Are you thinking about selling your home on your own?
A recent study by the U.S. Department of Justice
found that people who sell their own homes -- an approach known
as "for sale by owner," or FSBO (pronounced FIZZ-bo) -- can save as much
as $7,500 in real estate commissions on the sale of a median-priced
To increase the odds of a sale, many solo sellers turn to companies that help with the FSBO process.
These organizations suggest ways to create professional "for sale" listings and offer other services, all without charging full real estate commissions.
"With a little bit of work, anybody can sell their
home on their own and save thousands of dollars," says Eric Mangan,
a spokesman for ForSaleByOwner.com.
However, it's important to understand the potential rewards and challenges of a FSBO sale before trying this approach.
Going it alone
Traditionally, most people have sold their homes by hiring real estate agents. These agents help market the house by scheduling showings and hosting open houses.
Real estate agents also have access to a multiple listing service, which is a database of homes offered for sale in a given area.
"You have to be a licensed real estate agent or broker in order to list a house in the MLS, and it is the single best tool most agents have," says Robert Irwin, author of "The For Sale by Owner Kit."
If the house sells, the seller pays a commission of around 6 percent of the home's price. The money usually is split equally between the listing agent and the buyer's agent (if there is one).
By contrast, people who go the FSBO route bear the responsibility for marketing and selling their homes. These sellers set the sale price and show the house. In some cases they also help the buyer through the purchase process.
The reward for such hard work can be a substantial savings by eliminating the commissions typically paid out to real estate agents.
Today, several companies provide help guiding sellers through the FSBO process. These companies are generally found online and offer various services.
For example, many FSBO companies allow you to list your home on their Web sites, and some do not charge for this service.
"It's important to take advantage of that offer," Irwin says. "Selling is a numbers game, and some sites can reach literally millions of people."
To get your house listed, fill out a form with all the important information: square footage, number of bedrooms, number of baths, etc. You can also upload pictures of your house.
"The pictures are important because that's what really helps sell a home," Irwin says. "The potential buyer can start to identify with your house, even though they haven't physically driven through your neighborhood."
Some FSBO company Web sites include other information about the home, including the local school district, neighborhood crime rates and the type of shopping located nearby, Irwin says.