Lots of consumers wonder why they should have a buyer’s agent when purchasing a home. They ponder whether there is going to be any value. If you are planning on buying a home, it only makes sense to hire a buyer’s agent.
There are multiple reasons to do so, many of which we will cover here. The fact is buying a home happens to be one of the most significant purchases you are likely to make in your lifetime.
Having a professional on-hand to look out for your best interests is essential. A buyer’s agent will help ensure that you get the best possible results—and will make it more likely that you can achieve the outcome you are seeking.
Unfortunately, some uneducated buyers think that going directly to the listing agent gives them a leg up on a purchase. Wrong! The listing agent works for the seller. They have an allegiance to the seller throughout the transaction. Their goal is to get the seller the most money possible. A seller’ agent can give you ZERO advice.
Quite often there are agents who practice dual agency – frankly a horrible situation for you and the seller. The real estate agent becomes a neutral party and cannot give either the buyer or the seller any advice. Completely moronic! When you are buying a home, there is incredible value in having someone working for YOUR best interests.
Here are 13 reasons why having a buyer’s agent is a must when purchasing a home.
That’s right. In most cases, hiring a buyer’s agent won’t cost you anything. No, buyer’s agents don’t work for free. But they also don’t get paid by the buyer. They get paid by the seller. Typically, the buyer’s agent and the seller’s agent will split the commission on a home sale.
The only situation where you might be expected to pay the buyer’s agent is if the property is FSBO—For Sale by Owner—and the owner refuses to pay the fee for the agent. You can generally avoid such situations, though, just by verifying that any FSBO home you look at is being sold by an owner who has agreed to pay the buyer’s agent.
Your agent should explain how commissions work in instances like this one. Keep in mind there might be a great for sale by owner out there that fits your needs perfectly. Part of your buyer agents job is to find one of these properties for you, should they become available.
If a for sale by owner won’t pay a commission, you can always deduct that amount from what you offer the seller. This is one of the many reasons why for sale by owners rarely save money.
The fact you won’t be paying any money out of your own pocket should be a significant reason for having a buyer’s agent.
The real estate market is in constant flux. Unless you are a professional real estate agent, it is difficult to be fully aware of everything that is going on in your local market. That is why you hire a buyer’s agent—because he or she will have the market knowledge you need to get the best results from your purchase.
The agent can advise you on what kind of offer is likely to get you the home you want. Your agent can give you an informed opinion on where they see the local real estate marketed headed. Are prices rising or dropping? Are inventory levels going up or down?
Are you likely going to be involved in a bidding war because there are so few homes on the market? If that’s the case how can you put yourself in the best position to win?
You only have so much time to spend looking at homes. Coordinating showings with sellers and their agents can be a juggling act, one that may become frustrating when inventory is tight, and homes are selling fast. An exceptional buyer’s agent will be flexible with getting showings coordinated. They will work around your busy schedule as best they can.
Your agent will figure out how to get you to the showings you want most when you want them. There are times this will be difficult like when the seller insists the listing agent attend.
Lots of buyers put a lot of focus on the home they are excited about buying but forget about their surroundings. How is the neighborhood? How is the city or town to live in? Are there any known problems nearby that may give a buyer second thoughts?
The best buyer’s agent will have a pulse on the local market. They will know the best attributes along with the worst. As a buyer, you may not be comfortable purchasing a home that was near a toxic waste dump. A buyer’s agent will research issues such as this one and give you the lowdown.
A significant role of a buyer’s real estate agent is to perform due diligence on the house you’re interested in. They are there to protect you. A real buyer’s agents role isn’t to be a glorified taxi cab driver. If this is the kind of agent, you are working with FIRE them!
In most states, homeowners will fill out what’s known as a seller’s disclosure statement. In this document, the seller will tell a buyer what they know and don’t know about the property. An outstanding buyer’s agent will review this form with you. They will advise on anything that may need further clarification or possibly investigation.
For example, some sellers are notorious for not getting required building permits for remodeling work they have done in their homes. This is a big no-no that could cause problems for a buyer once it’s time for them to sell.
A buyer’s agent will research at the local town building department when there are suspicions that permits have not been pulled.
One of the essential roles of a buyer’s agent is to advise you on what to offer on the home you’re interested in. There should be a detailed analysis done on what to offer. The conclusion should be based on comparable sales data of other similar properties. The focus will be on what sold.
The best real estate agents understand pricing well. They know how various amenities in a home will impact the ultimate value. When it comes down to it, this will be one of the most critical tasks a buyer’s agent will provide. The value will be based on real science, not some phony Zillow estimate.
You will live with what you pay for the home for years to come.
The agent you work with should have extensive knowledge of different financing options. He or she can put you in touch with lenders that will meet the financing criteria you are looking for. Understanding how to choose a lender is an essential aspect of the home buying process.
The agent will likely have one or more mortgage brokers that he or she likes to work with as well. So you can discuss your financing options with the agent and ask for recommendations on mortgage brokers.
One thing to keep in mind about financing—it is typically best to work with a local mortgage company when possible. Local companies know the market you are in better than those without any local presence. They tend to be easier to work with and more likely to be helpful.
Here are some helpful questions to ask the lenders you are interviewing. The last thing you want is a mortgage broker or lender that will take advantage of you.
You may be great at negotiating, or you may dread the prospect. If you are a good negotiator, you know the importance of knowledge when it comes to getting the best results. Your agent knows homes and the market and can use that knowledge to negotiate effectively on your behalf.
If you don’t like negotiating, having an agent solves the problem. You discuss your offer with your agent, discuss terms, etc. They become your voice. You have the ultimate say, but can rely on the agent to do the talking and negotiating for you.
One of the most vital aspects of negotiating will likely come into play after the home inspection is done. If there are any significant inspection problems, you’ll want your real estate agent to help negotiate either a credit, price reduction or repair. Negotiating after an inspection goes with the territory for a buyer’s agent.
Real Estate agents are often associated with being therapists on the side. With so much riding on the line, it is normal to get emotional over a home purchase. You may really want the home. You may be stretching your finances to buy it. You may find the attitude of the seller irritating or even infuriating.
Business deals are best done with a cool head, so you need to avoid letting your emotions get the better of you.
Having an agent as a go-between is excellent for an emotional filter. Vent to the agent, and then move forward with razor focus.
There is nothing that replaces real-world experience. While it is vital for you to do your research in the home buying process, you can only absorb so much information and advice. Fortunately, with an agent, you have someone who has viewed probably hundreds of homes. He or she can give you valuable insight into what a home lacks and what it has that is desirable.
They should be able to tell you what resale value will be like in the future. Will the home appreciate well or be a laggard.
You may be quite familiar with buying homes, or you may be brand new to the process. But even if you have done this seven different times, you are still going to benefit from having a professional guide you through the contract process.
Real estate contracts can be confusing and difficult to understand, which is why having a representative looking out for your best interests—who is not going to be baffled or overwhelmed with the contract process—is ideal.
Your agent will know about the various possible contingencies that can show up in a real estate contract—both those the seller might try to include and those that you might want to have based on your circumstances.
The agent can also write a proper contract on your behalf, which will make you look like a desirable buyer to sellers and their agents.
There are a variety of professionals that may be needed to complete your transaction. Instead of having to spend your time tracking these people down—like home inspectors, real estate attorneys and mortgage originators—you can leave the task to your agent.
He or she should have a list of trusted professionals that are known to be excellent to work with and can connect you with them immediately. The agent can be a fantastic resource for so many things before, during and after your purchase. Maybe you need a landscaper, painter, plumber or mover?
The best buyer’s agents will have connections and be able to provide you with a list of trusted contractors.
While some delays in a home purchase can be unavoidable, many potential delays can be spotted and avoided before they occur. But detecting the problems early on requires awareness of how things are supposed to go, which only comes with experience.
Your agent will pay close attention to the transaction and remain on the lookout for possible issues. He or she is just as interested in making sure things go smoothly as you are, and should be well-equipped to keep things on track.
When delays do occur, which can happen, having an agent will help you minimize the delays. Your buyer’s agent will be able to identify where things went wrong and determine potential solutions based on prior experience.
In the end, you have every reason to hire a buyer’s agent and no reason not to. Take the time to interview a few agents and take your pick. You will be happy you did. Here is a summary of what a buyers’ agent does for their clients. Look for a real estate agent who will do all of these things for you.
Have a look at each of the above resources from other real estate professionals for more sound real estate advice.