For Sale By Owner:
Tips for Buyers

1.  Do your Homework

• Research the Market: Understand the local real estate market. Compare the FSBO property’s asking price to similar homes in the area to ensure it’s reasonably priced.
• Get Pre-Approved: Secure a mortgage pre-approval to show the seller you’re a serious buyer and to understand how much you can afford.

2.  Consider Professional Help

• Hire a Real Estate Agent: Even though the seller isn’t using an agent, you can still hire one to represent your interests. A buyer’s agent can help you with negotiations, contracts, and ensuring you’re getting a fair deal.

3.  Conduct a Thorough Inspection

• Home Inspection: Always schedule a professional home inspection. An inspector will identify any potential issues with the property, giving you the chance to negotiate repairs or price adjustments.
• Title Search: Ensure the property has a clear title by obtaining a title search (this will be done in conjunction with the title insurance). This will help you avoid any legal issues down the road.

4.  Secure Financing

• Loan Options: Explore different loan options to find the best rates and terms. Your lender will require a home appraisal, so be prepared for this step in the process.
• Appraisal: The lender will order an appraisal to ensure the property is worth the loan amount. Be aware that if the home doesn’t appraise for the purchase price, you may need to renegotiate or bring additional funds to the table.

5.  Understand the Legal Requirements

• Purchase Agreement: The seller may not be familiar with standard real estate contracts. It’s crucial that all terms are clearly defined in a legally binding purchase agreement.
• Disclosures: Florida law requires sellers to disclose any known defects. Ensure that the seller provides a complete and honest disclosure form.

6.  Negotiate Smartly

• Price and Terms: Be prepared to negotiate not just on price, but also on terms such as closing date, included appliances, or repairs.
• Contingencies: Include necessary contingencies in the contract, such as the property passing inspection and your ability to secure financing.

7.  Verify Homeowner’s Insurance

• Insurance Requirements: Before closing, ensure you can obtain homeowner’s insurance for the property. Some properties may have issues (like location or condition) that make them difficult to insure.
• Coverage: Verify that your insurance coverage meets your lender’s requirements and provides adequate protection for your investment.

8.  Communicate Clearly

• Direct Communication: Since you’re dealing directly with the seller, maintain clear and open communication. Ensure all agreements are documented in writing to avoid misunderstandings.
• Negotiation Etiquette: Approach negotiations respectfully and professionally, as you’re working directly with the homeowner.

9.  Be Prepared for a Unique Process

• Flexibility: Understand that the FSBO process can differ from traditional sales. Be flexible and patient, as the seller may be unfamiliar with real estate procedures.
• Closing Timeline: Be mindful of the closing timeline and work closely with your lender, title company, and any other professionals involved to ensure a smooth transaction.

10. Plan for Closing

• Title Insurance: Make sure an owner’s policy is purchased (either by buyer or seller according to the purchase contract) to protect yourself from any future claims against the property’s title. This is a crucial step in securing your investment.
• Closing Day: Ensure all documents are in order, funds are transferred properly, and any final walkthrough issues are resolved before closing.

Buying a “For Sale By Owner” property can be a unique and rewarding experience, but it comes with its own challenges. As you navigate the process, remember that you don’t have to go through it alone. We’re here to offer guidance, answer questions, and support you every step of the way.