So you’re interested in selling your house and really entertaining the idea of selling it by owner. Selling FSBO has become popular for homeowners looking to control their homes’ sales and, most importantly, save on costly commissions. But unless you have a background in real estate, you may experience a bit of a learning curve. The best place to start is to learn all you can about selling your house by yourself to be ready to make the sale of your home a success. Below we’ll cover everything you need to know about selling a house by yourself in Indianapolis, so you’re ready to list FSBO.
What is FSBO?
You’ll hear this word a lot, FSBO. FSBO stands for For-Sale-By-Owner. But besides understanding its meaning, it’s important to know what the term encompasses. When you sell by owner, that means you handle the entire process of selling your home by yourself. Everything a real estate agent would handle is your responsibility now. So when listing FSBO in Indianapolis, you’ll be in charge of:
- Determining a competitive listing price
- Getting the house ready by making repairs, decluttering, cleaning, and staging
- Figuring out a market strategy and putting in motion
- Hiring a photographer
- Coming up with a listing description and posting your listing on several websites and social media
- Answering phone calls and emails
- Showing the house and hosting open houses
- Screening offers from prospective buyers
- Negotiating offers and handling contingencies
- Coordinating the closing
- Handling all the paperwork
Besides the other things mentioned above, you’ll need to pack and move your belongings out and figure out your new housing arrangements.
The Benefits of FSBO in Indianapolis
Now that you see what’s involved with selling a house by yourself, you’re probably wondering what the benefits of doing all that work would be? There are several benefits of selling a home on your own, with the biggest being the savings of a listing agent’s commission. Since you’re selling FSBO, you won’t need to hire a listing agent to sell your house. Listing agents usually charge a commission fee of 2.6-3% to list and sell your property. Although that doesn’t sound like much, that can cost you several thousand dollars. Using the average sale price right now in Indianapolis of $181,000, if you were to sell with a realtor, you would be looking at paying between $4,706 and $5,430 in commissions based on that sale price. For many people, it’s worth all the effort because of the potential savings.
Another benefit of selling a house by yourself in control of the sale. You’ll have complete control of how your home is listed, what websites it’s listed on, when you’d like to schedule showings and open houses, negotiating, and ultimately who you’d like to buy your house. Some people like having all that control, and you may find it too.
What For Sale By Owner Sellers Need to Know
If you’re starting to think selling FSBO in Indianapolis is for you, there are a few things you need to know before you put that ‘For Sale By Owner’ sign in the yard. Each state has different rules and requirements for selling by owner, including FSBO sign laws. Yes, laws about putting a sign in your yard. Below is some helpful advice for FSBO home sellers that’s important to know prior to listing in Indianapolis.
Do you need a Real Estate Attorney?
Yes, the state of Indiana does require you to have a real estate attorney handle the closing process. This will be good for both you and the buyer to ensure that everything is done legally.
The Required Indianapolis State Disclosures
When selling a house in Indianapolis by owner, some disclosures are required before officially selling the property. These disclosures include:
- Seller’s Residential Real Estate Sales Disclosure (Form 46234)
- Flood Zone Statement
- Lead-Based Paint Disclosure
These disclosures give the buyer a clear understanding of their purchasing and any risks involved in owning the property. These are legal documents that must be answered truthfully, otherwise, you could be sued later down the road if answered dishonestly.
Are FSBO Yard Signs allowed?
Yes, they are! As crazy as it sounds, there are some states that don’t allow FSBO yard signs. If your home is a part of an HOA, though, you’ll want to double-check that a for-sale sign is permitted in the neighborhood.
How to Price Your Home to Sell in Indianapolis
A little advice for FSBO home sellers, figuring out your listing price will not be easy. It’s honestly one of the hardest things that FSBO sellers struggle with partially because it’s hard to get market information and maybe a slight owner bias. So try to be honest about your list price. Take a look at recent sales data in your area on reputable real estate sites to find an accurate price point for homes of comparable size and condition to yours. If you’re having trouble doing your own research or finding houses in equal condition as yours, you can always hire a real estate appraiser to assess the value of your home in its current state. The appraiser will also use market data to come up with an accurate value for your home.
Price is usually a big reason why houses don’t sell quickly. Find out other reasons why houses won’t sell by clicking here.
How to Sell Your Home By Yourself in Indianapolis
Now that you know what’s involved with selling a house on your own, you still need to figure out how to sell a house by yourself in Indianapolis. Besides the traditional approach, sticking a for-sale sign in the yard and spreading the word that you’re selling your home, there are a few other ways you can go about selling a house in Indianapolis. As you probably realized, selling a house by yourself won’t be an easy task. But if you’re wanting to do it to save some extra money, you may want to consider these alternatives:
Selling Your House Online in Indianapolis
Have you ever thought about selling your home online? Selling houses online has grown more popular for its easy process. Technically you’d still be selling your house by owner because you don’t need a realtor to sell a home online. But to sell online, you’d need to find an iBuyer. An iBuyer is a company that will purchase your house online. This selling strategy will work out well for you because you can avoid all the steps of listing by the owner. However, something to be aware of, iBuyers charge service fees. These services fees can sometimes even cost more than real estate commissions (5-6%). So if you’re looking to save money, you may want to consider one of these other selling options listed below.
Selling Your House Fast and For Cash in Indianapolis
Have you seen those “We Buy Houses in Indianapolis” signs? Those are cash homebuyers in Indianapolis who are usually real estate investors. Real estate investors purchase homes in the area to either keep or fix up and resell. They’re great to work with if the home you’re hoping to sell by yourself needs several costly repairs. They buy houses in as-is condition, so if you’re trying to sell a damaged house, dealing with a leaky roof, a foundation issue, termite damage, or unfinished construction, they’d be willing to make you a cash offer for your home with those issues.
You wouldn’t have to list your home either-or deal with all the steps of selling by the owner because you can sell directly to them. Also, since they pay in cash, they can close on your house in as little as 7-days. This has helped many homeowners that need to sell quickly because they’re in pre-foreclosure, dealing with bankruptcy, or because they just don’t want to wait around for their house to sell.
Lastly, real estate investors don’t charge commissions or service fees to work with them, and they will even help pay closing costs -so if you were hoping to save some money, you definitely can when selling to a local cash home buyer.
→ Interested in working with a local real estate investor? Contact Time Worthy Property Solutions, they are a cash home buyer in the Indianapolis area and are a BBB accredited business. They would be happy to speak with you further about the property you’d like to sell and their easy home buying process.
Selling Your House As-Is in Indianapolis
If you’re concerned about all the repairs you’ll need to make to sell by yourself, you can always advertise that you’re selling your house as-is. You would still go about the selling process the same way as mentioned above, but you would just leave out making repairs to the property.
That being said, if you still plan to sell the property by owner as-is, the pool of potential buyers may be smaller. Most people are looking for move-in-ready houses to buy. To purchase a home isn’t cheap, buyers will be thinking about all the money they will need to spend to buy the house, so the last thing they’ll want to do is spend more money on making repairs once they move in.
Another concern- buyers may have a hard time getting mortgage approval. Mortgage companies require home inspections to confirm the loan amount is close to the value of the home. This is to make sure their investment is supported by collateral. The house acts as collateral or security on the loan. Therefore, the property must be worth at least as much as the bank lends to the buyer to serve as sufficient security. So even if you were to find a buyer willing to take on the repairs, their mortgage company may not approve the loan.
Paperwork Needed to Sell Your House By Yourself in Indianapolis
If you do end up listing for sale by the owner and find a buyer for your house, you’ll need to have the correct paperwork to close the deal officially. In a traditional real estate transaction, your agent would make sure you fill out all the necessary paperwork and forms. As a FSBO seller, it will be your job to navigate the paperwork by yourself.
The process and required documents vary by state- here is a quick breakdown of Indiana’s requirements.
Required for all Indiana Real Estate Sales
|Two (2) Forms of ID||A valid passport, driver’s license, or other forms of Indiana- issued ID.|
|Copy of Purchase Agreement and Any Addendums||Copy of the original signed sales agreement as well as any agreed-upon changes.|
|Closing Statement||A detailed list of all the costs associated with the sale and who is paying them. This is usually prepared by your escrow agent or title company.|
|Signed Deed||To legally transfer your home, you’ll need the deed that proves you’re the rightful owner. At the closing, you’ll sign the deed over to the buyer.|
|Bill of Sale||This is basically a receipt that includes both your info and the buyers. It will also list the final price of the home and what was included in the sale.|
|Affidavit of Title||A notarized document that states you own the property, that there are no liens on the home, that you are not simultaneously selling the home to someone else, etc.|
Additional Documents that may be needed:
- Loan Payoff Information
- HOA Forms and Guidelines
- Survey Results or Survey Affidavits
- Home Inspection Results
- Proof of Repairs or Renovations
- Home Warranty Information
- Copies of Relevant Wills, Trusts, or Power of Attorney Letters (usually when selling an inherited property in Indianapolis)
- Relevant Affidavits (Name Affidavits, Non-Foreign Affidavit Under IRC 1445, etc.)
- Closing Disclosure
- Correction Statement and Agreement
And don’t forget Indiana Disclosure Forms
|Seller’s Residential Real Estate Sales Disclosure||The seller disclosure statement details any known issues with your house and its major appliances and systems|
|Flood Zone Statement||With some mortgages (federally backed ones), your buyer’s lender might require information on the residence’s flood risk.|
|Lead-Based Paint Disclosure||Federal law requires that if your property was built before 1978 that you disclose information about the dangers of lead-based paint to your buyer.|
Many of these closing documents are legally binding agreements. Any errors can affect your sale and cost you thousands of dollars in fees or in relisting costs if it falls through.
To avoid an expensive mistake, you should consider hiring a real estate attorney. While this can cost anywhere from $500 to $5,000, an experienced Indianapolis attorney can answer any questions you have along the way and help guide you through the paperwork process.
Selling a house by yourself in Indianapolis is possible, it will just take some time, effort, and preparation to make a successful sale. Something else to keep in mind, although you’ll be able to save money by selling without a realtor, if your buyer uses an agent, you still may be obligated to pay their commission. Typically the average commission rate in Indianapolis is 5.3-6.1%, split between the buyer and seller’s agents. Since you’re selling by owner, you’ll be able to save the seller’s half, but if your buyer uses an agent, the other half goes to them. And the kicker is that you’ll still be doing the same amount of work to sell your house by yourself.
Once buyers figure out there are still costs involved (possible buyer’s agent commissions and for sure closing costs), the idea of selling to a local cash home buyer sounds better and better.
I’ve you’d like to avoid the hassle, expense, and uncertainty of selling by the owner, consider working with Time Worthy Property Solutions and sell your house right away without having to list FSBO.