Guide to the Michigan For Sale By Owner

For Sale By Owner Sign

When you consider buying or selling a home, one of the first decisions you need to make involves whether to use a real estate agent. Since most buyer and seller agents use exclusive agreements which limit your rights in the sale or purchase of your home, it’s an important decision.

For Sale By Owner transactions, which do not involve a real estate agent, are popular in Michigan, particularly in the Washtenaw County area. But before you venture into a FSBO sale or purchase, you should understand the responsibilities of buying or selling a home without a real estate agent.

Michigan Requirements For Real Estate Transactions

For both buyers and sellers, a real estate transaction is subject to numerous federal and state laws, regardless of whether you use a real estate agent. The sale contract and property transfer require detailed legal documents. When a real estate agent handles a transaction, the agent prepares many of those documents. So, if you don’t have an agent, you are responsible for preparing and reviewing the documents.

If you’re considering a FSBO home sale or purchase, one of your first steps should be consulting with an experienced Michigan real estate lawyer. Your lawyer prepares the necessary legal documents, reviews documents from the other party, and provides you with legal advice. Your attorney also provides assistance with all aspects of the process, including contract contingencies and amendments and review of title insurance policy and closing documents, all the way through the closing and transfer of the property.

Unlike real estate agents, real estate lawyers do not charge a commission based on the purchase price to assist a buyer or seller — they charge a flat fee to handle the entire transaction. Your attorney can assist with the whole process, including preparation and review of all necessary documents and compliance with all legal requirements.

Purchasing a Home Without a Real Estate Agent

If you are buying a home, the property you want may be listed for sale by a real estate agent. If the seller has an agent, that agent does not represent you — the agent represents only the seller in the transaction. If you want an agent to represent you in the transaction, you should use a different agent.

If the home you want to buy is listed as a FSBO sale, using a real estate agent to buy the home may have disadvantages. First, some buyer’s agents avoid showing buyers FSBO properties for a variety of reasons. Secondly, if an agent represents you for a purchase of a FSBO home, the seller will have to pay your agent a commission fee, usually 2 to 3% of the sale price, which significantly undercuts the seller’s primary reason for using a FSBO sale in the first place. Most likely, the seller will factor that commission into the negotiated price, so you will pay more for the property.

If you consider buying a FSBO property, you should meet with a lawyer before you even initiate discussions with the seller. Your lawyer will explain the process, provide all the documents you need, review the seller’s documents, and assist with all the steps through closing.

You may decide to use an agent to help you find a home and negotiate the purchase, or you may decide to assume those responsibilities yourself. In either type of purchase, your best strategy as a buyer is to have a lawyer review all the documents relating to the transaction and assist you through the process. A real estate agent cannot give legal advice to either a buyer or seller. Only a licensed attorney can provide legal advice. It should also be noted that most sales contracts include specific language that states “All parties are advised to seek the advice of an attorney.”

Buying a home is a huge investment. You should make sure all your legal rights are protected.

Selling a Home FSBO Without a Real Estate Agent

If you sell your home in a FSBO transaction, you may save the 5 to 6% agent commission, but you undertake significant responsibilities — including duties relating to all the legal requirements for a real estate transaction. In Michigan, that includes compliance with the Seller Disclosure Act, which requires a seller to provide a Seller’s Disclosure Statement to a potential buyer prior to signing the sales agreement.

Failure to comply with the Michigan Seller Disclosure Act or other legal requirements can have significant consequences, including cancellation of the sale or a civil court action for damages. Before you undertake a FSBO sale, you should talk with an experienced Michigan real estate attorney to make sure you understand all your legal responsibilities.

In addition, a seller must also comply with Federal law and provide a potential buyer of a residential property with a Lead Based Paint Disclosure form regarding the presence of lead-based paint in the home.

Talk With an Experienced Ann Arbor Real Estate Attorney About Buying or Selling a Home Without an Agent

In my real estate practice at Ager Law Office, I assist both buyers and sellers in For Sale By Owner / FSBO transactions. For a reasonable flat fee, I provide a full explanation about how FSBO works and assist clients through the whole process from start to finish, including preparation and review of the documents and forms required by law. I also assist clients with sales and purchases involving a real estate agent.

From my Ann Arbor office, I serve clients throughout Washtenaw County. To talk with me about a purchasing or selling your home in a FSBO transaction, call (734) 649-0784, send an email to, or use the online contact form.

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