Are the homes for sale by owner a good deal? Many buyers looking for cheap homes think they can find better deal going direct with owner, but the reality is different:
When a home owner sell his home direct the only motive is try to save the real estate commission he need to pay for put his home in the market, but this saving are just for him not for the buyer. In my experience, most of the time homes for sale by owner have the highest prices in the market, because the owner just ask the price they believe his home worth (80% of the time is high). Some other owner are just trying to avoid disclose important information like encroachments, lien, and many more adverse facts affecting the property.
Most of the homes for sale by owner are not financed by them, many buyer have the idea the owner go to take any down payment they have and finance the rest of the money and this is not true, the owner when are selling their homes are expecting have all the money in cash or the buyer by financed by a bank.
In short, most of the buyer, getting homes for sale by owner doesn’t get any super deal and they need to hire an attorney to get advice (pay by them) or buy a property and discover late innumerable issues and pay the consequences. Let me show you some real cases from people how call me to try to find a solution.
I receive a call, is somebody how bought a home for sale by owner some years ago, he just receive a notification from the IRS, this notification read he need to pay $40,000 in taxes or he go to lose the property he bought, he respond to the IRS that he is current with his Taxes, but the IRS reply that the former owner of the house is who own this money and they put a lien over this home. He makes the mistake buying a home and the owner lie and never tell him about this IRS lien. At the end, he loses the house and all the money he pay for that house.
One person call me, they have 2 year fighting with the neighbor because he is arguing the part of the building is over his property, this person bought a home for sale by owner and he never realize about the property have an encroachment, at the end he lose the lawsuit and have to pay several thousand to fix the problem. We have a very close case of encroachment with one of my buyer, but our survey team together with our attorney discovers the problem on time and they resolve it at no cost for my client in less 5 days.
One client was looking for homes financed by the owner, at the end they just disappear and some years late they call me, They bought a “super deal” a home for sale by owner and financed by the owner too, what they don’t know was this owner can’t sell and finance the home because he have a mortgage and the bank don’t allow just pass the note to somebody else. Seller only collects all the money they could get from the buyer and t go away (in fact, seller was losing the home when they sold it and buyer supposes to take over the payments). At the end the bank asks to the buyer pay in full the loan, also the buyer discover the house continue under the name of the former seller because they never register the sale in the court. The sale of this house was illegal and buyer loses the house an all the money gives to the owner.