Is “For Sale By Owner” your best bet?

When selling a property, many homeowners choose to go it alone. Certainly the allure of saving a hefty commission is attractive. And many of us are perfectly willing to shoulder more of the paperwork load in a tight economy to squeeze every possible penny of profit out of the deal. But going it alone doesn't mean you have to go totally solo. In fact, it may not be in your best interest to ditch the realtor, and the whole support team that relationship implies. Or maybe the deal will work out fine. It's hard to say for sure.

There are questions you can ask yourself before advertising your home for sale that may save you some king-size headaches later. If only somebody knew exactly what those questions are. But that's the trick of it, isn't it?

The fact is, every real estate deal is a unique negotiation, with myriad possibilities, prices, responsibilities, and terms to agree on. Looming over that negotiation is the anxiety that comes from knowing that this is a one-shot deal for the seller. Set the price to high, or the terms too stringently, and you may blow the deal. Set the price too low, and you may lose out on a a payday you've been working towards after decades of investment. Establish terms that are too loose, and you may find yourself holding the bag long after you thought the sale was final.

And then there's the risk of litigation. Like it or not, a buyer can come back with a list of issues that disturb them well after the closing date. In a worst case scenario, they may take an intractable stance that suggests they intend you to pick up the tab for improvements you had no knowledge there was a need for. They may even imply, or straight out make the statement, that they are willing to go to court if necessary to seek a remedy for their ills.

That is about time you may begin to seriously wonder if writing that sales document yourself was such a good idea. If you know for sure that your sales contract complies with all the appropriate State laws, your blood pressure may remain rock steady and your palms stay dry. If, however, you have doubts, you may have a long series of sleepless nights in your future, with the potential for a large and unanticipated outlay of cash if the worst occurs.

Certainly there are people who are well versed in real estate transactions who can reliably come out of a closing with their head held high and a song in their hearts. If you are one of those fortunate few, congratulations. You have earned your peace of mind, and should revel in the joys of a swift and satisfying closing. If however you are unsure of the vagaries of real estate law, prefer to avoid confrontation whenever possible, and do not see yourself as a hard-core marketing professional – the For Sale By Owner route may not be for you.

There is reason to take heart in either case, however. Because the confident seller who walks away from their real estate closing has no regrets. And the seller who assembles a team of advisors to assist with the sale just may learn something along the way about tax law that could conceivably offset that lost sales commission, plus some.

It all depends on how the deal is structured, and what you are comfortable with. Every real estate transaction is unique and deserves to be treated as if it's the most important financial deal you'll make in your entire life - because it just might be.