Buying A House From A Friend Without A Realtor

So you want to buy a house from a friend but they do not want to involve a realtor because of the process and extra fees they would have to pay (or maybe you feel this way), regardless of your feelings or thoughts about the issue it is not an advisable idea to mix business dealings and close relationships (like with friendships or with family members.) You as the buyer may be taken advantage of because of the nature of the relationship or you maycstart using emotions instead of a rational mind to buy the house. Either way it is not illegal to buy a house without the presence or influence of a realtor. Here’s more on that.

Table of Contents

How To Buy A House From Your Friend Without A Realtor

So you have thoroughly read and considered the reasons mentioned above in this article but you still want to purchase the house your friend is selling. That’s alright, here are the steps you need to take to ensure the process runs smoothly.

Apply For A Mortgage

A mortage is a loan you take out on property or land that then allows you the option to pay in a manner you can afford. You need to get ‘pre-approved’ by the bank you use so that you are not buying a house you cannot afford. This will also show your friend that you are serious about purchasing their house.

Get The Rundown On The Neighborhood

Your friend might be a great person (that’s probably why you’re friends with them.) However the neighborhood they live in may not be so great. As such you need to do some deep research into the state of the neighborhood and whether it is suited to your needs. You should know how much properties in the area sell for and if there’s access to fundamentals like public schools, public transportation, etcetera (if you just so happen to be in need of these things.)

Ask Your Friend For A Seller’s Disclosure

This is a list of known issues about the house. Which can help set the tone for the final price of the house and any remodeling that you may want to do on the house. A seller’s disclosure may include things like; the structural issues of the house, utility problems, presence of potentially harmful substances, termit damage, etcetera.

Get A Lawyer And An Inspector

If the inspector notices any issues with the property that your friend did not mention in the seller’s disclosure then you can use that opportunity or better yet your lawyer can use this opportunity to negotiate the price of your friend’s house to a much more considerable one. The presence of any witnesses (not other friends) can be very helpful in the long run.

  • After this you can then finalize the paperwork and finance the house you just bought from your friend if your mortage is approved by the bank.

Reasons You Should Not Buy Your Friend’s House Without A Realtor

It Is Far More Complicated Than You Think

Realtors or real estate agents are people who buy and sell houses for a living, so as much as you would not want to involve a realtor, you kind of need to. And this is especially advised if it just so happens that you are buying a property (house) for the first time. Your affiliation with the seller (which is what your friend will be) will not matter in the long run if it just so happens that the house was a bad investment. This is where a realtor would come in handy, to not only help keep things strictly professional between you and the friend but also offer you options that may best serve you in the long run as well. You also need to do a lot of paperwork that you may not understand like a purchase offer, an inspection report and many more other documents. You will not just be handing your friend cash and then they simply give you the keys to the house. It is a more longer and more complicated process to buy a house without a realtor.

Your Friend May Get More Out Of You.

Assuming you’d be buying this house off your friend for the first time without a realtor, you may get less than you paid for all in the name of friendship. A realtor can help inspect the house for any damage and any parts of the house that may need repairs. They will then decide from that what the value of the property will be. But if you only hear an assumed price off of your friend’s head and then from there try to negotiate with them; this method of property valuation is not at all conducive.

  • Although you pay (about 3% or more of the final buying fee) to the realtor, they can easily negotiate the price of the house down to what it will be actually worth. Because they are able (due to experience) to spot the best and worst things that are in the house that you may not notice or ignore as the friend of the seller. It is very hard to separate emotion from logical decision making especially when dealing with people you are close to. You may end up paying for an overpriced house out of pure (simple) emotional connection to your friend.


As you can probably tell by now the steps to buying a house without a realtor are numerous and long. You would much rather just pay a small realtor fee to have it all done for you in a matter of weeks. Realtors have connections that help speed things up and you may appreciate their services more than you think. It is important to note that you need to have a real estate buyer’s license to buy the house and likewise your friend needs to have a real estate seller’s license, these two documents are not necessary however when you involve a realtor from the get-go. So it’s pretty complicated to buy a house from a friend without a realtor, but if the long process is no problem for you then you can go on right ahead.