Informative Articles for the Homebuyer:
• 7 Reasons to Own your Own Home
• 10 Steps to Prepare You for Home Ownership
• 10 Tips for First-Time Homebuyers
• 5 Reasons You Need a REALTORŪ
• Questions to Ask When Choosing A RealtorŪ
Homebuying Articles, Tips, and Information
Buyer Beware: Who Really Works For YOU?
You and your significant other decide to take a drive and check out some of the open houses in the neighborhood. Before you know it you're walking through the door of a charming home, speaking to an equally charming Realtor who's telling you all the virtues of this wonderful home.
And then he pops the question: "Are you working with an agent?"
When you tell him you're not, suddenly you are his new best friend, and he's relating all the great things he can do for you as your agent. It all sounds so wonderful... yet it's the same you've been told by every Realtor you've ever met. So how can you really tell if you can trust this agent to look out for your best interests?
Indeed, the most important detail you're not being told at this point is this: If you use the listing agent of the property to act as your agent in the purchase, then your agent will NOT be working primarily for you, but rather the seller.
The simple fact is that the listing/seller's agent has been hired by the seller to represent the seller's best interests, not those of the buyer. And part of the listing agent's responsibility to the seller is to disclose all material facts they discover about the buyer - in other words, everything they discover about YOU!
Can This Be A Problem?
Well, consider this: Suppose you have $5,000 in the bank and you wish to purchase a home with a VA No-No - no money down and no closing costs. In the offer - written by the listing agent - you ask the seller to pay all the closing costs, estimated at $5,000.
Now what do you suppose the seller will do with an offer asking them to pay $5,000 in costs when they know you have $5,000 in the bank, a fact they learned because "your agent" was obligated to tell them?
There's another important factor to consider: In Virginia, ALL agents technically work for the seller in the transaction, either as the listing agent or a sub-agent to the seller through the MLS listing agreement. ONLY with a written agreement between the buyer and his agent can the buyer be assured exclusive representation.
We accomplish this goal with a Buyer-Brokerage Agreement. This form "allows" us to represent our buyers exclusively, with no loyalty or responsibility to the seller. And the most important thing to remember: WE STILL GET PAID BY THE SELLER through the commission agreement.
So, in essence, the buyer in this case has the best of both worlds. Exclusive representation by a professional Realtor without having to pay for it!
And since we're talking about exclusive representation, there's a very simple rule in real estate which can save you literally thousands of dollars of out-of-pocket money when buying a home: Enlist the services of your own agent, not the agent representing the seller!
Sounds simple enough, doesn't it? But you'd be surprised how many people think they MUST use the agent whose name is on the sign. This simply isn't true. As long as the home is in the Multiple Listing Service, you can use any agent to represent you. And best of all, it doesn't cost you anything extra to have your own representation.
We're not telling you all this to scare you. There are plenty of listing agents who can represent both sides of the transaction and do so ethically. It is legal, with the proper disclosure to you. The question is, why would you? In essence it's like using the same attorney to represent both you and your spouse in divorce proceedings. Not a smart idea!
So now that you see the logic in having your own agent, here are a few other important things to remember:
Nearly all agents - probably 99.9% of them - work on commission only. If you don't buy a home, we don't get paid. SO as realty agents we are doing everything in our power to:
- Help you qualify to buy a home
- Find the home you wish to buy
- Make sure the transaction goes smoothly and with least amount of problems.
Only by meeting these three goals will we get paid.
Also there is unquestionably a lot of work that goes on between the initial phone call and receipt of our commission check - a lot of work which goes completely unpaid if we don't find you the home to buy.
Yet we are loyal to OUR clients. We ask the same in return. This is all common courtesy and common sense.
