In the state of Alabama, homeowners can choose to sell their own properties as "sale by owner" without a registered agent, but compliance laws are strict. A private individual may sell his own property or represent his spouse, child or parent in the sale of property if so agreed.
In the state of Alabama, homeowners can choose to sell their own properties without a registered agent, but compliance laws are strict. A private individual may sell his own property or represent his spouse, child or parent in the sale of property if so agreed. In order to complete a legal sale by owner in Alabama, you will need to meet the following requirements.
Advertising a Property for Sale
Homeowners must meet minimum standards in advertising any property for sale, including:
- Making honest representations and not deceiving or misleading the public;
- Identifying themselves as a licensed broker or salesperson if that's their professional qualification. Conversely, sellers cannot misrepresent themselves as licensed brokers if they are not.
Fees Cannot Be Charged
If a private person is not a licensed broker, she cannot charge a fee in a real estate transaction. The only money that changes hands should be for the agreed value of the property.
Full Disclosure of Information
The homeowner must not knowingly engage in misrepresentation, fraud or dishonesty in the sale of a home. Buyers are responsible for two-thirds to three-quarters of all lawsuits in Alabama, bringing claims against the physical condition (such as undisclosed structural issues) of the property after closing.
The buyer is required to inspect the property for sale before closing on an agreement; however, he can also opt out – in this case the buyer must fill out, sign and file an Inspection Waiver form. Otherwise, full disclosure includes:
- The seller providing a Property Condition Disclosure Statement
- The buyer reciprocating with a Buyer's Acknowledgement Statement
In Alabama "buyer beware" governs the law, so it is up to the buyer to be fully satisfied with the condition of property before purchasing. This does not apply to new developments which carry a warranty, or to health and safety issues. In situations in which the prospective buyer asks the seller a direct question, the question must be answered completely and honestly in order for the "buyer beware" burden to stand.
Handling Funds Properly
Accounting records of all money changing hands must be kept. In the process of the sale, all money received must be declared and deposited in a federally insured account with an Alabama bank. The funds must not be co-mingled with personal money before the sale is complete. It is also necessary to keep detailed records of all payments, including the date of those payments and who made them, for a minimum of three years.
The seller must also not participate in any effort to deceive a lender, like a bank, by making false representations about the nature of the property or the transaction.
- for sale by owner image by dead_account from Fotolia.com