Over the weekend, another agent in my office had posted a scenario that sounded all too familiar. The buyers had looked at several homes with the agent, including one that was for sale by owner. The buyers then went back to an open house at the FSBO, this time without their agent, and the for sale by owner convinced the buyers to dump their agent. The seller stated that the buyers could use their attorney and save $8000... Since the buyers really liked the house and it was listed at the top of their budget, they decided to write an offer alone.
Here is the problem:
1. The for sale by owner home is grossly over-priced and will likely not appraise even with the $8000.00 discount. Not to mention that on their listing and at the initial showing with the buyer's agent, the seller agreed to pay for the buyers' agent commission.
2. The buyer's financing is a USDA loan. First issue is that with the partial government shutdown, the financing cannot be done at the moment. Second issue, the property is not located in an area where this type of financing is available. Now, the buyer needs a co-signer and a down payment to purchase this specific home.
3. The buyer agreed to no inspections and accepted a pre-listing inspection completed by the seller over 2 years ago when they initially tried to sell with an agent. All because the seller stated that they were trying to help the buyers "save money" by not having to pay for their own inspections.
There are so many things that could possibly go wrong in this scenario. Even if it does appraise somehow, the buyer has to come up with down payment money and a co-signer. With no inspections, if there is anything of concern with the appraisal, the seller can refuse repairs. There is no representation for the buyers when initially the sellers stated they were willing to pay for the buyers to have their own representation when they first viewed the home with their agent. It wasn't until the buyers went back without their agent that the sellers convinced the buyers that they didn't need an agent at all.
Consider all of your options when you are looking at homes on the market whether they are listed with an agent or by owner. Ask your agent to show you the sold properties that are most similar to the homes that you choose so that you know if they are priced well for the features and neighborhood. A devoted real estate professional will protect your interests and solely represent you...your agent has no allegiance to the seller.
If you are thinking about purchasing a home in 2019, I would love to be your REALTOR. Let's sit down and talk about the process and what you are hoping to achieve!