Selling my home to my tenant

5 years ago

Good afternoon everyone!

This is my first time posting here, so I really appreciate any advice and help.

I am in the military and I bought my first house in 2015 for 180,000. I bought because I liked the idea of owning something instead of renting and putting my money towards generating some equity. I received new orders this past February and since moving, I have rented out the house to a friend, who said they wanted to stay there for three years (that would have been perfect). Last week I got a message that they want to now buy the house for 190,000. I have 169,000 left on the mortgage and I am trying to figure out whether it is worth it to just sell. Obviously I don't need a real estate agent in this situation, I think I only need the real estate attorney for writing the contract, etc. However, my friend said that she has a real estate agent, because they were initially thinking of buying something else in the area. Would I still be responsible to pay her real estate agent? or should I just ask her not to use the agent to save me having to pay the commission. It doesn't seem right for me to pay for real estate agent services when I am going to be selling to my tenant/friend, especially when my profit is pretty limited.

Lastly, I am looking to sell instead of continuing to rent it out because I just don't want to deal with the stress of not being in the area anymore and having to deal with maintenance from afar, and I do not believe I will ever be living in this area again.

Thank you in advance for any and all help regarding my dilemma. Have a great day!

Featured Answer

weedyacres

5 years ago

You don't need an agent, whether yours or theirs. A lawyer will do everything you need, and for way less money than a realtor would.

Your tenant may choose to pay their agent something, but that's between the 2 of them.

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Comments (10)

tiggerlgh
5 years ago
What is the market value of the house?
User
5 years ago
last modified: 5 years ago
We dont have enough info. Where are you located.

Average home price inflation has been about 5% over the past few years. But actual location will not be "average." But lets say it was. Your home would be worth $208,000.

As for the realtor, typically when a real estate agent brings a buyer to a fsbo, the owner will pay a commission. But this agent didnt bring you the buyer...or did they?

Find out what your home is worth today. Add 2%. Offer the agent 3% to close the deal. Everyones happy.
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HU-22236253
Original Author
5 years ago
the home is located in Virginia Beach, va. I had the Home evaluated and it came back right at 190, so I think it’s a fair price. The realter agent did not bring me or the agent, they were just hired by my tenant to look at other houses. Why do I need to pay their agent when they didn’t do anything for this deal?
Linda
5 years ago
An agent does a lot more than bring you a buyer, but If you feel like you dont need an agent, and your buyer wants one, tell him he can have his own agent that he will need to pay her. (You dont have to pay his agent, make that part of your deal). I would however, get an appraisal done to make sure you are selling the house for market value. It could be worth more.
sushipup1
5 years ago
Just remember that the agent will be working for the buyer and will NOT have your interests at heart.
homechef59
5 years ago
You need a real estate attorney. They will guide you through the process. You owe no money to the purchaser's agent. You have no contract with them nor any implied contract.

You said you were military. You have access to your unit's JAG officer. Find them and talk to them. They can be helpful. If you financed the home using the VA, the loan is assumable by your buyer. If your buyer is in the military, you may want to explore that option. Just be certain they will be assuming liability for the loan.

Ultimately, you need a real estate attorney. The good news is your buddy has looked around the area and has determined that they would like to stay in your property.

You may want to go ahead and get a handle on valuation by getting an appraisal as part of the purchase contract. Your real estate attorney can help with this. An appraisal and knowing the valuation will make setting the sales price in a reasonable range. There won't be any surprises when the buyer goes to finance.
function_first
5 years ago
Two years ago we sold a rental home to the tenant. We used a real estate attorney, and she used her own attorney, no realtors involved. Though int he end we feel good about having sold to her, we do regret that we didn’t involve our attorney first instead of verbally discussing price with her, etc.. The tenant took well over a month to get back to us about whether she wanted to buy or not and we weren’t sure what our options were in terms of listing it, etc with that offer to sell to her just sort of “hanging" out there.
midcenturymodernlove
5 years ago
last modified: 5 years ago
I would insist on using an attorney to close a personal deal like that between you and your tenant, and tell him that is the only way you will sell at this time. Otherwise, you will put your house on the market in spring (or when his lease ends). Do what Function first above said.

No need to pay 6% of the sales price of the house to some agent to fill out forms. Or even 2 or 3 percent, as that is still thousands of dollars. An attorney will be less expensive than an agent and he can actually legally protect you.
lafdr
5 years ago
last modified: 5 years ago
In some states, like mine, an attorney is not used in a real estate sale. Just a real estate agent and a title company. If you do not use a real estate agent, you still use a title company. The advantage of using the agent is that they know what forms need to be done and the procedures to make the sale happen. The down side is that they are representing the buyer not you. But on a straightforward sale, this would not scare me away. You are saving money by selling to the tenant since you have no lost rent and no need to prep the home for sale to a different buyer.

Selling my home to my tenant

weedyacres

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tiggerlgh

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Selling my home to my tenant

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