Generally speaking, when people put their homes up for sale, they do it through a real estate agent, who then promotes the property on their behalf. However, sometimes a seller will choose to put the house up for sale themselves, in what is known as a “For Sale By Owner” or FSBO listing. But what exactly is the importance of an FSBO listing, and what factors do you need to consider when purchasing a home from one?
What is an FSBO Listing?
In essence, a For Sale By Owner listing is what it sounds like: a seller chooses to put their property up for sale without going through a real estate agent or brokerage. This means that many of the responsibilities that would normally be handled by the agent, including negotiating the price of the property and advertising to prospective buyers, are handled by the sellers themselves. Often, sellers will choose this option because it allows them to save on the costs of hiring the agent.
What Are the Benefits of an FSBO Listing?
For the seller, the benefits are obvious: because they do not need to pay for an agent, they can keep more money after the sale has closed. It also means having more control over the process, compared to handing the reins over to an agent or brokerage. For the buyer, it can potentially mean a better opportunity to negotiate for a more favorable price with the seller, a seller may accept less since they are not paying a real estate commission.
What Are the Risks of an FSBO Listing?
Unlike with a listing through an agent, FSBO listings do not receive the same protections under New Jersey law, meaning you do not get the same three-day review period to look over the contract with a lawyer. All negotiation must occur prior to the contract being signed. This increases the chances of an unfavorable outcome to the transaction if you do not have an attorney involved from the outset.
What Should You Do?
The best way to protect yourself from trouble from an FSBO listing is to ensure you hire an experienced real estate lawyer to represent you. They can look over the contract and ensure that all of your interests are protected, while navigating through any hurdles that may arise. The sooner you call, the sooner they can get to work for you.
The New Jersey real estate lawyers at Riley and Gutman, LLC, are ready to assist you with your real estate transaction. We are committed to providing prompt, experienced and personal service to our clients, and will provide you with the legal support you need throughout your transaction and beyond. Give us a call at 731-431-0300, or visit our contact page for more information.