how do i know whether this FSBO is serious?

Asked by Mark Twain, Burbank, CA Tue Feb 16, 2010

i put in an offer on an FSBO; the home has been on the market only a few weeks. sellers are 3 sisters who seem to be disorganized and have never done FSBO before. this was their parents' home (estate sale). we have not heard a peep from them (it's been 24 hours). is there anything i can do other than wait this out? what if they miss the 48-hour deadline to respond to the offer? btw, offer is only 30k below asking, but we are willing to go to asking price and perhaps above it. i guess i am frantic because we finally found our dream home and unfortunately, it's an FSBO.

we don't have a buyers agent involved yet because we wanted to put an offer in right away and we did not want to wait to find an agent, and then have them put in the offer.

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20
Tommy Lee, , 91502
Sat Feb 27, 2010
Mark
Asking a seller to fix a problem is not out of the question. If it were a bank (REO) they would probably laugh at you. But with private sales it usually is acceptable to ask for non-cosmetic repairs. But just be aware they may say "as is" in the agreement. That will add another level of negotiating.

It is normal for anyone to keep a for sale sign on the property just in case it falls out of escrow. Good real estate professionals know that things fall out of escrow all the time. So a good agent will keep the sign there for as long as possible. It is also advertising to keep our name in the public's eye.

One thing to remember, if they get a better offer while you are asking for this 4k credit, they may say no and try to go with the other offer. Just a thought.


Tommy Lee
323-821-2292
tommy.lee@dilbeck.com
1 vote
Tommy Lee, , 91502
Wed Feb 17, 2010
Hi Mark,
Looks like agents from all over have been trying to help. Many of their comments are on track. I even liked how Mr. Sanchez posed a series of questions. One thing I think is missing from this equation. The sisters mentioned in your original post seem to be unsure of what they are doing. This might especially be the case if the estate is a probate. Probate cases take on a whole different process than if the estate were a trust, especially if they need court confirmation.

Even if your current agent, due to his illness, is unable to help you, I would strongly recommend using an agent. The cost to you for the agent's services may be a small price to pay in order to get the house and to avoid any problems. I am not sure if you are aware but sellers typically pay the commission of 6% to be split by both agents. In a FSBO the seller's will typically offer commission to the buyer's agent but save the cost of paying a commission to their own listing agent. So the savings are about 3% of selling price. In rare cases they seller's will not cooperate with a buyer's agent and so the buyer has to pay his agent.

Additionally, a good buyers agent can write up the purchase agreement forms online and email them to you within half an hour. So, time delays in getting the forms should not be a problem for a capable agent.

I have an office on Glenoaks and you can call or email me anytime.

Tommy Lee
Dilbeck GMAC Real Estate
303 N. Glenoaks Blvd. Ste. L-110
Burbank, CA 91502
(323) 821-2292 cell
tommy.lee@dilbeck.com
1 vote
John Juarez, Agent, Fremont, CA
Tue Feb 16, 2010
I thought that you might find this information that I have cut and pasted from a Wikipedia citation to be amusing:

• Mark Twain: on two occasions the writer was incorrectly feared dead. Though only the second case counts as a premature obituary, the first is often erroneously cited as the most famous case:
1. In 1897 a journalist was sent to enquire after Twain's health, thinking he was near to death; in fact it was his cousin who was very ill. Though (contrary to popular belief) no obituary was published, Twain recounted the event in the New York Journal of 2 June 1897, including his famous words "The report of my death is an exaggeration" (which is usually misquoted, e.g. as "The rumors of my death have been greatly exaggerated", or "Reports of my death are greatly exaggerated").
2. On 4 May 1907, when people lost track of a yacht he was travelling on, the New York Times published an article saying he might have been lost at sea. In fact, the yacht had been held up by fog, and Twain had disembarked. Twain read the article, and cleared up the story by writing a humorous account in the New York Times the following day.
1 vote
Don Tepper, Agent, Burke, VA
Tue Feb 16, 2010
Staying in contact with them, done properly, doesn't indicate desperation. And remaining silent, especially when they've been surprised at the "calls and interest," is a pretty good way to have your offer ignored. Whether those other calls pan out is anyone's guess. At least they've got a solid offer from you. It's your job to regularly remind them of that and to determine the status of your offer.

Look. They may be flaky. And they're inexperienced. Plus, I'm sure the 3 sisters have different priorities, even if each is willing to sell. One may want a higher price. One may just want to sell quickly.

Regarding the 48 hour deadline: That was reasonable on your part. But you made a critical error when you assumed that they weren't serious about making a decision that quickly. (I'd still have kept a 48-72 hour deadline, just so they couldn't shop your offer around.) They, in turn, probably assumed you were trying to pressure them into a deal. If they'd had an agent (or if you had), it could have been explained to them that such a deadline is reasonable.

All that's hindsight. So, find an agent to represent you. Listen to that agent's advice.

Good luck.
1 vote
Mark Twain, Home Buyer, Burbank, CA
Sat Feb 27, 2010
thanks everyone for your help! well, she got back to us right under the deadline and, after some countering, we are under contract! now we have to get through the inspection negotiation; we had the inspection this week and we have faxed them with the repairs we are asking for ($4,000 plus in roof leaks, electrical problems, and severe carpenter ant damage in the garage), but have not heard anything back. i will keep you posted. they may be in shock about the cost, but everything we are asking for is safety related or structural; nothing is cosmetic, etc. they probably had no idea their parents' home had these hidden problems. but what are we supposed to do? i believe these are major problems they should fix; am i wrong?

by the way, don't you think its weird for them to still have the FSBO sign up on the property?
0 votes
James Deskins, Agent, Worthington, OH
Wed Feb 17, 2010
Simple: most FISBO's are NOT serious. Don't believe me? Most FISBO's end up listing in the end because they can't/won't sell as a FISBO. Many FISBO's are just testing the waters. The are serious about trying to save money but most of them don't know what they are doing. Sorry, that's a fact.

One easy way to tell is how it's priced. If it's over the market value for that area they're probably not serious. Most FISBO's are initially over-priced.

Also, do they have an attorney helping them? That, to me, would be an indication that they are headed in the right direction.

And if they don't respond by the deadline that also might indicate that they are not serious.

Question: if you don't have a Realtor how do you know your offer of "30K below asking price" is a good offer? How do you know what it's worth? I ask this because many times when there is a transaction without a Realtor on either side neither party truly knows what the house is worth. I hope you did your homework because if not you may be overpaying already. I've seen cases like this where the buyer got shafted in more ways than one.

Good luck.
0 votes
Alan May, Agent, Evanston, IL
Wed Feb 17, 2010
They probably think that the "oh, you're going to have to give us more than 48 hours" carries some weight.

Okay, it's now been more than 48 hours. What's happened? Have they gotten back to you? Did you call them? What's up!?
0 votes
Harold Sharpe, Agent, LAKE HAVASU CITY, AZ
Tue Feb 16, 2010
Hi Mark,
Rule number one of an offer,
have a qualifed representative represent you so you look professional and they take you seriously;
I sure am curious as to how you made the offer and on what paperwork.
Rule number two of an offer.
If you give them 48 hours to answer wait 50 hours.

Harold Sharpe
So Cal Homes Realty
(951) 821-8211

http://www.socalhomesrealestate.com
0 votes
Ludwig Parsa…, Agent, Burbank, CA
Tue Feb 16, 2010
Hi Mark,

Let us be straightforward, sellers are trying to save money, you are trying to save money. Now you have this situation. Lawyers doing their jobs, Doctors doing theirs, and we are doing our job. I have many lawyer friends, trust me highly paid ones, specialized in their areas, but always looking for my help and assistance in residential or commercial real estate services, not because there are not knowledgeable, or so, but because they are doing their job, fully busy and lot of practical nuances they don’t know, of course if they are not real estate attorneys.
See, I am not talking about agreements, but about practical knowledge, and as you see your questions are based on lack of experience and practical knowledge. And agent service is free for you, because seller pays for buyer’s agent as well. Why not to use the agent service? There is only one reason, which is most probably not working well, and you did it.

Trust me, the agents posted their answers here are experienced ones and can write a book about all practical nuances, negotiation strategies and tactics in real estate. It takes time, intensive training and hundreds of closed sales.

Your offer is only 30K below asking, but you are willing to go to asking price and perhaps above it. Why you didn’t give them the full price in the first place? I am sure spending two years looking for the “perfect home” is more expensive than $30K. FSBO is a very sensitive area and they put their maximum turning point with it. You should give them the full price and based on my experience probably would get your acceptance in 24 hours or less. But now, you opened a lot of doors for negotiations, with your and other offers, now there are relaxed and have more time to play the “game” and don’t forget about your competition in Burbank. I am a local agent and as you know there is not much supply outside (even though banks are keeping the houses artificially on their balance sheets. That’s a story itself.)

In CA the seller doesn’t need to officially reject an offer, if not accepting. If there is a listing agent involved at minimum they can do is send the buyer’s agent an email or yet alone give them a courtesy phone call. That’s all.

Should you need any assistance or help, feel free to call me anytime at (818) 281-5889 directly or to any good agent in Burbank area.

Good Luck.
Respectfully,
0 votes
James Sanchez, Agent, Burbank, CA
Tue Feb 16, 2010
Hey Mark,

You have a lot of things going on here, 3 sisters confused on what to do and 1 took control and listed the property according to what they thought. But now the neighbors, family, friends are probably asking them why are you selling the house so cheap? So now they are confused about what to do. ( You did mention that this was the cheapest house in the nicest area). Did you get this information off of Zillow? There is more to the value of a property or why a house sells for a certain price. You cannot go by dollars and square foot for value. Do they / you have an escrow company to use? How about a title company? These come into play when buying a property. The 48 hour dead line, that is a timeline for them to respond to you. But let’s say it takes them a week and out of nowhere they call you saying do you still want to buy the house? As long as both of you agree the original contract is still good and you would go off of that unless you make changes to it then you would add those changes (counter offer/ Addendum). You have to call them and ask them, do you have any offers? How quickly do you want to sell (30 days, 40 days)? What they thought of your offer? Did you send a letter how you are pre approved and naming the bank? Did you send a nice letter saying this is a "dream home " for you and how you have been looking for 2 yrs and have not found anything? This is their family's home they are not just going to jump up and move out, this home has value (not money) and meaning to them. You say you are $30k less then asking but why would you do this if the home is already the lowest price and this is a home you have been looking for? These are not desperate sellers that have to sell right away. The home probably has plenty of equity (did you check?) and they are going to sell it for something reasonable.

You have to have patience but yet have determination. You can't sit back and wait for them or the next buyer (or Realtor) might just come along sweet talk them and take the deal.

Best luck to you, my office is in Burbank and I answer my phone all the time.

James Sanchez
Broker / Realtor
818-504-2569
Pacifix Realty
3500 W. Olive 3rd floor
Burbank CA 91505
0 votes
Dorene Slavi…, Agent, Torrance, CA
Tue Feb 16, 2010
Dear Mr. Twain,
Well,that is a very good question. The best thing to do is to get a buyer agent on board...but..that might be difficult at this stage in the game.
I have seen FSBO sellers change their minds and make the decision to keep the house, which causes frustration for all involved. If you lose this property..do yourself a favor and retain an excellent buyer agent..you will be glad you did!
Web Reference:  http://www.doreneslavitz.com
0 votes
Monique & Joe…, Agent, Beverly Hills, CA
Tue Feb 16, 2010
Hello Mark,

FSBO's can be a good deal but many of them (seller's don't know the paperwork and sales process). I'd be happy to represent you on this purchase but since it is a FSBO they probably won't pay a commission. In this case the buyer would have to pay it.
The sales process can be complicated. You are already experiencing the issues associated with buying from a FSBO. Being it is a trust there is also the issue of if you get clear title and if there are any heirs involved. I think this one might be a pass unless you have representation. Don't risk it. A home is a major purchase and if they aren't even responding to your offer than it might be a good idea to move on or have someone assist you in the purchase.

Best,

Monique Carrabba
The Carrabba Group
Keller Williams Hollywood Hills
mcarrabba@kw.com
(323) 899-2900
0 votes
Patrick Thies, Agent, Anytown, IL
Tue Feb 16, 2010
sellers are 3 sisters who seem to be disorganized and have never done FSBO before. this was their parents' home (estate sale).
_________________________________________

Mark,

This usually says it all right here. You are dealing with multiple opinions here and emotions. It's hard for siblings to agree right away what the best thing to do is. Sometimes one or two of them are still too emotionally attached to the home and are in no hurry to sell or move on. (This is not always the case but does happen quite often).

I think that since you are doing this on your own, it would be ok for you to call and touch base with them. Say something such as "We just wanted to touch base and see if you had a response for us..." or something to that effect. Good Luck
0 votes
Debra (Debbi…, Agent, Livingston, NJ
Tue Feb 16, 2010
" flaky, emotional owners who may or may not be serious, who may drag their feet, etc. i think we are def. gonna need an agent pronto"
................................
Mark - yes....they are definitely emotional...they did suffer a loss, and have become "sellers' without planning to be sellers. They have a lot to figure out, and all 3 have to agree. Do you know if the estate is in order and has been probated? They may not even be able to sell the home yet............that's why someone has to take the lead here.

Find an agent......we agree on that!!

As far as speaking with them........well.......you already have..............Personally, I would, in a relaxed manner, let them know you are very interested (no need to play coy), that you understand this is overwhelming and confusing for them...........and that you will have representation shortly. Maybe they will respond to your offer at that time, maybe they won't .

As far as an offer date expiring, I can't answer to that, as in my area we don't give specific timelines, unless something drags on indefinitely. I think you need to be a bit flexible with them, as they obviously don't know how to respond, either.

Once you get an agent.........let your agent guide you.

Best wishes...............here's hoping it works out!
0 votes
Mark Twain, Home Buyer, Burbank, CA
Tue Feb 16, 2010
hi all thanks so much for the quick replies.

i did have a buyers agent at one point but he was diagnosed with cancer and is ill and now not working; we did not have time to interview and find other agent(s) before we saw this FSBO and pounced on it. the FSBO is a fixer upper in a very desirable neighborhood (cheapest house on a pricey block etc.). i think these people may wanna hold out for more money and maybe that's why they are taking their time; they claim to be shocked at the calls/interest in the home. there's also the aforementioned family/estate sale dynamic.

i completely agree that if we had an agent i would not even be typing right now. he'd be constantly updating us on what's going on with the other side, etc. i can tell you that when we gave them the offer one of the sisters was like "oh yeah you're gonna have to give us more than 48 hours to figure it all out". but i didn't think she was serious; do these people not know that offers have strict deadlines?

i guess we will wait for the deadline, and then decide what to do. btw we are pre-approved buyers with 30% down and we have all of our ducks in a row; we submitted a residential sale contract w/ contingencies for inspections, etc. and are ready with 10k deposit, etc. it's the FSBO sellers who don't. this is killing me because after 2 years of looking, the "perfect house" is a FSBO with flaky, emotional owners who may or may not be serious, who may drag their feet, etc. i think we are def. gonna need an agent pronto. thank god for realtors! i guess if i really want this house we are gonna have to work with them.

question: some of you said we should keep in contact with them, and this is the focus of my questions; i thought we should not show interest whatsoever so they don't think we are desperate????? we were going to keep NO contact and see if the offer expires. i would have thought that by now they would have called and said we are reviewing the offer, we will get back to you by XXXX, etc. but then again thats what the agents are for!
0 votes
Matthew Bart…, Agent, Glendora, CA
Tue Feb 16, 2010
Hi Mark,

I would recommend that you keep in close contact with the home owners. Being that this is their first time selling a home as FSBO they are going through a learning process. I recommend that if the offer expires before they respond you resubmit a new offer, However, make sure that next time you use an agent when resubmitting the offer. There are far to many important details that must be handeled properly when selling Real Estate. Now is not the time to try and save a few dollars when a mistake could cost you much more in the long run. Good luck!

Matt
0 votes
Debra (Debbi…, Agent, Livingston, NJ
Tue Feb 16, 2010
Well Mark - you are a prime example of the pitfalls of not having a professional handle this....on both sides of the transaction, as, understandably, no one knows what they are doing (no offense meant - just an observation based on what you shared).

First................let's start with assuming you are qualified to buy this home.........that means I hope you have already spoken to a mortgage rep. If not.lspeak to one immediately!

Now.......you are already in this situation, so you have to make the best of it.
This is further complicated by the fact that it is an estate sale, and there are 3 sisters all adding their opinions to the mix. There is no leader or anyone to guide them.

So.what now?
You say you don't have a buyer's agent "yet"................well, now's the time to find someone - and quickly!

You need to call the sellers and let them know you plan to have representation....since you already jumped in wth an offer of some sort.........you need to prepare them for the next step. Let them know this will be helpful to all invovled, as a Realtor can help organize and direct the steps necessary to bring this to a resolution.

Then..................find an agent .....fast..........have them prepare a market analysis for you, so you can really determine the market value of the home. You say you're willing to pay full asking price, but make sure it's worth that!.
At that point, agent in hand, comps in hand, you will be better prepared to have your offer presented. Right not, you are all flying blindly...............

To summarize - find an agent.......inform the sellers......make sure you're approved for the purchase..........if you decide to proceed solo.....at the very least, call in an attorney for help.

Take a deep breath...........and gather the necessary information and support you need!

Best wishes...let us know how it turns out!
Debbie Rose
Prudential NJ Properties
0 votes
Brian McMurr…, Agent, Tawas City, MI
Tue Feb 16, 2010
Most Sellers are Serious about Selling. Note that 24 hrs is not a long time - especially with 3 sellers involved in the process. Best of luck on pursuing your dream home.
0 votes
Alan May, Agent, Evanston, IL
Tue Feb 16, 2010
If you gave them 48 hours to respond... you're jumping the gun a little... give them the rest of the 48 hours.

If they miss your 48 hour deadline, then you have to decide if you want to extend it, or call their bluff.

You've also given an awful lot of information out, just in case one of the three sisters is "internet savvy", in the Tampa Florida area... they now know that you're willing to pay full price.
0 votes
Scott Godzyk, Agent, Manchester, NH
Tue Feb 16, 2010
A buyers offer certainly could assist you with a fsbo and would have been able to asist you with the offer and eliminate the things you are facing. First of all your offer should never be base don an asking price, you need a broker price oppinion or appraisal telling you what market value is, and base your offer on that. If you wrote in this offer expires in 48 hours and they dont answer, it expires, they may be hoping for another offer and hanging onto you as a last option. With no one to guide them, they are shooting in teh dark and may not know they can counter you or what to do next. You need to be constantly contacting them for updates.... Good luck with working things out
Web Reference:  http://www.ScottSellsNH.com
0 votes
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