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What are the Risks of an FSBO?

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By : Sonia Smith    99 or more times read
The acronym means for sale by owner where a homeowner sells his or her home without hiring a real estate agent. These days, with the economic crunch, we all want to save more money. In connection to this, some homeowners who lost the equity to their homes due to the plunging values think that the only way to salvage what is left is to sell their homes on their own and keep what they would have paid as a commission to a real estate agent. While it is possible to sell your home by yourself, you should not underestimate the work involved in it. Furthermore, selling it on your own also involves risks. Nevertheless, if you are aware of what you are doing and have made your research well, you could greatly benefit from it.

Indeed, there are risks involved in FSBO selling and many troubles. First, there is a chance that you might not be able to sell your home because of the market that we have these days. Most real estate agents have the advantage since they have access to various listings and trained on how to deal with this situation. A risk of an FSBO is selling it a low price. Keep in mind that homebuyers these days are very smart when it comes to purchasing a home. They know of their advantage and did their research regarding home purchase. They are aware of your motivation to sell, thus will not hesitate on making a very low offer for your home.

Another risk you could encounter is the lack of exposure of your home. Remember that maximum exposure is necessary to be able to sell your home fast and at a high price. Because of your limited marketing chances, this kind of exposure is not just possible for your home. Furthermore, since you will be doing everything on your own, you could be dealing with a buyer who is not financially fit to purchase your home. This may result a failure with the deal before closing, thus you will be wasting a great amount of time and expense in the whole process.

It is of necessary to know that when selling your home on your own that you are exposing it to various legalities. The home disclosure alone could have several risks. Unless you are very familiar with the legal aspects of selling your home, you could find yourself in above your head.

There are cases when an owner is not knowledgeable when it comes to home prices and could overprice it, so the home will sit in the market longer and the owner might end up selling it for a low price. In some instances, an owner could sell it for less than its worth by jumping on the first offer. It is important that when selling your home on your own, you have thorough knowledge on the process from beginning to end. Consider the advantages and disadvantages of an FSBO before you proceed. Keep in mind that while you could save money with this process, you will also undergo difficulties and could risk your home.
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