5 Biggest Mistakes Made By FSBO's and How To Avoid Them

1. Allowing a Potential Buyer to String Them Along - Buyers can get very excited about a home when they see it for the first time. They may not be totally truthful when dealing directly with the Seller of a home. Make sure you have firm dates for the inspection period, signing of the purchase & sale agreement (P&S), and financing period. Always get a mortgage pre-approval letter before accepting any offer.

2. Purchasing Another Home Without Positively Knowing That Their current Home is Going to Close - It is very important to put a contingency clause in any offer or P&S agreement that you sign. You do not want to be stuck either with having to buy another home without first selling yours, or having to sell your current home without having a new place to live.

3. Not Totally Understanding the Legal Aspects of a Contract - Read all documents thoroughly. Hire an attorney. I can't tell you how many times I have seen problems arise when someone tries to sell their home by themselves without consulting an attorney. At the very least, contact an experienced real estate agent. Though we are not attorneys and cannot offer any legal advice, we deal with these issues and contracts everyday and can tell you if something seems amiss.

4. What to Do With a Nit-Picker Home Inspection Report - Keep in mind that a buyer has the right to a professional home inspection. This can really turn into a nightmare if they choose an inspector who sets up camp in your house for the day. I have seen some of them spend up to 6 hours doing an inspection that should have taken 2 to 2½ hours. The outcome of such reports is usually not favorable towards the house and, in fact, may scare the buyer away. You need to be prepared to address any issues that come up. It is a good idea to spend the money to have an inspection on your home before you put it on the market. This way you will know what the issues will be beforehand, and can make any necessary repairs. 

5. Not Completely Understanding How Much Closing Cost Are - Buyers will often ask a seller to pay closing costs. If you don't specify a dollar amount you will be agreeing to pay all costs. There are some lenders who charge thousands more than others. You should contact the Buyer's lender to find out what the closing costs are going to be, and then agree with the buyer on specifically how much you are going to pay. Make sure this is placed in the P&S agreement. It should be worded as follows: "Seller to pay up to $3000.00 in Buyer's closing costs." One thing to keep in mind - if the buyer's closing cost are only $2500.00, then in most cases the Seller gets the extra $500.00.