[photopress:contracts.jpg,thumb,alignright]The most common obstacle to being successful at selling your home on your own, on your own meaning a truly private sale with no agent at either end, is the contract phase.
Owners usually figure out all of “their stuff”. Getting the house ready. Pricing the house. Putting out ads. Being available to show the house. The “missing” part is the “buyer’s stuff”. While it may seem that the buyer should figure out their end of things…that is not a realistic expectation on the part of the seller, most of the time. It is also the reason that many “successful” For Sale By Owner’s only end up saving a portion of the commission, and not the entire commission. I have heard many stories over the last couple of decades from For Sale By Owners saying “everyone loves the house and then leaves, and we don’t hear from them again”. That can be very frustrating for a homeowner. The buyers come, rave about the house, leave, and the owner is left scratching their head saying “What’s up with that?!?!”
Whether a buyer is working with an agent or not, they usually focus more on looking at houses, than on what happens when they find the house they like. Unless your house is so hands down, oh my god, have to have it…it is unlikely that a buyer will have the supercharged motivation needed to get to the next step. Timing is everything. If the owner whips out a contract when a buyer comes in…it may scare the buyer. If they don’t whip it out before the buyer leaves, often the owner doesn’t get a second chance.
So here’s my advice. Find a lawyer who will draft a simple, layman-term version of a standard purchase and sale contract for you. Something an average buyer can REALLY UNDERSTAND, that covers all of the bases in something less than the standard legalese. Make it on as few papers as possible, while still covering the main points. Do NOT, in other words, simply use the standard format that agents use with multiple addendums. Have most of the “addendum” topics covered in one standard contract. If your house was built prior to 1978, have the lead based paint automatically built into the contract. We use an addendum for that because some need it and some don’t. But you already KNOW if your house was built prior to 1978…so get it put right into the contract, and have the booklet regarding hazard info readily available.
Instead of waiting for the buyer to have to say “I’d like to buy your house”, hand everyone who comes through, a sealed envelope with the flyer attached to the outside of it. In the envelope include the Seller Disclosure Statement and the contract (and a pre-inspection, and…). Complete the contract with everything that YOU want. In other words, you make an offer to them…rather than waiting for them to make an offer to you. Have the name and phone number of the attorney who drafted the contract in the envelope, so they can counter with modifications to your pre-presented offer. Of course you should also state that they can use an attorney of their choice, OR call the attorney who drafted your document.
When you hand them the envelope, tell them “everything you may need is in this envelope, including everything we know about the house”. This way you are giving them information, instead of pressuring them with regard to buying your home. If they like your house at all, they will want to open that envelope to see the Seller Disclosure Statement.
You might say as they are leaving, “If you are not at all interested, then I’d appreciate your leaving the envelope here to save a tree.” A nice, easy way for them to let you know that they are not interested in buying your house, without offending you. They are not saying NO to you, they are saving a tree 🙂
Make it as easy as possible for a buyer to get from liking your house to buying your house, and you may be able to save not just half of…but the entire, commission.