The term For Sale by Owner (FSBO) is quite self-explanatory. It describes the process in which an owner has made the decision to sell their own home. Homeowners usually decide to pursue this route in the hope of saving thousands of dollars in real estate commission. But is this initial commission saving actually a saving? There are myths and misconceptions about selling your own home.

Although it is possible to sell your own home and save on real estate commissions, there can be obstacles associated with this personal undertaking.

· Pricing/savings. Can the initial attraction of saving on commission mean underselling your home? Absolutely. I’ve seen it happen where the FSBO seller decides to price their home and negotiate an offer that is less than the amount they could have received by using a Realtor, and that’s after commission. Equipped with the Multiple Listing Service, a Realtor is able to accurately evaluate the fair market price and negotiate close to it.

· Hidden expenses. Unexpected costs may arise after the buyer’s home inspection. There may be deficiencies that need to be addressed immediately. These could be very expensive fixes that the FSBO seller may believe is their entire responsibility in order to complete the sale. Additional “out of pocket” expenses include marketing and higher legal fees. Although the FSBO seller is not paying any commission to a realtor to sell their property, if a realtor brings a buyer, that realtor will expect to be paid the buyer’s agent’s commission, or negotiate a flat fee arrangement.

· Screening and prequalifying potential purchasers. The inability to accurately determine whether a buyer can afford to purchase your home can cause the FSBO seller huge headaches. When a Realtor is involved with a sale, they are required to prequalify their buyers ensuring that they are viewing a home they can ultimately purchase.

· Bringing strangers into your home. This can be a major safety concern. When you are selling your home and using FSBO websites, you are extending an invitation not only to potential buyers but also to people that may have no intention of buying.

·Exposure. FSBO websites are available when selling your own home however most purchasers are unaware that these sites exist and when made aware can be fearful of them. The majority of buyers search MLS-based websites like Realtor.ca or REW.ca.

· Legal liability. Selling your home can be very complicated. Realtors are insured in the event that a lawsuit arises due to buyer’s dissatisfaction usually caused by misrepresentation and/or non-disclosure. If such issues come up, the FSBO seller would be personally liable. Fact: Even Realtors are not advised to sell their own properties as they are not protected by their insurance.