If you decide to sell a property without a real estate agent, it may save you time and money. However, there are several items that should be included in your agreement with the buyer.
Transaction agreement
The document, called a For Sale By Owner (FSBO) agreement, should list the full names and addresses for the buyer and seller. It should include a detailed property description and the purchase price.
If you intend to ask the buyer for a deposit, the amount should be listed in the agreement as well as the date it is due. The agreement should note the closing date and any financing terms, like the loan amount and interest rate.
It should also specify which party is responsible for closing costs and the costs of repairing any items that come up during the home inspection. If you are providing a home warranty, the details of coverage should also be included with the agreement.
All parties should sign and date the agreement. Occasionally, disputes may arise, and you may want to include a process for dispute resolution.
Common disputes
A FSBO transaction may lead to disputes about the sale price or the value of the property. The buyer may claim that there are defects with the property that were unresolved before the closing.
If the buyer has difficulty obtaining a loan for the property, they may want to lower the purchase price, which could also lead to a dispute. If these disputes are not resolved, it can prevent the closing.