How do you buy a piece of land when it is for sale by owner?

How do you go about buying property when it is being sold without a realtor. What do you do and how do things get organized (ex. the closing etc...) Also do you have to pay tax on the property when you purchase it? And, how much (roughly) are closing costs?How do you buy a piece of land when it is for sale by owner?
I recommend that you hire an attorney who specializes in real estate to provide the contract and write the offer for you.





Do not use one of those stupid legal forms that they sell at the stationary store. Those things are worse than worthless they can actually do a great deal of damage and cost you tens of thousands of dollars.





For example virtually all of those contract forms that I have seen use the passive removal technique for contingency removal.





Whatever you do NEVER NEVER NEVER NEVER NEVER NEVER NEVER use passive removal for your contingency removal.





Always insist on active contingency removal. Only yor attorney can write a contract with active contingency removal.








The realtors all use psssive contingency removal. They do not even know that there is such a thing as active contingency removal.





If you do not know the difference between active contingency removal and apssive contingency removal you definitely need to talk to an attorney who specializes in real estate.





Do not ask a realtor because they do not know the difference.








If you accidentally wind up with passive contingency removal you could lose tens of thousands of dollars. That will be an extremely expensive mistake to make.





Do not make that mistake whatever you do.





That is also a reason why you do should never use a realtor or real estate agent.





Most realtors and real estate agents that I have met love passive contingency removal because it is much easier and much more profitable for them.





Many of the realtors that I have met would like to pretend that active contingency removal does not exist. They certainly will not tell you about it.





In fact many of them are so poorly trained they do not know that active contingency removal is even a possibility.





All they have ever been trained in is passive contingency removal.





The realtors do not even know that other possibilities such as active contingency removal exist.





Essentially do not use the standard real estate forms becuase virtually all of them use the language of passive contingency removal and you do not want that under any circumstances.








Next I recommend that you open escrow with a title company that you trust or a title company recommended by your attorney. Whatever you do, do not accept the title company, if any that is chosen by the seller.





Remember you may have to cancel your offer and demand that your deposit be returned. Only deposit your check for the deposit with your title company for them to hold in thier trust account.





Under no circumstances do you give any part of your deposit to the seller even though the seller may demand it.





Find another property if necessary if the seller demands that you give him the deposit directly.





Many years ago when I first started investing in real estate I was in contract with a man selling his own property. He demanded that I give him my deposit as a gesture of my good faith as if I possibly might somehow not be trustworthy.





It turned out that it was the seller who was not trustworthy. I had to withdraw my offer because the seller had so many judgments against him that he could not deliver clear title.





I demanded my deposit back. Unfortunately the seller now had my deposit and would not give it back to me.





The seller could not give my deposit back to me because the seller had already spent my deposit.





The seller could not deliver good title to the property because he had several judgments against him that were more than the property was worth.





Essentially the seller got a little traveling money out of me and skipped town.





If anyone accuses you of not being trustworthy that is a red flag because that is what crooks do to steal money from you.





Remember only put your deposit in a trust account with your title company.





The receipt that you get from your title company is your proof that you have put your deposit in escrow.





Next you need inspection reports. If this is a piece of land in a rural area you will probably need to have a survey done to determine exactly where the property lines are.





Even in some if the older parts of Cupertino, California where I own some investment property I have had to survey the boundary lines and I did discover in one case in particular the boundary line was nowhere near where the seller said it was and it was a much less desirable piece of property because of that.





Next, if the property is on a well you will need to do a well report to determine the amount of water the well wil provide when you are pumping the well very hard. You will also need to do an analysis of the water to check for bacterial or chemical contamination.





If the property is on a septic system or will need a septic system you will need a report of the septic system or a test to see if the dirt has sufficient absorbent capacity to support a septic system.





If you are planning to build a new house you will need a geologic report where they take core samples down to bedrock to determine what kind of a foundation that you need or even if the property is buildable at all.





We have several places in San Jose and Cupertino that are on deep landslides and these properties are essentially unbuildable because it is impossible to build a foundation that will support a house and keep it from sliding down the hill.





You do not want to buy a piece of land only to find out later that it is unbuildable.





If you are buying an existing structure you will want a roof inspectionl, property inspedtion of the foundation, plumbing, electrical, appliances and fixtures.





You will also want a good pest control report that will determine the presence or absence of termites, other wood destroying insects and especialoly dry rot.





You may also want a mold report if there is evidence of water damage.





There are other reports that you can get such as tests for Radon gas, lead paint, and other such items.





With respect to lead paint. Lead paint was outlawed in 1978. If the building was built about that time or before there is a good chance that it has lead paint. If it was built much after that time it probably does not have lead paint. That will save you the aproximately $400 cost of a lead paint report.





If you are concerned about the presence of lead paint do not buy a house that was built prior to 1978.





With repect to the value of the property I recommend that you hire your own appraiser to appraise the property for your protection to make certain that you do not pay too much.





I strongly recommend that the appraiser be a member of the Appraisal Institute.





If you hire a good appraiser who is approved by the lender the lender will often accept that appraisal as their own.





It is helpful if you do not have two different appraisal reports with two different values.





At the very least hav your appraisal done first and negotiate the reduction in price with the seller before the lender has their own appraisal done.





Make absolutely certain that the lenders appraiser has a copy of the contract INCLUCING YOUR NEGOTIATED PRICE REDUCTION WITH THE SELLER AND A COPY OF YOUR APPRAISAL.





It is much more likely that in those circumstances the lender's appraiser will supportthe appraised value as determined by your appraiser.





this is expecially true if your appraiser is already one of the most highly respected appraisers in the field as all members of the Appraisal Institute are..





Even if the lender hires their own appraiser as they will in most cases, it is very important that you hire an appraiser to protect you from paying too much and that the appraiser knows that is the purpose of the appraisal, not for the lender.





If the lender decides to accept the appraisal done by your appraiser that is wonderful.





In most cases the appraisal that is done by your appraiser will show a lower value than the appraisal that is done by the lender's appraiser.





When your appraisal comes back and it is lower than the amount that you offered the seller you are to give the seller two choices.





Either reduce the contract price to that amount appraised by your appraiser (not the lender's appraiser) or sign a release that authorizes the title company to return your deposit to you and relieves you of your oblication to purchase the property.





The same is true when the inspection reports come back. I recommend that you decide which items must be repaired if you are to buy the property. Personally I just tell the seller to fix everything on the reports so I do not have to worry about it, but I can see that there are often some very minor items on these reports.





But at the very least I recommend that you get the major items fixed unless the seller is giving you a very good deal on the property.





If the seller refuses, then again withdraw your offer and direct the seller to sign papers that direct the title company to return your deposit to you and relieve you of your obligation to purchase the property.





You should expect that you will actually ahve to withdraw several offers before you actually are able to find a seller who will agree to all of your terms and actually close escrow.





Also before you get into contract with the seller you need to know the amount of the outstanding obligations on the property. If it appears that the outstanding obligations are more than the seller will net from the sale I recommend that you not get involved with the property.





Essentially that is a short sale and the lender must agree to accept less than the amount owed to close the sale.





My experience with lenders on short sales has not been good. Essentially the lenders will not accept enough of a decrease in the amount that they are paid to make it worth your while to buy the property.





If the seller does not know how much is owed, your title company will tell you when they run the preliminary title report. that will tell you about any lHow do you buy a piece of land when it is for sale by owner?
Kelly, Good start asking questions. Everyone in the US is able to purchase property with or without a professionals assistance. Sale requirements and costs will vary by State and sometimes County.





I suggest starting with a Title Company in your area. They usually offer assistance to buyers and sellers for a fee. They will be able to give you more information and advice on making your purchase and can let you know if a lawyer is required in your State.





Before speaking with the owner of the property, I suggest speaking with at least 3 real estate professionals familiar with land purchases. You will also need to verify the zoning of the piece of property and setbacks of any buildings. If this is a rural setting, you will also need to verify utilities can be provided to the property before purchasing. Make the homeowner provide and if needed apply for all permits. They are the ones stating the property is buildable, make them prove it with paperwork.





Good luck in your purchase.
dont buy it.
Actually you are a perfect candidate for a Realtor to help. You know nothing about how to go about buying the property. Realtors are ready made for those that know nothing about how to buy and sell property. Even those that know will use realtors at times too. I sold one this year with an agent. With their contacts and MLS listings they can give you a larger picture.





Barring that, look in the advertisements in the newspaper, and when you find what you want, get a lawyer to help with contracts, banker for loan, and title company for closing.
just call the owner
You contact the person selling the land and try to negotiate a price. There are contracts to purchase all over the internet for free, or if you are going to get a mortgage or bank loan for the purchase, you may be able to get a mortgage broker or loan officer to help you with the contract.





The laws may vary from state to state, but you are probably entitled to ask the seller to provide you with a recent survey or have one done at their expense prior to the sale. You will definitely want this in order to be sure of the property boundaries and to help you know what you are purchasing.





As soon as both you and the seller have agreed to a price, the buyer will likely set up a closing date. There are certain things that will have to happen prior to closing--the title company will research to make sure that the title is clear (there are no other owners or encumbrances against the deed). You may also want to get some assurances about any deed restrictions to the property, as well as any environmental concerns you may have.





If you are really a novice at real estate, you might want to consult a real estate attorney, but there will be an attorney handling the title work at closing. They will prorate the taxes for the year based on the calendar date of sale, and divide the taxes up between the buyer and seller at closing.





Closing costs are somewhat negotiable, and some of them are tax-deductible. You may want to make your offer somewhat flexible, with a low-ball price where you pay more of the closing costs, and a higher price where the seller pays more of the closing costs. Since some of the closing costs are a percentage of the purchase price, it is to your advantage to get the sales price lower especially if you will be paying the closing costs. It is perfectly reasonable for you as the buyer to go through the list of closing costs with the buyer and find out which they are willing to pay. Someone at the title company you plan to use should be able to give you some information on closing costs statements for your state and what is customarily paid by the buyer and the seller.





The seller is likely to be ready to take the lead on organizing the closing, but you have every right to choose the title company, ask whatever questions you need to to understand the transaction completely, and to be represented by counsel if you feel it is necessary. You could even hire a realtor to represent you, but remember that they will charge a percentage, which will drive the price up.
First you get a lawyer who does real estate. S/he will know the answers to all your other questions.
Put the question to a real estate attorney who is the best in his field. Get the proper answer before you commit any funds.
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It has books on buying and selling also check out legal mart or quicklaw for help with conveyancing some are up gradable services