Dear Mr. FSBO, is your buyer qualified to buy???

By
Real Estate Agent with RE/MAX Shoreline New Hampshire & Maine

OK, so you bought a $4.95 sign at Wal-Mart, stuck it in the front yard, and right away the nicest young couple stop by and say your house is perfect for them.

"We want to buy it", they say.

"Wow, that was easy", you're no doubt thinking. You get out your Office Depot contract form, you all sign it, and now all you have to do is wait for the check to get here.

A couple of weeks later your 'buyers' strangely become incommunicado after numerous trips to your house to measure for new blinds, show it to friends and relatives, and talking about what they're going to do after.....................

Could trouble be brewing on the horizon???

Chapter IV of my "Knoxville FSBO Handbook" covers this situation and how to prevent it.

In case you missed them here's Chapters I, II & III.

Chapter I

Chapter II

Chapter III

Posted by

Jim Lee , REALTOR®, Certified Residential Specialist (CRS)

http://JimLee.com  RE/MAX Shoreline

100 Market St., Suite #200, , Portsmouth, NH 03801 Phone: (603) 431-1111 x3801

Visit New Hampshire Maine Real Estate.com to search homes, get Seacoast area information, and find out how great living on the New Hampshire and southern Maine Seacoast really is.

 

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Anonymous
Janet Jurich

 I love the handbook idea.  Did you write it?  How do you use the info to get to FSBO..Postcard campaign, website?

Dec 20, 2006 06:02 AM #8
Rainmaker
1,208,017
Jeff Turner
RealSatisfied - Santa Clarita, CA
Just one of the many reasons why I wouldn't sell a house without the assistance of a real estate agent. Jim, you have some great content on your blog. 
Dec 20, 2006 06:34 AM #9
Ambassador
4,069,644
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude
Good information, Jim. I recently wrote a series on the FBSO and a major issue is determining IF someone is qualified, and then dealing with the transaction itself. I doubt most know how to do this (thanks for your link) nor are they even thinking about the ramificationsif the buyer is NOT qualified. In my FBSO First Aid Kit I suggested that all FSBOs have a qualified mortgage professional on their team to help with determing pre-approval of any buyers, among other financial matters. Could be ugly stuff for the naive FBSO.
Dec 20, 2006 06:37 AM #10
Rainer
119,762
Sean Carroll
The Get Off Your A$$ Academy - Manhattan, NY
Real Estate Speaker and "Expert" Coach
This is a great post. I have incorporated a dialogue like this into my presentation when I meet with a FSBO. I've found the toughest thing is just getting in the door.
Dec 20, 2006 07:09 AM #11
Rainmaker
600,292
Jim Lee
RE/MAX Shoreline - Portsmouth, NH
Portsmouth NH Realtor, Portsmouth, NH

Janet, the handbook is a work in progress and is just sections on my blog now.

Thanks for the compliment Jeff.

Sean I've found you don't really need a dialogue for FSBOs what you need is persistance. Most of them will list with someone eventually, you just need to keep in touch until then. Offer to do things for them; make a picture, set up a flyer and e mail it to them; most of their material looks pretty amateurish.

Dec 20, 2006 07:49 AM #12
Rainer
340,092
Ken Smith
Suburban House Hunters - Arlington Heights, IL

Sold a home not to long ago that had been "under contract" 12 times. The sellers had even gotten pre-approval letters from the buyers, but they still kept falling apart. We got it sold before even listing it and got them $18k more then they had been trying to get fsbo AFTER commissions.

The poor sellers had been so emotionally drained at this point they wouldn't believe it was sold until they walked out of the title comapny with their check. Was very happy to help them and they have told many of their friends and family about there "By Owner" experience in there holiday newsletter and gave me a amazing referral.

Dec 20, 2006 07:56 AM #13
Rainmaker
3,054,229
Tony and Suzanne Marriott, Associate Brokers
Haven Express @ Keller Williams Arizona Realty - Scottsdale, AZ
Serving Scottsdale, Phoenix and Maricopa County AZ
Jim - Great stuff on the FSBO book - is it copyrighted to you - or is it OK to excerpt with attribution and link back to your site?  Tony in Arizona.
Dec 20, 2006 08:28 AM #14
Rainmaker
600,292
Jim Lee
RE/MAX Shoreline - Portsmouth, NH
Portsmouth NH Realtor, Portsmouth, NH

I'm flattered Tony, of course you may use it. I will appreciate a linkback.

Thank you very much,

Jim

Dec 20, 2006 08:38 AM #15
Rainmaker
520,360
Tom Burris
NMLS# 335055 - Baton Rouge, LA
Texas/Louisiana Mortgage Pro - 13 YRS Experience

i deal with quite a few fsbo deals each year.

there always seems to be little problems.

i stress to my clients that i am NOT a realtor.... and try to stay out of it.... but it seems like i am always correcting contracts.

maybe there needs to be a surgeons general warning on the fsbo kit

 

Dec 20, 2006 10:51 AM #16
Rainer
160,787
Stefan Scholl
Buyer's Broker of Northern Michigan, LLC - Petoskey, MI
Northern Michigan Real Estate
Good advice, Jim.  Any nibbles on your offer to post FSBOs on KnoxvilleMLS.com?
Dec 20, 2006 11:33 AM #17
Rainer
9,762
Brian Brass
Brian Brass - Guaranteed Rate - Troy, MI

Let me start by saying that I'm a mortgage banker who reaches out to FSBO'S... 

A greater challenge than Pre-Approval/Mortgage Commitment is the contract.
Most FSBO's have no clue about disclosures or other contractual obligations.

Sorry to say many Realtors also do not understand the difference between:
Pre-Qualification (Broker), Pre-Approval (Lender) and Mortgage Commitment. 

I send about 1 in 4 FSBO contacts to a local Realtor after explaining the challenges.
I have a section on my personal website entitled "FSBO Pitfalls" to help educate.

But as long as someone thinks they can save a few bucks...

 

Dec 20, 2006 12:18 PM #18
Rainmaker
3,054,229
Tony and Suzanne Marriott, Associate Brokers
Haven Express @ Keller Williams Arizona Realty - Scottsdale, AZ
Serving Scottsdale, Phoenix and Maricopa County AZ
Jim - Thanks for you being so gracious - much appreciated!  There will be several links back to you.  Happy Holidays!  Tony
Dec 20, 2006 12:23 PM #19
Rainmaker
600,292
Jim Lee
RE/MAX Shoreline - Portsmouth, NH
Portsmouth NH Realtor, Portsmouth, NH

Stefan that FSBO offer is good for 1-4 listings a year. Every now and then one of them lucks out and sells their own house but the cost to me is almost nothing to put them up there.

I've also sold a few from the ads.

Dec 20, 2006 12:26 PM #20
Rainer
67,067
Lauren Corna
Archway Realty, LLC - Southlake, TX
Broker
I really like your FSBO Handbook !!  I might implement some of your ideas into my marketing strategies because my current one sure hasn't worked...
Dec 20, 2006 12:42 PM #21
Anonymous
David Love
Here in California, we have Invasion Robberies. Crooks make contact with unsuspecting homeowners as door to door sales, free inspection, etc. FSBO's are a likely target with easy access. They come back later in a gang, kick in the door, whether the homeowner is there or not, clean it out and sometimes beat the homeowner. That's alot worse than the deal falling apart. I don't try to scare them into listing, but facts are facts.
Dec 20, 2006 01:45 PM #22
Rainmaker
151,696
Harper Team
J Rockcliff Realtors - San Ramon, CA
Jim - looked over the previous chapters and your site - good info - mind if I adapt some of it?
Dec 20, 2006 03:33 PM #23
Rainmaker
600,292
Jim Lee
RE/MAX Shoreline - Portsmouth, NH
Portsmouth NH Realtor, Portsmouth, NH

Please adapt away.

 

Dec 20, 2006 04:03 PM #24
Rainmaker
402,954
Suzanne Marriott
Keller Williams Arizona Realty - Anthem, AZ
Associate Broker, CLHMS, e-PRO
Jim - Tony pointed out this post to me - great content.  We have been doing something similar for FSBOs the last couple of months that has resulted in a listing - so I think there is merit in this approach.
Dec 21, 2006 01:23 AM #25
Rainer
100,192
Kaushik Sirkar
Call Realty, Inc. - Chandler, AZ
This is great.  The key is to be able to have a dialogue with the FSBO.  If you can have the dialogue and educate them, then you are all but in.  The proverbial foot in the door....
Dec 21, 2006 11:34 AM #26
Rainmaker
114,594
Ken Spencer
Serendra Realty Group - Buckeye, AZ
for Verrado, Buckeye, Sundance

Your posts are right on.    I also love FSBOs.  I'm new to the business (1 year) but have so much fun stopping at a house with that red and white sign outside the door.  It's all about relationship building.  Do I get some rejection when I knock on that door? you bet.  Do I take it personally? Absolutely not.  They want to sell so badly and I find if I develop that relationship with them, I will be the person they will come to when they find they need some help.  I love it.  Your posts tell it all.  I love reading them.

 

Ken

Dec 21, 2006 12:12 PM #27
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Jim Lee

Portsmouth NH Realtor, Portsmouth, NH
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