For Sale By Owner in Texas

If you want to sell your home without employing a real estate agent, it is possible to do a “For Sale By Owner” in Texas. However, there is quite a bit of work involved, and you need to understand the contracts and applicable laws in your situation. You may not understand how to implement online tools properly without professional expertise. The real danger is losing your investment to a future lawsuit for lack of understanding of the real estate laws in Texas.

Legally Binding Contracts 

By law in Texas, you do not need a realtor to sell your home. However, selling a home is a long and drawn-out process in which you will need to understand different types of contracts and their purposes.  It makes sense to hire an attorney to oversee the process if you choose to go it alone. You’ll need to find the versions of contracts that are legally acceptable in Texas.  

The Texas Real Estate Commission states that its “contract forms are intended for use primarily by licensed real estate brokers or sales agents who are trained in their correct use. Mistakes in the use of a form may result in financial loss or a contract which is unenforceable. Persons using these forms assume all risks associated with their proper use.” The Commission also recommends seeking the assistance of an attorney if you use their forms in a real estate transaction. 

Finding What You’ll Need

Some of the contracts and items you will need to research and produce yourself or find online include:

• Texas Real Estate Contract: You can find many of the forms you’ll need at the Texas Real Estate Commission. Usually, for a private home sale, you’ll need the One to Four Family Residential Contract.
• Seller’s Disclosures: The Texas Seller’s Disclosures are vital because you must disclose everything you know about any problems associated with the house by law. If you fail to disclose a busted pipe that you had repaired two years ago and it opens up and floods your home after the sale, the new owners could sue you for damages.
• Third-Party Financing Addendum: used when any type of financing for all or part of the purchase price will be provided by a third-party
• Homeowners Association Addendum: You must include a Residential Contract Addendum for HOA if the property you are selling has a mandatory membership in an HOA.
• Warranty Deed: You will likely need to hire a title company to research the history of your home and guarantee that you own the property and can legally transfer title to the new owners. Usually, they will prepare the documents for a final signing with the seller unless they agree to handle it electronically.

Getting the Word Out

Selling a home without an agent is possible, but you’ll need to get the word out to buyers that your house is for sale. Real estate agents use the Multiple Listing Service (MLS) to accomplish this. However, in today’s day and age, you can get the word out on multiple other online services, including Zillow, without putting your house in the MLS. You can also choose to work with service providers who list your home on the MLS without becoming your real estate agent.

Real Estate Agent Fees

Usually, real estate agents charge 6% of the total sale. So, if your house sells for $240,000, your agent pockets $14,400. However, if the buyers also have an agent, they usually split the income in half and earn 3%. 

When selling your home by owner without using an agent, the buyer’s agent may require a fee. You may need to pay their agent a percentage of the sale’s proceeds as part of the negotiations with the buyers. 

Selling to a 3rd Party

Selling your house to a 3rd party can also work well if you don’t want to hire an agent. With the money you save not paying a real estate agent commission, you can afford to sell to a company that makes it all happen. They may pay less than the market value of your home, but you don’t have to stage your home or have unwanted visitors coming daily to look. When selling to an investor, you can often sell the home as-is and the closing may happen quickly. You may even get cash in hand. 

This scenario is a good choice if you are running out of options to pay your mortgage or if your home needs repair and refreshing, but you don’t have the funds.

Consult with a Professional

Whether you choose to sell your home to an interested private party or a 3rd party buyer company, looking at your options and considering your unique situation can help you move closer to your best solution. Consulting with a knowledgeable real estate attorney can make complicated contracts easy to understand. With an attorney on your side, you can walk confidently through a home selling process without a real estate agent. Real estate attorneys have no agenda other than your best interests. 

We Can Help

If you are selling your home and need a real estate attorney to check over your contracts or assist in other ways, contact us at Jarrett Law. We specialize in real estate solutions related to buying and selling, foreclosure, keys for cash programs, 3rd party buyers, home loan modification programs, and more. Contact us today to find out how we can help you.