Buying a home in LA without a realtor
 

I am very keen to buy my neighbour's house. He wants to sell but would rather not use a realtor. Cut out the middleman. I have no problem with this but don't really know what's involved with buying a house over here. It seems rather more complex than the uk. In UK I just found the house, found a mortgage online, got a lawyer who did every thing I needed including deal with the money side and that was it. Simple
Here there are the seller's realtor, the buyer's realtor, real estate attorneys, escrow companies. Seems to be a lot more people looking for a piece of the pie.
As I understand it I would be advised to definatley get someone to help me. Seems like an attorney would be most useful. It's unlikely the seller would pay for my realtor since they are not using one. If I just employed an attorney what work would I have to do. Would I need to do the title searches, lien checks etc. myself. I assume that I need to organise the home inspection myself of course.
Any help on this maze would be greatly appreciated.

Re: Buying a home in LA without a realtor
 

some info
http://www.ehow.com/how_5847_decide-whether-buy.html

the attorneys
http://attorneypages.com/lawyer-real...os_Angeles.htm

Re: Buying a home in LA without a realtor
 

I did this twice in the US and if you haven't involved realtors, you definitely don't want to pay the 6% realtor commission (esp. in LA, where I'd guess this amounts to quite a chunk of money).

Bearing in mind that different states do things different ways (I did this in TN and NC), your best bet is to visit a real estate attorney first as you can't buy/sell without one as far as I know (they write up the sale contract).

Have you and the buyer already agreed on a price? If so, life is easy - you could even use the same attorney as all you need is a contract written up which reflects what you've agreed on (the usual stuff, price, completion date, fixtures & fittings, etc.).

Are you assuming his/her mortgage (might be recommended if they have a good rate fixed interest mortgage)? If so, you'll need to discuss what you will do with the escrow, and include this in the contract.

Various little bits to think about, but your attorney can advise you on all of them. You don't need a realtor in this situation and it would be almost unethical for a realtor to get involved (one exception: you might, if you were a little leery about being a newby to the sit'n, ask a colleague or neighbor for a trustworthy realtor and see if he/she is willing to just oversee the process for a fixed fee (I'd think $250 to $500 would be a reasonable amount, as there wouldn't be much work involved).

Good luck with it. My first purchase was from a neighbor, and it worked fine. I assumed her mortgage and gave her $6,000 in cash. She had only recently bought the house and promptly met a millionaire who wanted to marry her, so she no longer needed it. I'd been searching for 3 months, and all the time my dream house was across the street!

Re: Buying a home in LA without a realtor
 

Have a look at www.nolo.com They mostly sell books (and they have one on buying a home in CA) but they also have useful articles and forums online.

Re: Buying a home in LA without a realtor
 

ditto to dun's post.. I've done this before and simply used a real estate lawyer to draw up the contract, look over what the seller gave me and make sure everything was in line. He also helped me make sure I was on target for a few other things; good advice all around.
Less than $1000, and we used him again when we sold the property. Realtors do a lot of things, but youi don't need one for this deal.

Re: Buying a home in LA without a realtor
 

But the seller has to pay the 6% not the buyer. An experienced realtor should protect the purchaser and arrange inspections etc. In turn the purchasers realtor gets half the fees from the selling agent.
Unless the seller is offering some great incentives it does the buyer no favors to save the owner 6% realtor fees

Re: Buying a home in LA without a realtor
 

how about checking the title, boundaries, liens etc. that sort of thing. Would a lawyer do this, escrow or would this or is this a realtors job?
I am doing as much reading as I can about the whole process. I am sure that it is actually quite a straightfoward process in general but people like to hype up the dangers and complications. There are too many people with a vested interest in the process. Call me cynical if you may. Not to say I am unaware of the dangers and pitfalls.

Re: Buying a home in LA without a realtor
 

Not sure mate. To be honest I've never purchased here so don't want to give you bad advise. I've been through it to a degree as we were looking to buy as recently as 2003, but that's another story.
I beleive the loan company do the title search, survey, transfer ( and charge you loads of fees for the pleasure) and the realtor is a middle man familiar with the procedures who 'should' co-ordinate between the bank, selling agent and yourself.
Call a realtor, there's loads of them around. Ask them the above questions but under no circumstances sign a contract saying they are your 'sole realtor', which basically makes them your official realtor, one tried to do this to me when I was looking.
As I said the seller pays the realtor fee so what are the incentives for you not to use one? Is the seller passing some of this discount to you? Or just trying so save himself 6%, thus leave you vunerable having no-one acting on your behalf?!

Re: Buying a home in LA without a realtor
 

The title company does that, and they issue 'title insurance' to cover their findings. I should've mentioned that, the title company worker is your valuable partner in this deal; they hold the earnest money in and escrow account for you.

The Realtor pulls all this stuff together for you.. you are taking up a sharp learning curve, but I'm sure you can manage.

In response to Lord Lionheart's post, I think the benefit is generally that the buyer is getting a price that is essentially discounted.
It's also possible for the buyer to have a Realtor (to help them navigate all of the above stuff) and the seller to not have an agent. The buyer's Realtor typically asks for a fee/commission from the seller. I told them 'no' when I was the seller, because I had a line of buyers. :)

Re: Buying a home in LA without a realtor
 

Of course it does, as someone who has a property on the market.

I am only looking at the net, if the Buyer in this case wanted to use a Realtor then all I do is up the price.

Buyers pay for everything, directly or indirectly.

We are looking to buy, maybe land and build. But I know enough now to be very careful before I lock myself in to using a realtor to buy.

I am using a realtor to sell, but made sure we negotiated a reasonable fee and that I was very certain of the added value I was getting, too many amateurs out there.

Re: Buying a home in LA without a realtor
 

the seller 'pays it' but who is paying the seller? - the buyer....

I'm a realtor and in this example one is definitely not needed.

spending 3 mins calling a home inspector does not require a realtor - in fact I would prefer to use a home inspector NOT chosen by the realtor...

just make sure the sales price factors in the fact that 5-6% is not going in listing fees...

Re: Buying a home in LA without a realtor
 

Not looking to argue or pass myself off as an expert.
My point is that the buyer should make sure there actually are some incentives,
The OP clearly stated:
He has never done this and is an expat that could be taken in by someone who sees a green, newbie just off the boat, (no disrespect to the OP) and is trying it on.
It's not beyond the realms of possibility that the seller could be greedy, is asking top price for his house and looking to save 6% agent fees................. Jeez :rolleyes:

Re: Buying a home in LA without a realtor
 

The seller pays the real estate agent. The buyer pays the agent nothing. Therefore the seller is getting a discount - some of which should be passed on to you.

You should get the house appraised by a licensed real estate appraiser, so you know what it is worth.

Re: Buying a home in LA without a realtor
 

Yes the mechanics of the transaction should not be a problem, the main point is a fair price.

Re: Buying a home in LA without a realtor
 

I would suggest having a contract that has a sales set at an agreed price or the appraised value by your financing-bank approved appraiser minus 10% (at least). whatever is the lower

appraisers are only slightly more competent that the average realtor (isn't saying much)

the appraised value in a lot of cases is a load of bollocks - a house is worth what 'a ready, willing and able buyer' is prepared to pay.

If your house is appraised at $400k and you list it at $360k you can obviously see the appraiser is talking out of his ass....

Re: Buying a home in LA without a realtor
 

this is very easy to determine in most cases.

find someone who has access to the local mls and run a report detailing comparable houses in the same area as the buject house that have sold in the last 6 months....

thats 85% of what an appriaser does and gives you a real world idea of what the place is worth. And look at the sales price - not the original listing price...

Re: Buying a home in LA without a realtor
 

Yes, good point, this info is easily available. At the end of the day anything is only worth what someone will pay for it. If the property is very desirable then the OP is geting an advantage by no competition.

Re: Buying a home in LA without a realtor
 

Yup

It also depends what the buyers objective is

for example our house was a foreclosure, and I know for a fact that I could probably got the place for 3-5k less than we paid - but we were in a bidding war with a few people looking to renovate and flip it. Our objective was to have a family home and 5k to us over the timescale we intend to keep the property was not something that bothered us...

Re: Buying a home in LA without a realtor
 

www.zillow.com can give you basics and recent local sales ..
to get a guide ..

Re: Buying a home in LA without a realtor
 

just speaking for my area, zillow is pants...

my house which is bigger (sq ft), on more land, with more bed/bath is valued on zillow at 20% less than my next door neighbour and the house across the street...

wheras it reckons one of my slightly ghetto duplexes up the street is worth 650k :rofl::rofl: (more like $140k)

Re: Buying a home in LA without a realtor
 

thanks for all this super useful information, its really been a help.
The house is being discounted heavily. The owner wants to sell it to us or to a fmily that will actually care for the place and live there rather than just flip it. He just lost out big time to a speculator that screwed him big time. Sold it for 500K to this guy that promised him he would live there and build up the place nicely. 3 months later the guy is trying to flip the place for 800k.. he must be laughing all the way to the bank. Anyway I have checked similar properties and since it is actually my neighbour that is selling I have a pretty good idea of the prices in the area. It's reasonably priced though definately at the upper limit of what I can afford. It is the worst house in the best location as it were which I believe is always the best place to by if possible.
So my plan is to find a real estate attorney for the contract stuff. Call up a home inspector, he already has an escrow company in place. The bank is sorted out and can handle their own inspections. I also need to get a home insurance quote or go with whatever the bank recomends (not sure if there is anything bad about using the banks recomendation). Is the escrow process part of the title company or do I need to find that as well.
I need the attorney to write up the offer, then get the title checked, the inspection done and if necessary renegotiate the offer. Finally hand over the cash and hope that I don't lose my job as I get the keys to my new house.
Would this be about right. Sorry for repeating myself but it really helps to get this stuff down in writing to sort it out.
My realtor friend would help but only for her company standard rate of 3% which is clearly ridiculous in this situation.
thanks again for all the advice

Re: Buying a home in LA without a realtor
 

Where is it just out of interest?

Re: Buying a home in LA without a realtor
 

You can alter the info ....
For over here ..its been incredibly accurate ....

Re: Buying a home in LA without a realtor
 

I don't think you really need to get an inspection before you put in an offer. See an attorney first, get him/her to write up the offer with appropriate contingencies (subject to satisfactory inspection, buyer has right to withdraw if repairs come to more than $ X,000, subject to buyer obtaining financing, etc. - ask your attorney). Then, once your offer is accepted, get the inspection done. ANYTHING can happen in house-buying, so don't spend money on an inspection only to find that your neighbor accepts an offer from elsewhere ...

Re: Buying a home in LA without a realtor
 

A properly worded offer comits you to not a lot.

Re: Buying a home in LA without a realtor
 

That's a really good point - there should be plenty of contingencies that let you out.

Re: Buying a home in LA without a realtor
 

[QUOTE=angelman;5115500]I am very keen to buy my neighbour's house. He wants to sell but would rather not use a realtor. Cut out the middleman. I have no problem with this but don't really know what's involved with buying a house over here. It seems rather more complex than the uk. In UK I just found the house, found a mortgage online, got a lawyer who did every thing I needed including deal with the money side and that was it. Simple
Here there are the seller's realtor, the buyer's realtor, real estate attorneys, escrow companies. Seems to be a lot more people looking for a piece of the pie

Hi. I read this post with interest. I'm a Realtor In Ga. The RE laws will vary from state to state. Here in GA the laws are now weighted in favor of the seller making the buyer responsible for far more. In a contract here the buyer warrants that he/she will have the money, will not make a big purchase prior to the close that might affect their ability to buy the property and is responsible for understanding the vagaries of the neighborhood incl. sex offender registry etc etc. In short, the laws leave an unrepresented buyer at some risk if an unscrupulous seller appears. I wouldn't recommend buying in GA without an agent at all. You also say you know the prices in your area - you know the asking prices.....how about the actual selling prices? How much did the seller contribute to closing costs? That info can be important. Here an agent can sign a deal with a seller as a 'transaction agent' just to facilitate the deal for a specific client. The seller only grants the right to a commission on that specific case and that amount would be negotiable.That might be the way to go for you. Call a Realtor and ask his/her advice on CA RE law. He/she might help you avoid an expensive mistake. Believe me, RE is more complex than you might think.

Re: Buying a home in LA without a realtor
 

Wouldn't that be the purpose of seeing the RE lawyer?

Re: Buying a home in LA without a realtor
 

[QUOTE=David Richardson;5145446]Speaking for Colorado:

Sex offendors etc I have no issue with, you should certainly know the area and if the area is for you.
We had our house pre-inspected before we marketed, with the certain knowledge that no matter how thorough something would still be raised, just wanted to have a heads up on anything of consequence.
Selling prices are online, through County web site.
Closing Costs I would have to check, we cetainly did when we sold, but it was in percentage terms nominal.
Trasaction Agents here as well.
I do not think anyone is suggestion he does not need legal advice, just not the 2.8% worth, or whatever it is on CA.

Re: Buying a home in LA without a realtor
 

The Realtor will give you the advice for free as it pertains to the different types of transactions that may be possible. When you arrive at the lawyer's office, the clock is ticking at, what, $350 an hour?

Re: Buying a home in LA without a realtor
 

[QUOTE=Boiler;5146084][QUOTE=David Richardson;5145446]
Speaking for Colorado:
Selling prices are online, through County web site.
Closing Costs I would have to check, we cetainly did when we sold, but it was in percentage terms nominal.

Selling prices may be available online but they won't be there right away. In GA there is often a 45 - 60 day time lag before the sale is recorded. You might need to know the prevailing sales prices sooner.
Re closing costs - a seller can make a major contribution to closing costs and also may have agreed to allowances for new floors and so on and agreed to repairs following inspection etc. These are items are not shared in the public arena. Only the sales price is recorded not the 'below the line' items. To make a good comparison , you need this info. Realtors have it.

Re: Buying a home in LA without a realtor
 

Not harping you, just seeking clarification and curious.

Did you disclose everything which was found on your pre-market inspection? All though pre-market inspections are often a good idea - it can work against a seller per se as all finding then become adverse material facts and subsequently have to be disclosed. If you took care of items, doesn't necessaryily remove your obligations, you also want to provide proof that it was properly corrected.

Sold prices are on the county site; BC is fairly quick with recording its info but it won't show any applicable concessions such as any closing costs, allowances etc. The local MLS now requires such info to be disclosed because such amounts could be factored and considered by an appraiser and be reflected in the appraised value.

The thing with closing costs and seller credit/paying, one should ask the question who is entitled to any tax deduction and did a buyer give a seller an additional deduction?. Verify with an accountant... (that is why you have a copy of the HUD).

You of all people should know that Realtors can not give legal advice/rights. The liability for one (and may be held accountable); also you can be done for practicing law w/o a license.


Buyer Beware. Never assume good faith, verify everything which is said to you and get everything done in writing - it doesn't exist unless its in writing.

Re: Buying a home in LA without a realtor
 

Just remembered one other useful non-commercial site that I used to get the real info on property values is the LA county office of the assessor;

http://assessor.lacounty.gov/extrane...maps/Pais.aspx

Click on 'view property maps and data' on the top left, enter the address and it will tell you what properties sold for in that neighborhood, when the last time the house sold and the price. Never compared it against Zillow.

Another site I saw on 60 minutes recently is Redfin, this site is giving realtors some grief as it cuts them out, can't remember the exact details as I'm no longer in the market, but it's another resource;

http://www.redfin.com/homepage_alt.html

Re: Buying a home in LA without a realtor
 

Bit state specific this one, old bean. Here in AZ, a licensed real estate bod can certainly give legal advice concerning the buying, investing in, and selling of property.

Re: Buying a home in LA without a realtor
 

I think Arizona is the only State with no UPL regulations.

Re: Buying a home in LA without a realtor
 

It has UPL. But the rights of real estate bods are written in to the State Constitution.

Re: Buying a home in LA without a realtor
 

I have done it twice, so first I fixed everything I thought of that may be an issue.

First time around we made up a pack for interested buyers, we included the Inspection report and our comments.

Second time around the Inspector was having a hard time, the Realtor had paid for him to do it as part of his costs.

He managed to find 5 things, mind you one of them was a smoke Detector that had come loose, 5 minutes to right it up and photo, 5 seconds to fix.

Of the remaning items, 2 I will fix, minor issues, one was more of a question that I can not answer and one related to something that was a grey area as far as code is concerned.

But of course any buyer will have their own report commisioned, the inspector has got to find something to justify the fee, I know they will not be deal breakers, or negotiating points.

Re: Buying a home in LA without a realtor
 

[QUOTE=Tarkak9;5148392]Not harping you, just seeking clarification and curious.



You of all people should know that Realtors can not give legal advice/rights. The liability for one (and may be held accountable); also you can be done for practicing law w/o a license.

It is not practising law to tell buyers and sellers about the RE contracts that exist in Ga ( I'm only speaking for GA, remember) The buyer and seller needs to know what type of transactions are available - example; For Sale by Owner. A Realtor needs permission from the Seller to show that home. There is a specific, enforceable contract to allow that. Once agreement is reached to show - one time only or a set number of days - the Realtor can show the property and offer a purchase and sale agreement if the Buyer wants to buy the home. At that point, the Realtor is representing the Buyer and that affords them all the protection GA RE laws provide, including the right to sue the Realtor if they err. If there is a genuine legal question in the sale somewhere, I work for a Broker big enough to have their own legal dept and they would provide counsel. That is quite rare tho' but if you need it...........
I am not saying that you cannot enact a transaction as a Seller or Buyer without a Realtor - it is done about 9% of the time but it is not always the smartest move. Where there are legal problems later - suits re Sellers Property Disclosure etc - they are often where the Buyer went it alone.

Re: Buying a home in LA without a realtor
 

[QUOTE=David Richardson;5149095]Well I am going ahead. I have read through the standard california property sale contract. It looks pretty straightforward. I guess the one area that a realtor could help with but I find it hard to be convinced it's worth almost 20K is negotiating the conditions of sale. ie. who pays closing costs, amount of time to allow for inspections, what the seller will pay for etc. I assume it's up to me to negotiate all this with the seller now? Once its in the offer (which is the contract subject to contingencies) then its binding is it not? Is it just a case of me going through the various contingencies with the seller and coming to an agreement. ie. I will pay escrow, they pay title. They will pay for termite check and to fix any problems like that etc. or am I missing something major here. Of course no realtor is interested in helping me unless I sign up with them. Even my friend who is a realtor still demanded 3% which is just insane I think for just an hour of advice. I have no problem securing a good inspector etc. I have excellent connections with the construction trade. All information is in public domain and seems easy to find online even. I just look up the parcel on the county records website which gives the sq ft (of course there may be undisclosed extensions etc.) parcel and lot number etc.

Re: Buying a home in LA without a realtor
 

Great friend.

In my one experience of buying here, the realtor is really in a facilitating role. Depending on your personality you may find it easy or difficult to negotiate items. Our seller paid for the termite check and work but then some further termite damage was discovered. The realtor actually kind of cocked up there as she rushed into signing it off and there was a dispute on who paid, we had to pay some extra. But most of it seems to be standard forms which the escrow company will go through with you. If you are in an earthquake zone a geological inspection is recommended in addition to a home inspection. As you are already living next door you should have a good idea of any potential pitfalls I should think.