What’s a Fizbo Anyway?
FSBO stands for “For Sale By Owner” and it’s very popular right now. When selling their home, most people usually think they need to list it with a Realtor. While Realtors can provide a great service, you simply may not need all the services they provide – and you may not want to pay their 6-7% fee either. For a $250,000 house, a 7% commission is $17,500!
That fee can be well deserved by a Realtor who finds a buyer in a tough market, but in a Seller’s Market, home sellers may not need the marketing services of a Realtor. They commonly find their own buyer — pretty quickly too, sometimes!
Help! I Found a Buyer, But I Don’t Know What To Do Next.
This is where a real estate attorney comes in. It may feel like the hard work is done once you find a buyer, but it’s actually just beginning! After finding a buyer, someone needs to draw up the Purchase Agreement (also called the “Offer” or “Purchase and Sale Contract”). If neither side has a Realtor, an attorney can draft one for you. In fact, having a legal professional draft your Purchase Agreement will ensure it’s done correctly and in your best interest.
After that Purchase Agreement is signed, there is still a lot to do to get ready for the closing. In Iowa, that list can include the following:
- The Seller Disclosure Statement (should be signed with or before the Purchase Agreement)
- Lead Based Paint Disclosure Form (if house is built before 1978)
- Home Inspection
- Radon Inspection
- Wood Destroying Pest Inspection
- Abstract Update and Delivery to Buyer’s Attorney
- Title Opinion or Title Commitment
- Form 1099-S
- Time of Transfer Inspection for Septic Systems
- Preparing the signing the Tax Proration Agreement
- Preparing and signing Deed, Declaration of Value and Groundwater Hazard Statement
- Holding and delivering earnest money
- Delivering all documents to the closer
- Reviewing and correcting any errors on the HUD/Closing Disclosure
That’s a lot!
And for the average person who might sell their house once every 5-7 years, it’s likely not fresh on your mind from the last time you did it. Or if it is, things many things have probably changed from that last time you sold.
But your local real estate attorney is well versed in the process. At Hubbard Law Firm, we typically have anywhere from 20-50 sales open at any given time where we are assisting the Seller with the items in the list above.
Real Estate Attorneys Ensure You Are Protected
You might also have noticed the list above looks different than what you might expect if you’re from a state other than Iowa. Iowa maintains a unique system, relying on abstracts and title work, while other states simply issue title insurance. If you’ve sold property in a different state, you might find the typical things you’re used to — Escrow Companies and Title Insurance — are very different in Iowa.
An Iowa real estate attorney will make sure everything is done correctly and on time. Nothing’s worse than having a delayed or missed closing because the Seller missed one or multiple items in the list above.
And we make sure your transaction meets the latest requirements and changing laws – like the new changes to the Declaration of Value Form, set to go into effect July 2016. We watch out for these details so you don’t have to.
Do You Need Help With Your FSBO?
If you’re selling your home FSBO and could use some assistance, I’d love to help you out. It’s a fun part of my job to successfully get people to the closing table, whether they are buying or selling. I would be happy to help you out and take the worry of a FSBO sale off your plate.
And we are paid only at closing right out of the closing proceeds. When else can you say you hired an attorney and never had to write them a check!