The Money Mustache Community
Learning, Sharing, and Teaching => Real Estate and Landlording => Topic started by: El Gringo on July 20, 2017, 05:50:20 PM
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My girlfriend's father just passed away and her mom has moved into a nursing home and as a result she will be selling the house. There is someone who is making an offer if it is not put up on the market. His friend lives next door, and everyone could avoid the fees of a realtor. He is offering $80k and the house was appraised by a realtor to be in the low $80s. This rural Kansas town of 3,000 people currently has 120 houses for sale (or something like that). So this offer is very attractive, we think.
Are there questions we should be asking? Things she should be ensuring? Precautions to take? What is the process when you sell privately, not through a realtor?
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I did a private sale. I asked a realtor that I knew what he would charge for just helping me with the paperwork and closing. He charged $1000 on a 280,000 sale.
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We bought 2 houses without them being listed. Hire your own lawyer to search the title, review agreements and attend the closing.
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Just go to title company. No lawyer needed. They will tell you everything you need, and close the sale as it should be done. All for like $250, plus expenses.
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We used our realtor for our fsbo sale. He charged 1% instead of the usual 3%. Well worth it to have him handle all the contacts, schedule closing, etc etc.
At that price point in that kind of town I'd take it and run.
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Sounds like a good deal!
I would use a real estate attorney.
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We did an estate sale after my mother passed away. My dad no longer wished to live in the house without her and we were in the process of moving him out of state to live with my brother. We weren't ready to clean the house out so fast, but the annual community garage sale was our best chance to do so. During the event, we received a cash offer from a man who was a neighbor, a realtor, and a probate attorney. We told him we'd already had a higher offer from another neighbor, so he increased his and we accepted. The sale was a breeze, he did all the work and no commissions were paid.
Of course, my black sheep sister went ballistic. She thought we "gave away" the house because she was not privy to the details of the sale. That's a tale for another thread, once the estate is finally settled.
Tl;Dr: I vote yes.
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Just go to title company. No lawyer needed. They will tell you everything you need, and close the sale as it should be done. All for like $250, plus expenses.
I second this, just skip over the realtor. Until I did some real estate transactions myself, I didnt even know title companies were available. I just assumed you always needed a realtor....
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If mom may have to eventually get medicaid assistance to pay for her nursing home case, you should be very careful. They will typically "look-back" 5 years (may vary by state) to see what happened to assets that she owned. If assets were sold, they must have been sold at a fair market value and the entire proceeds used to pay for her care and living expenses. Otherwise it can adversely affect medicaid eligibility.
Especially be careful if the "private offer" is from a related party. In that case in particular (probably in any case), you'll need to be able to document that the house is being sold for "fair market value". Check with local medicaid office for acceptable documentation. They may accept a market analysis by a realtor or tax appraisal or require an actual appraisal to document it.
Other than this concern, it sounds like something I'd be all over if it were me. Be sure any tax & estate considerations are covered.
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If the offer is good and you don't want any issues to arise later on, you must seek help from a realtor. The paper work and other legalities will also be taken by him.
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Ponyboy thinks its a great deal and that you should take it.
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Just go to title company. No lawyer needed. They will tell you everything you need, and close the sale as it should be done. All for like $250, plus expenses.
In states where "Title Companies" exist, this can work. There are none in my state. All title matters go through the county.