Let us start with a quick word about working with a real estate agent if you are looking to buy a home. Real estate agents who work with buyers are known as a buyer’s agent. These agents are supposed to represent your best interest in purchasing a home. They show you homes, help you put in your sales contract offer, negotiate any counter offers from the seller, and guide you through the time from when your offer is accepted to the time that you get your keys. Although this list may seem simple, buyers’ agents do a lot of work from start to finish. Most good buyers’ agents become friends for life as they know a lot about you and will remember you even when even your family forgets to mail that birthday card.
Work With A Real Estate Agent to Buy a Home
This is a frequently asked question in real estate and finance. The simple answer is yes, it is a good idea. Although it is not necessary it is a good idea to work with an agent when buying a home. A good buyer’s agent knows the market, knows how to negotiate to get you the best deal possible, keeps all the balls in motion that get juggled so that you close and get your home when you want it.
How Do Real Estate Agents Get Paid?
A good buyer’s agent is worth their weight in gold, maybe even platinum. They can save you a lot of money and headache when buying a home. What is so unique about the real estate business is that while they do a lot of work on a buyer’s behalf, the buyer does not pay them anything. Most of the time, agents who represent buyers get paid from the seller of the home. In other words, the buyer’s agent only gets paid when you get the house.
The seller sets aside some of their profits from selling the house to pay not only the buyer’s agent, but the selling or listing agent too. In some cases this can range from a couple of $1000 to 7% of the sales prices of the home.
The Buyer’s Agent Contract – What is it?
The buyer’s contract is a contract that spells out all that the buyer’s agent will do for you when they work with you to find and purchase a new home. Sometimes an agent will have you sign a buyer’s contract that has something in it saying that you agree to pay them a fee for their time and effort in locating a home for you even if you do not use them to buy a home. One example of this is what happens if you find a home that is “for sale by owner” (FSBO) where they are not offering to pay a real estate agent and you end up buying this home.
Before you sign the buyer’s contract in the beginning you need to carefully discuss with your agent the different things that can happen if they have this kind of contract with you that requires you to pay them a fee for certain services. You will also need to be careful if you do find a home for sale by the owner and you try to buy it without your agent knowing it.
Real estate agents have access to a lot of information about real estate transactions. Chances are, if you were working with an agent and then you stopped, they will start looking for why. Who can blame them, they work hard for the services they provide. They ought to be paid for their efforts just as you want to get paid for the job you do. Now, if they find out that you have done something that violates your contract, it is up to them to enforce it. Can they, absolutely, will they – well that is another question. It is probably going to depend on what it is and how money they are looking at. Then the question is: can they collect. If you are going to go against a buyers contract, make sure you talk to an attorney before you do so or you might be sorry you had not.
Find and Meet with a Real Estate Agent
Once you have figured out how much money you can borrow you were pre qualified your next step is to meet with a real estate agent. Ask around for referrals. Just about everyone knows an agent that either they liked or did not like. Get some names and call for an appointment to meet with several agents. For your first meeting, you should put together a list of questions and things you want and need in the home. Ask the agent about themselves and why they sell real estate. You also will want to come to the first meeting wide open to different possibilities, or in other words an open mind.
How you will know if you are on the right track with your agent is if you doing most of the talking and they are doing most of the listening. If you find yourself meeting with them and they are doing most of the talking, especially if it is about them and how great of an agent they are, you need to find a gracious way to get out of your meeting with them as quick as possible. The agent should just be gathering from you the most information that you can give them so they can really find the perfect home for you. Do not forget to share with them what you found out about from your mortgage broker.
Have a Question or Concern During the Purchase Process – Tell Your Agent!
Buying a home can be an experience like riding a roller coaster. There will be ups and downs, and slow points and very fast times. You will also probably experience fun, excitement, satisfaction, expanding what you know and even a test of your patience. Given that you will probably be challenged along the way, you need to make sure you are comfortable enough with your real estate agent to be able to let them know when things are not going well. Make sure your agent knows exactly how you feel about things. If you do not, they cannot help you fix something that needs to be or can be fixed. After the fact is a bad time to start trying to fix something.