Hello - short-time reader, first time poster. I love what Josh and Brandon are building here. It reminds me of another favorite site of mine which is The Motley Fool. I know not everyone here is a fan of stock market investing but the heart and soul of their product is educating, learning together, and having fun with the process. I see that same culture being built here and it begins with the community. Now, on to my questions.
I plan on selling 1.5 acres of land with front-road access but no utilities. It's zoned agriculture but is ideal for a custom home with or without an in-law suite. I want to sell this on my own, without assistance from a real estate agent or lawyer. I was hoping someone can guide me to a place where I can get standard legal forms for the sale. Below is a list of forms I think I need for the State of California. Am I missing anything?
- Sale Contract
- Real Estate Transfer Disclosure Statement (shouldn't be many given that it's raw land)
- Natural Hazard Disclosure Statement
- Credit Information Form (I am open to financing up to 60% of selling price)
- Installment Land Contract (If I do indeed finance the property)
- Offer To Purchase Real Property
- Counteroffer To Purchase Real Property
- Acceptance Of Purchase Offer
- Deposit Receipt
- Contingency Release
I imagine a Title company needs to be involved to assist with processing the change of title documents and hold funds in escrow. Is this something the buyer decides on or should I utilize a company of my choosing during the sale process.
The first one is always the toughest. Now that my first post is up I look forward to many more.
What is your reason for not wanting to use a realtor? Commission expense?
I will be the first one to admit that most agents are clueless, but the 1% of them that can connect dots are worth there expense to the seller.
I have a few reasons:
- In my local market, the housing market is strong. The land market however is dead (especially for only 1.5 acres) so most of the realtors that focused only on agriculture and raw land have gone away or switched their focus. Basically, I don't think my property will get the focus I need it to get.
- I believe a land buyer is different than a home buyer. My property is ideal for a custom-home site or place to hold a couple horses. I believe the demographic of my customer leans more towards a business mentality and I'm sure they wouldn't mind saving a few bucks negotiating the asking price down. I save on commission and the buyer saves on price. There just needs to be a middle ground.
- Tying to my previous point, more times than not I've noticed realtors who sell land represent both the buyer and seller, double-dipping on the commission. If the buyer is not going to come from a buying agent, why not try to sell it myself?
- I don't mind the experience. This isn't a property I need to sell tomorrow. It's easier than ever to price and market your own property. I thought I'd give it a shot. If it doesn't work out I can evaluate the realtor route again. It's the documentation portion I'm most concerned about and need to make sure I'm up to speed.
- I'm quitting my job in a month and need something to do.
I am not an attorney, but here are some ideas.
You can do everything without an agent and without a title company if you want, but its not going to be easy. I would recommend going through a title company on your first deal at least and ask a lot of questions about what they are doing and what all of the forms are.
You can get most documents from USlegal.com or Megadox.com.
I would start with a purchase agreement and then take it to a title company. I think there are a few too many moving parts on your first deal to do everything in-house, especially with a land contract. You will learn a ton from the title company if you bother them about everything they are doing and ask a ton of questions. Its their job to answer your questions.
Not that the previous post is incorrect, I would strongly suggest against doing it yourself.
I would consider consulting an attorney before searching around for vague documents that you will be legally bound by, and really you will have no idea to what they say or the obligations they impose. I am not trying insulting your intelligence, but an attorney is going to know exactly what to do, and 9/10 is going to take care of everything for you while explaining to you what needs to be done. If they do not take the time to inform you of what needs to be done, or you feel they are not giving what you deserve, it is your right as their client to terminate them.
If you take any document to a title company, they are going to say "ya sure awesome let’s go." They do not have a duty to you, and will not make sure your ducks are in a row. Ignorance of the law is not a defense, and they are not there to advocate on your behalf.
If you find your own document off one of those websites, they are filled with general provisions aimed to encompass, well everyone. They are not tailor maid to you or your property. You will more than likely have to pay for them, and I’m assuming when you purchase them, there is some very very small writing somewhere on their website you did not read that says something like, "in the event this document is rendered void, or unenforceable we shall not be held accountable for any action by any purchaser, third party"...you get the picture.
An attorney will save you time, money, and in the long run, save you from headaches.
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