Posted by notarydi/CA on 6/14/12 9:09pm
Msg #423586

to the Florida folks.....

my dad in Florida (Jacksonville area) wants to sell his house. He thinks he has a buyer and they want to do everything for sale by owner without a realtor/commission involved. I have advised him that I really do think it is in everyone's best interest to have a realtor involved. The house is on 2 acres of land with well water and septic tank. But, he's 83 and determined he can do this himself. So, that said, is Florida an escrow state or attorney state? Any recommendations as to a reputable/reasonably priced escrow/attorney company that could handle the transaction and get them headed in the right direction? thanks, y'all.....

Reply by jba/fl on 6/14/12 9:23pm
Msg #423587

http://activerain.com/blogsview/78001/escrow-closing-procedures-around-the-united-states

Florida Escrow Closings

Title companies and attorneys handle closings. Conveyance is by warranty deed. Mortgages are the customary security instruments. Foreclosures are judicial and take about 3 months. They involve service by the sheriff, a judgment of foreclosure and sale, advertising, public sale, and finally issuance of a certificate of sale and certificate of title. ALTA policies are commonplace. Buyers pay the escrow and closing costs, while county custom determines who pays for the title insurance. Sellers pay the documentary tax. Property taxes are payable annually, but the due and delinquent dates are months apart, November 1st and April 1st.

http://www.closing.com/learning-zone/article/who-handles-closing/

Florida
Title or escrow companies and attorneys customarily conduct closings, but they may also be handled by independent title agents.

Reply by notarydi/CA on 6/14/12 9:33pm
Msg #423588

thanks, that's what I needed to know to point them in the right direction......

Reply by Teresa Harris on 6/14/12 9:35pm
Msg #423589

I am not in Florida but I am a North Carolina real estate broker. Yes, he can do all of this with just an attorney. I would just make sure that he has his own attorney so that he is represented. Have the buyers have their own attorney too. Yes, it might cost just a little more but he is saving a HUGE amount not using a broker plus if he doesn't he really won't get much help if a problem would arise after the deal is done.. Maybe he can use the attorney that did his closing to purchase the subject property..... Good Luck!

Reply by Buddy Young on 6/14/12 11:57pm
Msg #423593

Re: Title company does all the work. n/m

Reply by jba/fl on 6/15/12 7:20am
Msg #423598

Not true.

The correct statement would be: The title company can do all the work.

If you don't know the answer, don't comment. Save someone possible grief.

Reply by Linda_H/FL on 6/15/12 8:17am
Msg #423601

When we sold our property in Polk County in '06

the realtor lined up the title company and attorney as Sellers (us) had to provide title insurance to buyers. When we bought our house here in Columbia County in '06, the Sellers chose the title company and they prepared everything, including our loan docs. Sellers pay for Owners' Title Insurance - they're certifying that they own the property and have clear title to convey...mortgage policy is paid by buyers.

Honestly, I can understand your father wanting to save the realtor commission because as I understand it down here it can be upwards of 7 - 10%. But he needs to get a title company and/or attorney on board so everything is done and conveyed properly and it doesn't come back to bite him later...or bite his heirs.

Ask him for his original paperwork from when he bought the property or check online for the recorded deed. He may have info in there that you can use (like a title company name or the name of the attorney the prepared the docs for him back when he bought it) . If not, I'd google "Jacksonville title companies" and start making phone calls - but in my own personal opinion, and my professional experience, he can sell on his own and come to an agreement without a realtor but there's no way, in today's world, he can complete the deal PROPERLY without a title company and/or attorney on board. In fact, I believe Seller is required to produce certain disclosures to buyers at time of contract and omission of those disclosures can kill the deal.

Good Luck!!

Reply by Julie/MI on 6/15/12 8:31am
Msg #423602

I've sold all my properties by owner.
As others have said, just have a real estate attorney do it.
In my state there are specific forms that must be signed with the purchase agreement, such as a seller's disclosure that the seller has to fill out regarding any leaks in basement roof, structural trouble. Fl may or may not have this.

The realtor's job is to market the property to find a buyer, your dad has already done that!
Why would you pay a realtor a commission for work already done?

Reply by MonicaFL on 6/15/12 9:04am
Msg #423606

I agree with Julie. A real estate attorney can do it all - title insurance, etc. It may cost him about $1,000-to $2,000 but that's much better than paying a realtor 7 to 10% in commission. Just tell him to go with a real estate attorney and he will sleep better after the sale is over and done with. He can also complete the closing in the attorney's office. And, I think any costs he incurs selling the property may very well be tax deductible - and that's always a plus.

Reply by notarydi/CA on 6/15/12 10:58am
Msg #423617

thanks everyone. just what I needed to know.

Reply by Deborah Breedlove on 6/15/12 4:28pm
Msg #423666

..."And, I think any costs he incurs selling the property may very well be tax deductible - and that's always a plus..."

Careful, this may not be true. If he's selling his principal residence, has lived in it at least 2 of the last 5 years, and his gain doesn't exceed $250K if single or $500K if married, chances are that he would not have a taxable gain, under IRC Sec 121. In that case, his selling expenses would not be tax deductible.

If he doesn't qualify to exclude all or part of the gain under IRC Sec 121, the selling expenses would reduce his taxable gain.

If he has a loss, he's out of luck since losses on the sale of personal residences are not deductible.

As an Enrolled Agent, I find that clients often receive incorrect tax advice, particularly from their real estate agents, loan officers, and barbers (imagine that). When the question is "Is this deductible?", more often than not, the answer is "It depends."

Reply by LKT/CA on 6/15/12 7:11pm
Msg #423682

I agree with you, it is in your dad's best interest to have a broker list his home. Please ask him the following questions:

1. Is this a cash sale or does the buyer need financing? Is the potential buyer pre-approved? Not pre-qualified but pre-APPROVED which is at least a 30 day written commitment from a lender? Before a buyer steps foot across his threshold, he should know who they are, where they live and work and that they can afford to buy his home and that only comes with pre-APPROVAL.

2. How did your dad arrive at the selling price? Is it his opinion or did he have it appraised professionally and researched comparibles to correctly price his home? Are there add-ons built to the property and were permits pulled? If not, that add-on will not be considered as part of the square footage.

3. Does he know of ALL the legal forms and disclosures (example: lead paint, flood zone, fire zone, whatever the zones apply to Florida property, etc.) required to complete the transaction?

4. What if he accepts this buyer's offer, then two weeks later, someone else offers him $30K above asking price? Does he know the legal ramifications if he even thinks of ditching the first accepted offer to take the bigger offer?

5. How much of an earnest money deposit is he going to require of this buyer? Does he know the legal maximum for Florida, if there is one? In CA, if I remember correctly, it's 3 percent of the sales price.

6. What if this buyer falls through and now the property is back on the market. Who will advise him on how best to stage the property for the best presentation? (i.e., a few cosmetic upgrades like a fresh coat of paint inside; updated sink fixtures, door knobs and reface kitchen cabinets; replace family photos on wall with neutral portraits <fruit bowls, flowers bouquets, meadows, etc.>

7. Based on question #6, who will market and hold open houses?


8. Whose handling the termite expection, title search to present clear title to the buyers, home inspection, etc.?

9. Who truly saves $$ when a homeowner sells without an agent? Hint: It's NOT the seller!

10. Does he know that every aspect of the transaction must be in writing and changes are not unilateral but bilateral - meaning changes must be approved by both seller and buyer?

If he has no experience in F.S.B.O., the above are important issues to seriously consider. Being that laws are state specific, I'm positive there are more issues to Florida real property than I'm aware of. There is far more to a real estate transaction than most people think and the money people think they're saving by selling their own property could cost them big time if they don't handle everything by the <law>book in their proper order or manner. JMHO

Note: For those who have experience with F.S.B.O. and were/are successful, wonderful....nothing I wrote applies to you. For the inexperienced, *consider* the above.