For Sale By Owner: The Top Mistakes Home Sellers Make

I know, paying real estate commission is EXPENSIVE! Homes SEEM like they are selling themselves right now because they move so fast. You’re not a real estate agent, but you’ve sold the family car a time or two, how hard can it be right? Well, there is a lot to it, and a ton of laws to follow. However, in Tennessee it’s perfectly legal to sell your home yourself. Just make sure you don’t make these mistakes.

1. Not Advertising the price

Have you ever seen something you wanted to buy, but you couldn’t find how much it costs? Unless you REALLY, REALLY want it, you probably aren’t going to continue searching for the price. I don’t know about you, but price is a major factor in my level of interest. “Great!” You say, “This keeps out everyone that isn’t serious.” Well, honestly, they don’t know how serious they are until they find out if they can afford it. In the eyes of a buyer, it often seems like the seller is unrealistic with the price they are asking and don’t want to face the scrutiny from their friends and family on Facebook. Maybe you’re just private and don’t want people to know how much you’re selling your house for. In that case, your privacy may be better protected behind the wall of a good agent and their marketing. Either way, if you are serious about selling, you need to make it easier for people to buy it. That means advertising the price or at least making it EASILY accessible without calling, texting, or dm-ing someone they don’t know!

2. Terrible Photos

I know you aren’t a professional photographer, and neither are most agents. So, honestly, this one goes for agents as well (we’ve seen some terrible listing photos from them too). I know you hate when good photos make a home look better than it really is, but we have seen so many times where even us as agents have overlooked a home entirely which looked far and above better in person than in photos. Curiosity isn’t the best marketing strategy when it comes to not being for sure if a house is nice or not. It all looks familiar to you, but you’re representing your home to someone who has never seen it or been inside it. Using the right framing, gathering enough light, and showcasing the flow are key to good listing photos. Professional photos really make your home standout and gather as much interest as possible. Again, you don’t want to make a buyer work hard to see how gorgeous your home is. We love photographing houses, and often photograph homes for other agents. As part of our listing package, we offer our professional services in photo and video at no additional charge to you, if you decide not to go it alone.

3. Not being willing to work with buyer agents

This real estate market is HOTTTTT! If a buyer is serious, they are already working with an agent to help them stay on top of the market. Why wouldn’t they? They need to be able to focus on their careers and their families, not become a real estate agent. So many times, we see for sale by owners not being willing to work with buyer agents, which means, not offering them a fair commission to show a buyer your home and handle the paperwork. We respect someone trying to sell their home themselves, so we don’t hassle them, we just want our clients to be taken care of and get the home they want. Many times, we pretty much need to walk the seller through the process as well because they don’t know how, and they shouldn’t. That’s what the professionals are for. Being extremely guarded and difficult to work with however, is not going to be in your favor (that goes for you too agents). If you don’t want to list your home, that’s your call, but at least be willing to work with a buyer agent. If not, you will really narrow down your pool of buyers.

4. Expecting Top Dollar

No, I’m not one of those agents who is so arrogant to believe you don’t know what top dollar of your home is. I do have experience on my side and see how buyers and sellers alike respond to price points, homes, and neighborhoods. Let’s be real though, you CAN spend the time and take a deep dive into the data of the recently sold homes and probably come up with a pretty solid number, but, will you get it? There’s one thing we’ve seen from a for sale by owner situation that typically puts you, the seller, at a disadvantage. You and the buyer, usually aren’t on the same page with the whole, seller not paying commission thing. What do I mean? Well, you, the seller, decided to navigate the waters of selling your home yourself because you wanted to keep that extra money for yourself. Nothing wrong with that, right? Well, the buyer knows that, and for some reason, expects you to pass that savings along to them. How do I know that? I’ve literally had several people tell me they wanted to find a for sale by owner so they could get a “deal” because they KNOW the seller can come down since they aren’t paying commission. That’s the people I want to negotiate with lol. They target you, so they can get a DEAL. Hmm. You want more money, they want a deal. Idk how that works.

I know, plenty of people have sold their home themselves and no one died. Everything was just fine. There’s a lot to know, and once you agree on the price, there will be inspections, repair requests, and if they are using an FHA or VA loan, there will typically be minor repairs required by the appraiser in order to close the loan. It can be tricky to navigate. If you decide to list your home yourself, please don’t do the things above. We are here to help, even if you don’t use our services. However, we know how stressful it can be, we have made it our mission to make it easier for you, to take things off your plate, so you can focus on the other important parts of your life. If you need us, we are here!

Have questions or need us to list your home?

Check out our Sell Your Home Page or hit the call now button below!

How much money do I need down to buy a home?

If you think you need to have a lot of money saved up for a down payment before you buy a home, you’re wrong! Most people think you need a large 20% down to buy a home. On a $300,000 home that equals out to be (just for those that are mathematically impaired) $60,000! Myth BUSTED!

You don’t need THAT much cash to buy a home, but there are typically a lot of expenses that aren’t always discussed.

1. If I don’t need 20% down, how much do I need?

It all depends! There are many different options available now. Many banks and lenders have 0% down financing options through government insured loans and in-house options. An FHA (Federal Housing Authority) loan may be a good option for you as well which can offer home loans with only 3.5% down.

Don’t take it from me! A licensed mortgage professional can explain it WAY better than I can, and they can discuss with you what type of options would be available for you specifically!

Need a lender? Click here for my list of recommendations

2. Plan for inspection costs

Please, please, please get a professional inspection done on your home. They may only find a ton of little items that aren’t up to code, but they could also find some major issues that need to be addressed. Your uncle Joe that’s worked construction all his life is awesome, but he builds homes, not inspects them. A trained and licensed inspector checks out homes every day and has a trained eye to spot anything that’s out of place or needs attention.

NOW, with that out of the way, inspections in Middle Tennessee areas (Nashville, Franklin, Spring Hill) do cost between $300-$500 on average and in some rare cases, could cost more. You will also need to allow for a termite letter (just a document stating whether or not the presence of termites were found in the home. Most lenders need one of these). They average around $60-$100 with $100 being on the high side. Don’t know who does that? Don’t worry, we do!

3. Appraisal Fee

All banks will typically want an appraisal done on the house. I’ve only seen some VERY rare instances where it was waived due to COVID-19. Most lenders will ask for this fee up front and is due before the appraisal can be ordered. Expect to pay in the ballpark of $500-$600 for your appraisal.

tired of reading? Just Schedule a Call. we can handle it for you.

4. Closing Costs

Yep, there is always closing costs. Most often there is always some confusion surrounding who pays for the closing costs. While it is true that we can request the sellers to pay closing, the buyer is the one who ultimately always pays them.

Example: Let’s say a seller is willing to accept $300,000 as an offer on their home and not a penny less. Let’s just say hypothetically your closing costs have been estimated by the lender to be $6500. You can offer $306,500 and request the seller to pay up to $6,500 in closing costs (which will give the seller the $300,000 they want after closing costs are paid) or you can get the home for $300,000 and you pay the closing costs out of pocket. Offering more to get your closing costs covered is one of the only ways to get the closing costs “financed”. Still not clear? I can help explain and answer questions. Call me!

We have a better understanding of who pays, now we need to know what it costs. Again, it really varies, and it’s so difficult to throw a number out there which is accurate for everyone. On average we see closing costs to be around 2-4% of the purchase price depending on the purchase price of the home. Some loans have greater closing costs and some are much, much lower (but they will have higher qualification standards).

I hate to be repetitive, but this is a better conversation for a lender after you present all your information to see what can work specifically fo you and your financial situation.

Now you know!

You may not know exactly, but you have a better idea, and you now know what to ask a lender when you have that conversation. I felt so ignorant talking to a lender when we bought our first home (before entering the business). I had no idea what to ask or talk to them about. Now you are armed with lots of questions. I’ll recap the questions for your lender we discussed previously and add a few below!

1. How much of a down payment do I need?

2. How much do I qualify to purchase?

3. How much do you estimate my payments to be at that price?

4. Do I need to pay for my appraisal upfront?

5. How much should I expect to pay in closing costs?

I know, I know, it seems like A LOT. It is a lot and it can get confusing and frustrating in a hurry. That’s why we walk you through step by step, so you don’t need to have it all figured out. We take it one bite at a time and work hard to take as much off your plate, so you can focus on what matters most!