Home For Sale: By Owner

[Wannaplan?]

Anyone here ever sell their home without the assistance of a realtor? If so, how did it go? What pitfalls did you encounter? How did the closing go? What kind of fees did you have to pay, like title insurance, etcetera? How long did it take between the time is was on the market and time of sale? What books should I read to make sure that everything goes smoothly?

Let me tell you why I am asking. I am desparate for help.

Last year my family found out my mother took out a $97,000 mortgage on her house. She was 68 years old. She also had 30 credit cards of maxed-out debt. Over the past 12 months my mom went through bankruptcy and will foreclose on her house. That date will be in early November. We just spoke to a relator to see if it's worth our time to put it on the market. After fees, my mom could pocket $105,000. I went to the register of deeds office to find out what we would have to pay the mortgage company, if we wanted to sell the house. If we were to close in September, my mom would have to owe $108,000. My mom doesn't have the $3,000 to make up the difference. So, if I were to help her out by selling it without a realtor, we could pocket the $6,000 in relator fees and actually make $3,000 after we pay back the mortgage company.

My mom is not opposed to foreclosing and losing the house outright. But as her son who grew up in that house - a house my dad built in 1959 for his wife and new family - it feels awful to know that the house will be lost. There is some grace knowing we sold the house. But if we lose it to the mortgage company, that's just awful. My dad passed away six years ago. I am sure if he were alive today, none of this would have happened. I should be angry at my mom for squandering the biggest asset my dad left for. But I'm not. She just doesn't know how to handle money. I feel sorry for her. My sister and I are picking up my mom's mess as best as we can. It's hard telling my mom's neighbors that she will no longer be living in the neighborhood she has lived in for over 40 years.

I don't know what to do. I want to sell the house, but if it isn't cost effective, then I guess the house must be returned to the mortgage company.

 

[Repo Man]

Though I haven't done it, I have been researching a lot of home buying and selling over the past few months. The thing with a for sale by owner is that you should probably have an attorney if you aren't using a real estate agent. I am not sure how much that will run you but I am sure that it is less than what a real estate agent would charge. The only other problem that you may encounter is when a buyer is using a buyers agent. The buyers agent will usually get a commission from the seller because they found a buyer. This is usually much cheaper (around 3%). You can usually negotiate to either pay them from the sale of the house or have it as a credit. You can stipulate that you don't want any agents in your ad, but that may limit the number of buyers.

 

[Seabishop]

I don't have an answer to the main question but I'm going through a similar situation dealing with my parents' self imposed massive debt, pending bankrupcy and other messes. The sh$t is preparing to hit the fan. Its not fun. I wish you and your family lots of luck.

 

[JNA]

That's a pretty scary situation,
and because it, you have now made me wonder about my Mom.

 

[Wannaplan?]

you have now made me wonder about my Mom.

Then you must read this article from the New York Times: As Bills Mount, Debts on Homes Rise for Elderly [registration required]

I'm going through a similar situation dealing with my parents' self imposed massive debt, pending bankrupcy

The bankruptcy was no problem for us. All those predatory corporations that issued their credit cards to a widowed 65 year old woman at 22.98% APR got screwed. Fortunately, for them, they probably get to write all that off. Unfortunately, for you, me, and the rest of the country, we will be paying for it through higer retail prices. For my family, it's the house that's hard.

 

[plankton]

Sorry to hear about all that, Wanigas.

Depending on timelines, it may be worthwhile to check into ebay to sell the home. I think they'll take a 1% commission but they do offer some assistance services. There seems to be a plethora of 'For Sale by Owner' websites out there that may or may not be credible and/or worthwhile. At least with ebay, you've got a reputable resource to fall back on if you have questions, concerns, etc.

Best of luck buddy.

 

[Wannaplan?]

Depending on timelines, it may be worthwhile to check into ebay to sell the home.

I thought about that. Good idea! But still, it will at least be a $1,000 fee, a lot of money right now. But worth looking into. Do you know if they still assess a fee if the house doesn't sell? Like, a $0.50 listing charge? What about the reserve price? Home value is so arbitrary. Our appraissal put it at $125,000, the realtor at $114,000. Nevertheless, I've sold some stuff on E-Bay over the years, and have a 100% positive feedback rating, so I definitely see E-Bay as a viable sales tool. Thanks for the suggestion.

 

[Michele Zone]

If the appraisal put it that much higher, is there any hope of re-financing as a means to clean up the financial mess? Or is it way too late for that?

 

[Wannaplan?]

If the appraisal put it that much higher, is there any hope of re-financing as a means to clean up the financial mess? Or is it way too late for that?

Sherriff's sale has already occurred at the County courthouse. That was in May, the redemption period is six months, giving us until November to hatch a plan. I am sure we could contact the bill collector for the mortgage company and renegotiate the terms of the foreclosure.

But...

My mom no longer lives in the house. She lives with my sister who is two hours away. My sister is taking care of her because of a stroke my mom suffered from a year ago - the catalyst for discovering the extent of my mom's debt - and some cancer that is being successfully treated for as we speak. (By the way, my mom has recovered 90% from her stroke, so that's not a paramount concern anymore.) The long and short of it, is that it makes no sense to keep the house. Refinancing means making payments on a house that no one in our family can afford or wants to make.

Unless you are suggesting that we re-finance to buy ourselves some time? But then again, the mortgage company would probably want to do their own appraissal, which could still come down much lower than our $125,000 quote that was done in November of 2003.

 

[H]

put a sign up. see how it goes. it is very easy. go to Home Depot and buy a for sale sign and see what happens. as long as you use a closing attorney things should go smoothe. it is worth a try anyway.

and i say this as a liscenced (non-practicing) real estate agent. i have helped (&) bought and sold several properties. it is not that big of a deal. you can always post questions up on the board.

good luck.

 

[biscuit]

I must have missed this thread yesterday. Darn work always getting in the way of my slacking time.

I went to college in a tight real estate market and after doing the math my parents found it was cheaper for them to buy a house for me to live in rather than to pay the high rent. Anyway, when it was time for me to move out I made an agreement with ole mom and dad to sell the house myself in exchange for a small portion of what the realtors commision would have been. All in all I can say that it was a very easy process, and I didn't even have to line up a closing attorney - the buyers took care of that. The only real inconvenience came from having real estate agents knock at the door every 30 minutes asking to list the house.

 

[Wannaplan?]

put a sign up. see how it goes. it is very easy.

The more I think about it, maybe it's just best to lose the house to the mortgage company. There are many issues with the dwelling. I would have to disclose all its hangups, especially the way my dad rigged the water hot system so that some rooms on the second floor didn't get heat. He did something with the copper pipes. For the past two winters I had to fix burst copper pipes. Fortunately, the leaks were over the garage. But, after two consecutive years, I think it's clear this is a persistent problem. So, screw the predatory and greedy home equity lenders [sorry greedy home equity lenders, I know you have to make a living, too] and let them get a bum house. Sonsabiches.

 

[SW MI Planner]

Not sure of your living situation, but would you consider buying it? Don't know if that is an option, or if that would help solve the situation.