Why You Need An Attorney When Selling Your Home FSBO (For Sale By Owner) - August 2016
For most people, a home is the most expensive thing that they will ever sell. While not as common, some individuals choose to sell their home "For Sale by Owner" (FSBO). The reasons may vary as sellers may want to be in charge of marketing or save the expense of a listing agent's commission. Starting the process of selling FSBO can be as easy as putting a "For Sale by Owner" sign in your front yard, and some brokerage services may offer to list your property on the multiple listing service (MLS) for a low flat fee. However, the sale of real property is more than just a marketing exercise. Selling a home FSBO has become more and more difficult, as the process of selling and buying a home has become more and more complex. There are many legal issues involved in a real estate transaction, including mandatory disclosures and regulations. If a seller does not seek legal advice from an experienced real estate attorney, the legal consequences from mistakes or omissions during the selling process can cause some major headaches—not to mention potential liability.
An attorney can guide you through the paperwork required in selling a home, ensuring that you are complying with state law every step of the way. For example, Virginia law requires that certain disclosures be made to the purchaser, and further mandates the forms on which disclosures are made. Once you receive an offer on your home, an attorney can prepare the purchase contract and assist you in negotiating the terms to make sure your interests are protected, such as ensuring you have adequate remedies if the purchaser does not follow through. This is especially important where the buyer is represented by his or her own agent or attorney. An attorney can also assist you in dealing with other parties that are involved in the transaction: a home inspection company, contractors hired as a result of the home inspection, appraisers, or even your bank, in cases of a short sale. And if necessary, an attorney may be able to assist you in enforcing the terms of the purchase agreement if the purchaser defaults.
While you are not required to hire an agent to sell your home or represent you as a purchaser, it is highly recommended that you obtain legal representation to assist you in navigating one of the largest and most significant transactions you will make in your life. It is particularly important to engage the services of an attorney where there are unique circumstances in the sale of the property, such as easements, liens on the property, illegal additions or improvements on the property, or if you are selling a house with a non-cooperative co-owner. Even if you are not selling FSBO, it is recommended that you have an attorney review all contracts (even a listing agreement) before you sign and all closing documents as early in the process as possible. Real estate agents can be very helpful in marketing your property and negotiating with purchasers and other parties involved in getting you to the closing table; however, they are not able to provide legal advice.
If you are thinking of selling your home FSBO, contact an attorney as early as possible in the real estate transaction process so that your attorney may review the pertinent documentation and properly advise and protect your interests before documents are signed.