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Just reached a verbal agreement with a FSBO

Posted by agentslim (My Page) on
Sat, Dec 17, 11 at 21:43

I just reached a verbal agreement with a FSBO on a lot. It will be a cash purchase. This is my first real estate transaction. He is opening up escrow on monday. Should I hire a lawyer? What steps do I need to take to protect myself?


Follow-Up Postings:

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RE: Just reached a verbal agreement with a FSBO

Get a written contract, signed by both parties.

Oral contracts are not valid for real property under the statute of frauds.

How much did you say you agreed to pay?

That's not what I remember.


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RE: Just reached a verbal agreement with a FSBO

Agree sales price was 190k. Escrow will open monday


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RE: Just reached a verbal agreement with a FSBO

Agree sales price was 190k. Escrow will open monday


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RE: Just reached a verbal agreement with a FSBO

And what will you do if the seller does not show up?

Or cannot convey clean title?


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RE: Just reached a verbal agreement with a FSBO

He will be providing a contract as well. Should I get a real estate attorney to review it?


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RE: Just reached a verbal agreement with a FSBO

YES! Call one first thing Monday morning.


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RE: Just reached a verbal agreement with a FSBO

Are there websites to find reputable real estate attorneys? like with reviews etc...?


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RE: Just reached a verbal agreement with a FSBO

You want to make sure you get a copy of the plat, showing easements, building restriction lines, and if applicable, you want to see septic areas and the approved well location. There is no use buying a piece of property if it is all eaten up with restrictions, making it difficult to site your house. You also want to make purchase of this property contingent upon successfully digging a well and getting the appropriate water pressure/cleanliness. You also want to make sure there are no outstanding liens or taxes owed against the property. It would be a very good idea for you to get involved with a title attorney. Good luck.


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RE: Just reached a verbal agreement with a FSBO

To put it simple---who is looking out for YOUR best interests?? Not everyone is an honest person!!


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RE:. Just reached a verbal agreement with a FSBO

Me again - a few more thoughts.

You also want to make sure there was a recent survey done, and the property corners are marked. You don't want to buy what he is telling you is a certain size lot, only to find out too late that it is much smaller. Even if you have a plat showing the layout of the lot, you still sometimes run into problems with the actual property location. If you were to find out one of the neighbors is encroaching upon your property, or vice versa, you want to find out now. This survey should be done at his cost, by a reputable surveyor.

You should also be talking to realtors and hire a buyer's agent who specializes in land sales. They would be the ones who would know if your price is indeed fair. This realtor can also help you locate a good attorney, and can help you with other people associated with building your house.


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RE: Just reached a verbal agreement with a FSBO

"You also want to make sure there was a recent survey done"

An owner provided survey is not worth the paper it is drawn on.

YOU need to order a survey to check the boundaries and if there are any encroachments or easements of record.

He may have hired his good friend Bubba to do the survey.

Luckily the fact that oral contract for real property are invalid cuts both ways.

He has no recourse if you do not show.


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RE: Just reached a verbal agreement with a FSBO

Thank you guys, this is such an exciting yet nerve wrecking situation. I will use your advice! Will keep you guys posted! Thanks again!


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RE: Just reached a verbal agreement with a FSBO

Good luck.

Not having a contract leaves a lot of loose ends.

If you get to closing make sure you get an owner's title insurance policy (along with any required lender's policy).

The title insurance company will do a thorough review of the chain of title for the property, looking for defects.


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RE: Just reached a verbal agreement with a FSBO

I think that you should totally just trust the seller, and not have a contract. I'm sure that they will look out for you [/sarcasm]


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RE: Just reached a verbal agreement with a FSBO

What we did when we bought our house FSBO:

We verbally agreed on a price and closing date. Then we sat down with a "standard" contract for our state and struck/added clauses based on those verbal agreements. We then agreed to a couple day window to allow our respective lawyers to review before we both signed.

The process does not have to be adversarial, but you really do need a contract and you really should have a lawyer to make sure everything is done properly.


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RE: Just reached a verbal agreement with a FSBO

"We then agreed to a couple day window to allow our respective lawyers to review before we both signed. "

you should have put the legal review into the contract as a condition, and then signed it.
At least them you would have a contract (though still subject to review by each of your attorneys).

with nothing signed the either party can just walk away, ask for changes (like in price), or other concessions.

Until you have a signed contract there is no 'meeting of the minds' that is enforceable, for or against either party.


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RE: Just reached a verbal agreement with a FSBO

Escrow has closed and we own the LOT! Thank you everyone! Design phase has begun!


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RE: Just reached a verbal agreement with a FSBO

Congrats! Can you share with everyone here how the process went? It could be useful to others who will go through the same thing in the future.


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RE: Just reached a verbal agreement with a FSBO

After we reached a price with the seller. He went ahead and opened escrow at a title company. I had an attorney check out the contract and the title was clear. It was a smooth process. I was able to save the real estate agents commission dealing directly with the owner. Just make sure you check with the city regarding and restrictions for the land you intend to purchase!


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RE: Just reached a verbal agreement with a FSBO

Congrats agentslim! Hope things go well with the next phase!


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