get the tools and tips you need for each step of the process by registering now for our ForSaleByOwnerABC’s webinar.