How to Buy a For Sale By Owner (FSBO) Home
1. Pre-qualification:
Find a lender you feel comfortable with and secure pre-qualification. You should also have approximately 5% to put down on your home. Many times this requires homebuyers to save for a couple years before shopping the market. If feasible and if the rates are reasonable, consider locking in your interest rate. There certain financial institutions that will require a "lock fee". This is a fee of approximately $250 that will guarantee your rate. If interest rates increase, you don't have to worry, you've already locked in.
2. Find an attorney:
Find a real estate attorney to help interpret and draft forms. I found my first FSBO sale to be worry-free with the help of a professional for a fraction of what it would have cost for a broker.
3. Do your homework:
Research the areas you would like to live in. Investigate schools, taxes, and location. Make a list of the features you're looking for including which ones were negotiable and which ones are "a must". Take your time and don't rush one of the biggest decisions of your life.
4. Search online:
Search the only website dedicated to Arizona FSBO real estate to find the exact home you're looking for.
5. Schedule showings:
Identify several potential homes and schedule a time to visit them. I found looking at 3-4 homes was plenty for one day.
6. Make an offer:
Prepare to give earnest money. Five hundred to a thousand dollars is typical. Be certain to include everything you want in the offer including preferred closing date and contingencies (appliances, window coverings, financing, home inspection etc.). These will be listed on the Residential Offer to Purchase Form.
7. Accept or counter seller's counter-offer.
8. Schedule a home inspection:
If your offer had a home inspection as a contingency, you will need to make arrangements to have the home inspected.
9. Make closing arrangements:
Make arrangements for closing the deal such as securing home owner's insurance, setting up your utilities, hiring movers etc.