Working with an Agent
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Using the services of an agent can be helpful since they have first-hand knowledge of available homes and services. But understand what services they can provide.
Using an Agent to Find Your Home
Your local real estate agent can be a valuable resource.
They generally have first hand knowledge of all new homes on the market and can work with you to find the right home in the right neighborhood at the right price.
There is a cost for their service, which is paid for by the seller.
That's the hitch. Is the agent working for the buyer or the seller? That depends on how you manage the relationship. The agent legally works for the seller and does not get paid until you close on the home. So don't let the agent pressure you into any home.
Take the time you need to see as many homes as possible.
Be clear with the agent about what you can afford and what you want in a house and neighborhood. Request that the agent address any problems you encounter. If the agent fails to work with you, find yourself another agent or consider using a buyer's broker.
Selecting the Right Agent
Once you find your agent, check them out by applying some basic principles. Examples include:
- Does the agent return phone calls promptly?
- Does the agent show an interest in you and your
needs? Do they work to find the right home at
the right price?
- Does the agent provide you updated computerized
multiple listing (MLS) of homes? The MLS is a
listing of homes that are being sold by several
brokers in the area. The MLS will list those homes
that match your needs.
- When you visit prospective homes, does the agent
spend time showing you the home and its feature?
Is the agent willing to discuss other options
if you are not interested?
- Does the agent spend time explaining the home
- Does the agent inform you that they acting as
a seller's agent?
- Does the agent provide maps of the area and point
out places of interest?
- Does the agent investigate and discuss any potential problems in the area?
What Can the Agent Do?
Here are some additional services an agent might provide. If they don't volunteer the service, ask for it:
Analyze Your Financial Situation:
Before you look at your first house, the agent should sit down with you and estimate what you can afford. They will review the price of homes based on your anticipated monthly payment and discuss potential closing costs.
They Will Screen The Listing:
This is probably one of their greatest services. They will screen the large listing of homes and provide you the homes that fit your style and price. They can also provide you with comparative listings of homes that sold in the area.
They Will Show You the Neighborhood:
Good real estate agents will show you around the neighborhood. They will point out the shopping centers, the schools, parks, and other services that make the neighborhood nice.
If You Are Moving to the Area, the Agent will Act as Your Personal Guide:
They will meet you at your hotel and personally drive you around the neighborhood. Take advantage of their hospitality. There is no better way to become familiar with the area than a personal pickup service by an agent.
The Agent Will Arrange the Showing:
Just mention when you are available to see a house and the agent will handle all the details.
Negotiate the Contract:
Agents present your offer to the seller and communicate counteroffers. They are able to point out differences so that you and the seller can negotiate in good faith.
Mortgage Application Assistance:
Sometimes you will need assistance with the mortgage application. They will discuss financing options and lending arrangements, and they will keep in contact with the lender to see that your paper work is completed.
[The Home Buying Center is a self-assisting mortgage application service. We have built a network of mortgage lenders who can review your financing options and arrange your mortgage at the best rate and terms. See our financial network.]
Help with the Inspection:
Before you close on any home, you will want to have the home thoroughly inspected. The agent can refer you to several recommended inspectors.
Close the Deal:
They can assist with your closing to make sure you understand the terms and procedures. In some areas, the agent may accompany you to the closing.
Working with a Buyer's Agent
The seller of the home has a fiduciary relationship with the agent.
By contract, the agent represents the seller's best interests. Since the agent is being paid on commission by the seller, a buyer may wonder if they are getting the best service or price for the home.
You may want to hire your own broker. When you enter into a 'single agency' relationship, it becomes your responsibility to pay the broker. Not only will you have the broker's undivided attention, you can also be guaranteed that the home meets your needs at the best negotiated price and terms.
Find a buyer's agent:
Real estate agent buyer's council:
Buying Agent Notes:
The buyer broker can offer the same services as described under the agent services. In addition to these services, the buyer's broker offers the following advantages:
- Expand Your Options:
The buyer's broker can target specific homes that may not be on the market. Buyer brokers can, upon your instructions, cold-call homeowners to determine their interest in selling.
- They Operate in Good Faith:
Now that the broker represents your interests, you can be assured that the broker will operate in good faith. They will find you a home for the best possible price.
- They Can Negotiate the Best Deal:
They will negotiate exclusively for the buyer, anonymously if you desire, to get the best possible price. Agency conflicts are eliminated. The selling agent represents the seller; the buyer's broker represents you the buyer.
- How Much will You Pay?
A buyer's broker relationship can vary in fees. Some require up-front retainer fees and/or a percentage of the total home price. Generally, the broker usually accepts 3% of the total home price.
Some brokers may even split this fee with the seller's agent. Make sure you ask for the compensating price before signing a buyer's broker relationship.
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