How to do a for sale by owner
A for sale by owner is also known as a FSBO. It always starts with a contract for sale and purchase between the seller and buyer. The seller will want to confirm that the buyer has a loan that is pre-qualified, not just pre-approved.
Attorney Tom Olsen: Helen you're on are on News 96.5, go ahead.
Helen: I'm a widow and I lost my husband of course and I want to sell my house. I don't want to go through real estate to sell it. I was wondering what other directions can I go to get someone to help me with that.
Attorney Tom Olsen: Well, Helen what you're talking about doing is a for sale by owner. Is that what you mean Helen?
Helen: Right. Exactly.
Attorney Tom Olsen: What you typically do is you get a sign, you put it out front. Put for sale by owner and people are going to call you. Once you find a prospective buyer, then it's time to do a contract for sale and purchase.
Helen: That's the ticket I'm looking for. How do you do that?
Attorney Tom Olsen: Well, Helen I can definitely assist you. I recommend that you give me a call.
Helen: I can go through a person like you to close it?
Attorney Tom Olsen: I can do it from start to finish, from contract to closing. Helen I can help you with that. All you want to do is talk to your buyer and say are you pre-qualified. I'm not going to talk to you. I'm not going to let you in my house until you show me a letter that says you're pre-qualified to borrow x amount of dollars.
Helen: Now they have to go out and get somebody a banker or something to prove that that or something?
Attorney Tom Olsen: It's not a pre-approved, it's a pre-qualification.
Helen: Okay. Still, if they come up with something from some banker and they say they're pre-approved that means they're safe?
Attorney Tom Olsen: No, pre-approved means that you called somebody on the phone they said, "How much money do you make?" And they send you a letter that says you can borrow x-amount of dollars. To get pre-approved you're not giving them copies of your tax returns they are not doing a credit report on you. Pre-qualified means you've literally given them tax returns they've done a credit check on you and they are fully prepared to loan you money.There is a big, huge distinction between pre-approval and pre-qualified. You're looking for pre-qualified not pre-approved Helen.