One of the most common questions I get from people looking at selling their home privately concerns potential legal problems that could arise from selling without using an agent. One of the biggest misconceptions out there is that sellers think that legal problems are inevitable. After personally overseeing many private sale transactions, I have never encountered a situation where a seller had legal problems because they were selling privately. In fact, sellers can avoid all problems by working with an experienced lawyer every step of the way.
Tannis Waugh is a lawyer in Toronto who has worked extensively with both private home sellers and sellers using a traditional agent. Here are her thoughts on three of the most common questions sellers have when making the decision to sell privately:
Q: Is a seller more at risk selling privately vs. selling with a traditional agent?
A: With respect to legal risk, usually legal problems will not be any different selling privately than with a traditional agent, as long as the seller has the agreement reviewed before it is firm and takes the advice of their lawyer on any necessary due diligence.
Q: I've heard real estate agents say some troubling things, even saying it was illegal for a seller to sell their home privately. Is this true?
A: It is not illegal to sell your own home without representation from an agent, but sellers do require a real estate lawyer to complete the transaction in Ontario.
Q: What about all the paperwork that agents typically take care of?
A: "Paperwork" is a fairly broad term. With respect to the standard form agreements used by agents, lawyers also have access to these standard form agreements and are able to assist with preparing an offer by taking instructions from their clients.
The most important aspect of working with a lawyer is ensuring that the lines of responsibility between all parties involved are clear. Your lawyer should provide you with an extensive, clear and concise retainer agreement setting out why they are being retained so you clearly understand what your role will be in the transaction. As with anything you are not familiar with, it is always good to seek advice from an expert and educate yourself before making any decisions.
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