As a homeowner who has decided to go the for sale by owner route, it’s your job to show your home, sell your home and to handle all the required paperwork. Frankly, you’ve got a lot on your plate. To maximize your time, ask potential buyers the following pre-showing questions to see how serious they are about buying your home.
Are you currently working with a real estate agent or broker?
If buyers aren’t working with anyone, chances are they’re just looking around, trying to get a feel for the market and they aren’t ready to put in an offer. At this stage in the game, it may not be in your best interest to spend a ton of time with these buyers. That said, it may be worth giving a quick showing because if they’re well researched and know what they want, they can get representation quickly.
Do you have a preapproval letter from the lender available? If so, what price range were you approved for?
A preapproval letter will indicate that the lender has verified the buyer’s information and has determined that they are qualified to buy a home. At this point the lender has estimated an approximate dollar amount of house the buyer can afford to pay for. Generally you shouldn’t spend much time showing your home to anyone who hasn’t at least been preapproved to secure financing. If they have no idea what they can afford, they won’t know if your listing is even within their reach.
What type of loan are you considering?
Most home loans fall into one of three categories; conventional, FHA or VA. Each loan type has its own set of qualifying conditions. Generally speaking, conventional loans are usually the easiest to deal with. FHA loans can be a little more tricky and VA can be very strict when it comes to the home’s condition.
Before you start entertaining offers, you should take some time to review the requirements of each type of loan and decide which types of buyers you are willing and able to work with. Doing so will make sure that neither you or the buyer are wasting their time.
What is your time line?
In most cases, buyers and sellers can be flexible on time line, but sometimes there’s a hard deadline in place. If, for example, you need to sell ASAP and your buyers aren’t able to finalize a purchase until 90 days from now, it’s likely not in your best interest to pursue the sale if they can’t be flexible.
Do you have to sell a home before buying this one?
This situation is referred to as a contingency sale – meaning your home sale is contingent on your buyer’s successful home sale. As you can imagine, this setup can create conflict – especially if the buyer’s house doesn’t sell by the time you need to close. You’ll have to decide whether or not you are only going to accept offers from buyers who need to sell their existing property before they can buy yours. Since there are so many complications that could occur, we generally suggest you opt not to work with contingency buyers.
Knowing what questions you should ask buyers to find out if they are qualified to make an offer on your property will save you valuable time.
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