Pros & Cons
The Risk of For Sale By Owner and Discount Brokerages
Virtually every person selling real estate stands to gain anywhere from tens of thousand of dollars to several hundred thousand dollars. Homeowners don't realize how much of a risk they are taking when they use a discount brokerage or sell their home on their own. Imagine a scenario where you sell your home on your own, and 3 years later the people who bought your home find mold inside one of the walls during a remodel. Can you be held liable?
What sort of precautions should you take if you are buying your home? Should you be using a real estate professional?
- The risk of For Sale By Owner
Many people do not understand the risks when they sell their home on their own. They do not understand that if they do not make all the proper disclosures, and provide all of the proper documentation, they could be liable for damages in the future long after the sale of their home is completed.
- What Happens If
What happens if you didn't disclose something properly? What if the person that buys your home finds mold growing inside a wall and you never even knew about it? What happens if you did not provide your buyer with a proper zone disclosure report? What happens if there is a documentation error in your escrow? What happens if your buyer does not perform? Many Sellers do not consider these factors when selling their home. They only focus on saving a few dollars on commission without realizing that they are risking hundreds of thousands of dollars.
- Buyers Beware
Buyers should also be careful when they are purchasing a home. As a buyer you will be investing hundreds of thousands of dollars on your home. What would happen if you bought a home and a few years down the line you found out that there was an easement problem with the home. What would you do if there was a problem with the sewer line that ran out to the main line? Don't take chances!
- Discount Brokerage Risks
Many discount brokerages offer reduced services in order to save their clients money. However, their clients do not realize that they may be at risk when they work with these discount brokerages. For instance, forsalebyowner.com recommends that their clients hire a real estate attorney to reduce their liability for any real estate transaction. So in the long run, you don't pay much commission but you end up paying high legal fees.