To sell a house by owner, you take on the paperwork a listing agent would normally handle: the federally required lead paint disclosure, your state’s property condition disclosure, the purchase agreement, title and mortgage payoff work, the MLS listing, and the closing documents themselves. You save the listing commission (typically 2.5% to 3% of the sale price) and accept the legal exposure that comes with being the only professional on your side of the table. The steps below cover what you need, roughly in the order you need it.
Start With the Required Disclosures
Two disclosure obligations apply to nearly every private home sale in the United States. One is federal, one is from your state.
If your home was built before 1978, federal law requires you to give the buyer a lead paint disclosure before they become obligated under any contract. You must hand over a lead hazard information pamphlet, disclose any known lead paint or lead hazards, share any inspection reports you have, and give the buyer at least ten days to arrange their own lead inspection unless you both agree to a different window. Skipping this step exposes you to civil penalties per violation (the base statutory cap is $10,000 under the Toxic Substances Control Act, though EPA adjusts that figure upward for inflation each year) plus liability for up to three times the buyer’s actual damages.1Office of the Law Revision Counsel. 42 USC 4852d – Disclosure of Information Concerning Lead Upon Transfer of Residential Property Of all the paperwork in a private sale, this one carries the sharpest teeth.
Nearly every state also requires a property disclosure statement where you describe the condition of the home: roof age, foundation problems, water intrusion, past insurance claims, and similar issues. A handful of states make this optional, but the overwhelming majority treat it as mandatory. These forms are usually available through your state’s real estate commission website at no cost. Fill them out honestly. Understating a known defect to close faster is the fastest route to a lawsuit after closing.
HOA Resale Package
If your property belongs to a homeowners association, most states require you to provide the buyer with a resale certificate or disclosure package. This bundle typically includes the HOA’s governing documents, current financial statements, any pending special assessments, and the rules that bind the property. The association prepares it, not you, but you pay for it. Fees generally range from $75 to $375 depending on the state and the management company. Order it early, because some associations take two to three weeks to produce the package, and a delay here can push your closing date.
Write the Listing Without a Fair Housing Problem
This is the area where private sellers get into trouble most often, usually without realizing it. The federal Fair Housing Act prohibits discriminatory advertising in the sale of housing based on race, color, religion, sex, disability, familial status, or national origin.2Office of the Law Revision Counsel. 42 USC 3604 – Discrimination in the Sale or Rental of Housing
The Act does include a narrow exemption for single-family homes sold by an owner without a broker, provided the owner doesn’t own more than three single-family houses at once. Here is the catch that matters for your listing: that exemption disappears the moment you publish any advertisement that indicates a preference based on a protected class. The statute explicitly conditions the exemption on selling “without the publication, posting or mailing…of any advertisement or written notice” that violates the anti-discrimination advertising rule.3Office of the Law Revision Counsel. 42 USC 3603 – Effective Dates of Certain Prohibitions In plain terms, every word in your MLS listing, yard sign, and social media post must describe the property, not the buyer you want.
Phrases like “no kids,” “perfect for young professionals,” “English speakers preferred,” or “close to [specific house of worship]” all risk a fair housing complaint. Stick to bedrooms, bathrooms, square footage, and neighborhood amenities. If you wouldn’t see it in a professional agent’s listing, leave it out of yours.
Draft a Solid Purchase Agreement
The purchase agreement is the most important document in the transaction. It binds you and the buyer to a price, a timeline, and a set of conditions. Every other step flows from what this contract says.
At minimum, the agreement needs:
- The legal description from your deed (lot-and-block or metes-and-bounds), not just the street address. The street address identifies the property for the mail carrier; the legal description identifies it for the recorder’s office.
- The purchase price and the earnest money deposit, which usually runs 1% to 3% of the price.
- Contingencies that let either party walk away, such as a failed inspection, a low appraisal, or the buyer’s inability to secure financing, with a deadline on each one.
- The closing date and the possession date. These aren’t always the same. Decide whether the buyer takes possession at closing or after a rent-back period.
- A clear list of fixtures and personal property included in the sale. If the refrigerator, window treatments, or a storage shed stays, say so explicitly. Ambiguity here causes more post-closing disputes than almost anything else.
State-specific purchase agreement forms are available through real estate attorney offices and some state bar associations. Using a generic template from the internet is risky because it may not comply with your state’s disclosure timelines, default remedies, or escrow rules. A real estate attorney can review or draft the agreement for a few hundred dollars, and on a transaction worth hundreds of thousands, that cost is easy to justify.
Order the Title Report and Mortgage Payoff Early
Preliminary Title Report
Order a preliminary title report through a title company as soon as you decide to sell. The report reveals any liens, easements, judgments, or other encumbrances attached to your property. Discovering a forgotten contractor’s lien or an old second mortgage after you’ve accepted an offer creates delays and kills deals. Title companies generally charge a few hundred dollars for the preliminary report, and the cost often folds into the title insurance premium at closing.
Mortgage Payoff Statement
If you still owe money on the home, you need an official payoff statement from your mortgage servicer showing the exact balance due on a specific date, including accrued interest and fees. Federal regulation requires your servicer to provide this within seven business days of a written request.4eCFR. 12 CFR 1026.36 – Prohibited Acts or Practices and Certain Requirements for Credit Secured by a Dwelling Exceptions exist for loans in bankruptcy or foreclosure, reverse mortgages, and natural disasters, but for a standard sale the seven-day rule applies. Payoff amounts change daily as interest accrues, so the statement will specify a good-through date. Request it close enough to closing that the number is still current when you reach the table.
List the Home Where Buyers Will Find It
Flat-Fee MLS
The most effective way to reach buyers is a flat-fee MLS service. These companies enter your home into the same Multiple Listing Service database that licensed agents use, and the listing syndicates from there to the major real estate search portals. Flat-fee MLS services typically charge a one-time fee of $100 to $500 depending on the package and your market. You’ll need accurate square footage, bedroom and bathroom counts, lot size, tax parcel number, and good photos.
Professional real estate photography generally costs $195 to $600 depending on home size, and a 3D virtual tour adds another $200 to $800. Neither is mandatory, but listings with professional photos consistently sell faster and for higher prices than those with phone snapshots. If you’re saving thousands by not paying a listing commission, spending a few hundred on photography is one of the smartest reinvestments you can make.
Buyer-Agent Compensation After the NAR Settlement
Since the 2024 NAR settlement took effect, MLS platforms no longer display offers of compensation from sellers to buyer agents.5NAR. 2026 Summary of Key Professional Standards Changes That doesn’t mean you can’t offer compensation; it means the offer won’t appear in the MLS listing itself. As a private seller, you have a few options: state in your listing remarks that you’re willing to negotiate buyer-agent compensation, offer a flat fee or percentage directly to any agent who brings a buyer, or let the buyer handle their own agent’s fee under a buyer-broker agreement. Many FSBO sellers still offer some buyer-agent compensation because roughly 85% to 90% of buyers work with an agent, and excluding those buyers shrinks your pool significantly.
Get Through Closing
Open Escrow and Confirm Title
Once you accept an offer, the closing process begins with opening an escrow account through a title company or escrow agent. This neutral third party holds the buyer’s earnest money and coordinates the flow of funds. The title company then performs a final title search to confirm no new liens have appeared since the preliminary report and issues a title insurance policy protecting the buyer and their lender against future title claims.
What Sellers Pay at Closing
Even without a listing agent commission, you’ll still pay closing costs that typically range from 1% to 3% of the sale price. These include title insurance premiums, escrow fees, prorated property taxes, and recording charges. In the roughly three dozen states that impose a real estate transfer tax, you’ll also owe a percentage of the sale price to the state or local government. Transfer tax rates vary widely, from as low as 0.01% in some states to over 1% in others, and about 14 states don’t charge one at all. Your title company will calculate the exact amount on the settlement statement.
Guard Against Wire Fraud
Wire fraud targeting real estate closings has become disturbingly common. Scammers monitor email chains, then send fake wiring instructions that look nearly identical to your title company’s real ones. The Consumer Financial Protection Bureau recommends identifying two trusted contacts at the title company or escrow office before closing, confirming all wiring instructions by phone using a number you looked up independently (never one from an email), and never sending financial information over email.6Consumer Financial Protection Bureau. Mortgage Closing Scams: How to Protect Yourself and Your Closing Funds If any wiring detail changes at the last minute, treat it as a red flag and verify by phone before sending anything.
Signing, Recording, and Getting Paid
A final walkthrough happens shortly before closing so the buyer can verify the property’s condition and that any negotiated repairs are complete. At the signing appointment, you execute the deed transferring ownership. The deed must be signed before a notary public who verifies your identity. Notary fees are regulated at the state level and are typically a nominal charge per signature.
After signing, the deed goes to your county recorder’s office for official filing. Recording fees vary by jurisdiction but generally run from about $15 for the base fee up to $100 or more once state and local surcharges are added. Once the deed is recorded, the transfer is part of the public record. The escrow agent then disburses your net proceeds, minus the mortgage payoff, closing costs, and any credits to the buyer, by wire transfer or certified check.
Taxes After the Sale
If you owned and used the home as your primary residence for at least two of the five years before the sale, you can exclude up to $250,000 in capital gains from your taxable income. Married couples filing jointly can exclude up to $500,000, provided both spouses meet the use requirement and at least one meets the ownership requirement.7Office of the Law Revision Counsel. 26 USC 121 – Exclusion of Gain From Sale of Principal Residence For most homeowners selling a primary residence, this exclusion wipes out the entire capital gains tax bill. If your gain exceeds these limits, the excess is taxed as a long-term capital gain.
The person responsible for closing (usually the title company or settlement agent) is generally required to file Form 1099-S reporting the sale proceeds to the IRS. There’s an exception: if your sale price is $250,000 or less ($500,000 for married couples filing jointly) and you certify that the full gain is excludable under Section 121, the closing agent doesn’t have to file the form.8Internal Revenue Service. Instructions for Form 1099-S Proceeds From Real Estate Transactions Even when the form is filed, it doesn’t mean you owe tax; it just means the IRS knows about the sale. You report it on your tax return and claim the exclusion there.
These rules apply to a primary residence. If you’re selling a rental or investment property, the Section 121 exclusion doesn’t help, and different rules (including the deadlines for a Section 1031 like-kind exchange) come into play. If you’re a foreign national selling U.S. real property, the buyer is required to withhold 15% of the sale price under FIRPTA, which is a deposit against your actual tax rather than a final bill.9Internal Revenue Service. FIRPTA Withholding
When You Need an Attorney
About a dozen states require a licensed attorney to conduct or supervise the real estate closing. If you’re in one of those states, you don’t have a choice. Even where attorneys aren’t required, hiring one to review the purchase agreement and attend closing is worth considering for a private sale. An agent-assisted transaction has two professionals catching errors in the paperwork; in a FSBO sale, you’re the only one on your side of the table, and a missed contingency deadline or a poorly drafted contract can cost far more than a few hundred dollars in legal fees.
The case for an attorney is strongest when the sale involves unusual circumstances: a property in a trust or estate, seller financing, unresolved liens, a divorce, or a buyer asking for creative terms. In straightforward sales with a conventional mortgage buyer and clear title, some sellers handle closing without counsel. The margin for error in a FSBO transaction is thinner than most people expect, and the cost of fixing a mistake at closing almost always exceeds the cost of preventing one.