Buying a home without a real estate agent can save you money on commissions and allow you to shop on your own timeline. Here’s the process you’ll go through to buy a home without a buyer’s agent.
Step 1: Get Preapproved For A Mortgage
When you buy a home without a real estate agent, the first thing you’ll need to do is get preapproved. A preapproval is a way to find out what you can afford so you don’t shop for homes outside your budget. It’s also a way to show sellers you’re serious when you’re making an offer; preapproval shows that your financing won’t fall through.
You can use Rocket Mortgage® to get approved online and see how much you can afford. Just answer some questions about your income, assets and the home you want to buy. Then, we’ll check your credit to give you real interest rate and payment information so you know your budget.
Step 2: Research The Neighborhood
Research the neighborhood you’re considering. Learn about the average selling price in the area and think about what you value in a neighborhood.
Do you need easy access to public transportation? Would you prefer to buy in an area with highly rated public schools? Narrow your search by neighborhood and then start looking at homes for sale.
Step 3: Find A Property
Once you’ve settled on a neighborhood, it’s time to start looking for homes on the market. Look for places in your budget and keep a running list of properties that might be right for you.
Once you find a home you like online, you can visit it in person. Online listings typically include a phone number for either the seller or the seller’s agent, or a list of upcoming open houses. If there are no open houses scheduled, contact the seller’s agent to request a tour.
As you look around the home, take note of the property’s condition. Find out exactly what’s included in the sale. You’ll want this information when you’re considering how much to offer.
Step 4: Ask For Seller Disclosures
A seller disclosure is a list of known issues with the home. Seller disclosures may also let buyers know about remodeling work the seller did on the home.
Here are some things you might see on the seller’s disclosure statement:
- Structural issues
- Plumbing, heating or electrical system problems
- Any use of lead paint, radon or asbestos
- History of damage from termites or other wood-boring insects
- Toxins in the soil
- Mold and water damage
Sellers are only responsible for telling you about issues they know about. They might also avoid disclosing issues if their state doesn’t legally require them to do so.
The only disclosure that’s required nationally is the lead-based paint disclosure. Sellers in every state who own a home built before 1978 need to tell buyers about any lead paint used in the house.
Some states have their own rules about seller disclosures. Before you make an offer on a home, research your state’s disclosure laws.
States without disclosure laws take an approach called “caveat emptor,” which means “let the buyer beware.” There’s one way to get around caveat emptor rules: by directly asking the seller about specific issues.
If you know that you live in a caveat emptor state, here are some questions you might want to ask:
- Do you know of any asbestos in the home?
- Do you know of any problems with the home’s heating or plumbing system?
- What kind of condition is the roof in? When was the roof last repaired?
- Has the home ever had termites?
- Is there any mold in the home?
Most states require the seller to answer directly and honestly when asked questions about the property.
Step 5: Make An Offer
Once you find a home and are satisfied with its condition, it’s time to make an offer. Deciding how much to offer for a home can be tricky. Consider prices of other homes in the area, how long the home has been on the market and the home’s condition.
Generally, you’ll want to offer lower than the amount of money you’re preapproved for. This will give you room to negotiate.
After deciding how much to offer, you can write an official offer letter. Here’s what the letter should include:
- The full address of the home
- Your full legal name and the names of anyone else buying the home with you
- The amount you’re offering for the home
- Any contingencies you’re requesting (i.e., conditions that need to be completed before the sale goes through)
- Any seller concessions you’re requesting, such as discount points or cash toward closing
- A copy of your mortgage preapproval letter
- Items you want to be included in the sale, such as appliances or window dressings
- The date you expect to close
- The date you want to move into the home
- A deadline to respond to your offer
Submit the offer to the seller’s agent. If the home is for sale by owner, you can submit the offer directly to the seller. The seller may then accept your offer, deny it or return with a counteroffer.
Step 6: Hire A Lawyer And Home Inspector
Home inspections aren’t usually required by your mortgage lender, but they can reveal hidden issues that the seller might not know about. A typical inspection covers surface-level elements of the home, including its plumbing, structure, heating system and more.
Some states require you to get a real estate attorney to finalize your home sale and transfer your title. Even in states where real estate attorneys aren’t required, a lawyer can help you deal with the paperwork and any legal gray areas.
Step 7: Negotiate
If the disclosures or inspection reveal an issue with the home, there are a few ways you can negotiate with the seller.
Ask For Repairs
You can ask the seller to repair any problems with the home before closing.
Ask For Reimbursement
You can ask the seller to reimburse you for the cost of repairs. This guarantees that you’ll get work from a quality contractor because you choose the professional. However, you might have trouble getting a seller to agree to paying a bill if they don’t know how much it will be.
Ask For A Discount
You can ask the seller for a reduction on the sale price if there are significant repairs that need to be made.
Cancel The Sale
If you can’t reach a solution with the seller and the issues are a deal breaker for you, you can always cancel the sale.
Remember to negotiate in writing and keep records of emails or other written exchanges between you and the seller.
Step 8: Finalize Financing And Close
When you reach an agreement with the seller, it’s time to close on the loan. As soon as the appraisal and underwriting clears, your lender will send you a Closing Disclosure.
Your Closing Disclosure tells you about the terms of your loan, your closing costs, your interest rate and more. If everything looks good, contact your lender and schedule your closing. Once you’ve signed on your loan, you’re officially a homeowner.