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What Are Three of the Problems of Online FSBO Sites?

November 12, 2011 | Comments: 0 | Views: 146

There are a large number of internet FSBO (For Sale By Owner) sites. Their goal is to have users list their properties for sale, rental units and other real estate requests by users. Buyers and sellers hunt for properties and list their properties on a daily basis for maximum exposure and the best possible results.

There are few controls on listing properties because of the large number of users. The result can be misuse of the site by some users. The most common abuses are:

1. Listing of a property that does not exist so that readers will call or email to the sellers and he can collect their names, email and contact information for a future use. This practice is illegal in some states but it is not enforced by the websites because of the inability of the website owners to check every property's ownership.

The easiest way to overcome this potential problem is for the investor looking to buy the property, to look in the public record before calling on the property. This takes a few seconds but can be very cost effective if a seller is trying to take advantage of the investor.

2. A buyer may make on offer on a property and send a cashier's check with a larger deposit than originally requested by the seller. This buyer may then request that the seller send the "overage" so a friend to buy furniture for the property or rental unit so he can move right in when he comes into town. The problem is the cashier's check is drawn on a foreign bank, is counterfeit and can take weeks for the landlord's bank to tell him of the problem. The money he wired to the prospective renter is lost.

3. The advertiser may do a "bait and switch" by showing a property that is not the actual property that is for sale. An investor buying a property off one of these websites should always have a local attorney hold any escrow deposit and have the same attorney or a closing agent do the preliminary title work to determine if the buyer will get a marketable title at closing. It is possible for a buyer to get an insurable title that is not marketable and the property will have to go through a quiet title action to clear up certain title defects.

In summary, if you are going to buy a property from an internet site, no matter how big they are, be careful to do the title work after you know you can get it and before you put any deposit down. Always have an attorney or closing agent do this title search including getting lien letters before you close and have all your money in the property at risk.

Dave Dinkel has over 35 years experience in real estate investing which has given him a unique perspective into the real estate market. is the place to interact with Dave Dinkel. You can read some of the latest informative Real Estate articles he has written. Here you can discover and educate yourself on topics ranging from foreclosure, For Sale By Owner(FSBO) Sales, Credit and much more.

Source: EzineArticles
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