By Mary Anne Been
We’re sure you’re wondering what a FSBO is. It’s pronounced “Fizz-Bo,” and it’s an acronym meaning “For Sale By Owner.” You’re also probably wondering what the heck FOMO is. It’s an acronym meaning “Fear of Missing Out.”
Now, you’re probably wondering what one has to do with the other. Let us explain what it means to sell your home as a FSBO, and if you do, why you’ll definitely have FOMO.
Selling as a FSBO is all well and good, and you’ll certainly save lots of money on commissions paid out to brokers; well at least you think your saving. You’re actually EARNING your commission just like a Realtor would. It is important that as a FSBO you understand the difference between earning and saving or making money off your sale. Let us get down to brass tacks with FSBO vs. Realtor –
1. FSBOs don’t always price their home to sell. The home gets priced to go on the market, plain and simple. The price is usually based on a number of factors that are not necessarily accurate: maybe an FSBO saw what a neighbor fetched for their home, or perhaps one of the discount online brokerages gave a computer-generated value that doesn’t reflect the actual value of the home, or worse, some third uncle’s cousin is a real estate agent five states over and yammered on at Thanksgiving dinner about how much the home was worth.
As a part of their service, Realtors provide much more in-depth, accurate estimates when valuing a property listing to sell. Realtors take many different factors into account. How is the market is behaving? What time of year is it? What does the current inventory look like? How does the comparable market shape up? The list goes on. A realtor’s job is to ensure that their client’s property is going to get the best possible price from a buyer. Many times a Realtor’s expertise in pricing and negotiating before and during the transaction will make the seller MORE money than their anticipated savings as a FSBO.
2. Shortly after listing a property, the FSBO can and assuredly will feel extreme frustration with the amount of phone calls they’ll have to field from the public, in addition to aggressive realtors wanting to see the property with their buyers, no matter the hour of the day. It can be overwhelming, to say the least.
A Realtor’s job is simple: take that headache away. Field those calls for the seller, then authoritatively act on each inquiry as needed, coordinating with the seller’s schedule and needs.
3. Many FSBOs aren’t entirely sure what they are doing, paperwork-wise. There are incredible amounts of legal documents that require signatures and negotiations between buyer and seller within specific timeframes, and if an FSBO is not versed in such matters, it can be overwhelming. Soon enough, they’ll be wondering why they didn’t let a professional handle it. Can they hire someone to oversee their paperwork? Sure, but then there goes more of their perceived savings to pay an outside person to read and process the paperwork for their transaction.
Realtors are educated in the paper chase. Many Realtors have a licensed Transaction Coordinator and team who work behind the scenes, handling all the timeframes and paperwork harmoniously with the listing agent and buyer’s agent. Usually, the seller breezes through the transaction with little to do.
4. Escrow is the third-party intermediary who holds funds, and who processes paperwork between the buyer, lender, and the title company. They are the I-dotters and T-crossers for the entire transaction. FSBOs don’t always realize the amount of communication that goes on between the Listing Agent and escrow, in terms of document exchange during a transaction. There can be a lot of back and forth in the process. Additional documents and miscellaneous paperwork may have to be created in order to satisfy a contract agreement between buyer and seller.
Realtors and their teams understand how and when to create such documentation to ensure the seller is protected from any financial damages or legal action that may come up after the close of escrow. Realtors are bound by their fiduciary duty to their client the minute the listing agreement is signed.
Many times a FSBO does not realize the fiduciary or legal implications if for some reason their contract fulfillment is not satisfied by close of escrow. Realtors are insured for such situations and that insurance protects them and their clients. Leaving one asking, why even take that chance at all. Hire a Realtor.
5. Then, there are the details. With every real estate transaction, there are finite details that can have the potential to create issues if not addressed properly. FSBOs can be unaware, or simply forget, that certain steps need to happen before, during, and after a transaction. For example, did you know that when a buyer takes possession of their new home, it needs to be free of rubbish? Did you know that the home has to be in the same working order it was last seen by the buyer? It’s surprising how many times a home is turned over to a buyer with trash and items left behind, as if some magical room service was coming in to clean up before the new owners take possession of the property.
Realtors take the time to make sure all those little details are taken care of before they are noticed, and certainly well before they become an issue.
6. Finally, there’s the support – As we’re sure you are quickly realizing, selling a home as a FSBO can be quite a lot of work, and an extremely stressful process. Having a Realtor by your side provides not only a comfort level of knowing everything will be managed in your best interest, but that a realtor is your rock – the person you call when there might be an issue, or even as a sounding board to bounce around thoughts and ideas. And when all is said and done – escrow has closed and everyone is happy – a life long friend.
Having a Realtor sell your property is a service that provides the following:
• Provides an unparalleled skill set of pricing and negotiating to make their seller the most money possible off the sale of their property.
• Gives perspective. A Realtor helps the seller see the forest through the trees when it comes to knowing what could be an issue and what is not.
• Alleviates the headache of fielding tons of phone calls and texts from other realtors and their potential buyers to schedules showings.
• Ensures that the seller is protected legally to the best of their abilities.
• Saves the seller time by dealing with escrow and handling paperwork correctly.
• Realtors give assurances that the transaction is going to close and addresses buyer issues if any.
• Can handle more than one transaction at a time… are you moving to another home? I’m sure your realtor is helping you with all that at the same time as well. Who wants to do 2 escrows alone? Only a Realtor and their team.
• A Realtor’s marketing skills go beyond just Facebook and the MLS. Realtors have an extended network of buyers. Their marketing tactics guarantee as many people see the seller’s property as possible to bring in the highest and best price.
• Spend their time fielding phone calls and texts to coordinate showings while trying to work and live their everyday lives.
• Have to negotiate sale price and terms before and during the transaction. (This in itself can be the proverbial straw that breaks the camel’s back).
• Have to work with escrow almost daily on the phone and over email to coordinate paperwork.
• Enduring more stress, handling paperwork alone with no insurance or assurances.
• Are limited when it comes to marketing their property.
• And honestly, needing many more strong beverages at day’s end while having massive amounts of FOMO over other folks who hired an agent and are reaping the rewards and benefits.
Hiring a Realtor alleviates needing to have to worry about too much. Sure, there will be time taken, and there will be a certain level of stress that would come with any large financial transaction, but the Realtor/rock/friend/shoulder to cry on is always there for you – day or night, sleet or snow, sun or rain.
It’s our pleasure and our duty. Call us to list your house today and sleep well.
Your Realtors of Choice,
Mike and Mary Anne
818-612-5145 | 818-266-9766