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Using a Realtor as a Buyer?

Posted by splais (splais1@gmail.com) on
Wed, Sep 4, 13 at 23:39

Question: What are your views on the need or not need to use a Realtor if I am the buyer and am basically finding my proposed house on my own?

Is it not true that if I have my own realtor looking for a house, he will split the commission with the sellers realtor. Would not having a realtor be a bargaining chip that may save me some money when negotiating a final price?

Thanks


Follow-Up Postings:

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RE: Using a Realtor as a Buyer?

No, because the seller's agent will just take the whole commission.

If you are not an experienced home buyer/seller, I would recommend you use a buyer's agent.


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RE: Using a Realtor as a Buyer?

Theoretically, yes. Realtor's commonly pitch in part of their commissions when the buyer and seller are unwilling to bridge the final gap. And having the seller's agent getting the whole commission gives them more potential money with which to do that.

Keep in mind that it's the realtor that would be chipping in, so it's not within the seller's control, though presumably they could lean on their agent to do so.


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RE: Using a Realtor as a Buyer?

The seller's realtor works for the seller. They don't work for you. They aren't your friend and they are going to try to get the best deal for their seller. You're just a checkbook to them.

Unless you are experienced at negotiations involving thousands and understand a good deal of real estate law, why wouldn't you want to have someone in your corner that works for YOU and that you don't even have to reimburse? Even if you are experienced with all of that, a buyer's realtor still is a good idea. They do that all day long, for a living. Even if you're OK with the negotiations, you're an amateur compared to them. It's why they have a ProAm golf tournament. Occasionally you'll see a very good amateur at the top of the leaderboards, but that's the exception, not the rule.


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RE: Using a Realtor as a Buyer?

so what about a situation where you are considering a realtor, but there is a good chance the property you may end up buying is carried by that realtor's firm? Just who is the realtor working for in that case, me or the seller?


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RE: Using a Realtor as a Buyer?

The realtor is ALWAYS working for the seller, because the seller pays the commission.

In your example, use another realtor in the firm to avoid a dual agency problem.


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RE: Using a Realtor as a Buyer?

so what about a situation where you are considering a realtor, but there is a good chance the property you may end up buying is carried by that realtor's firm?

That really depends on the real estate laws of your state.


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RE: Using a Realtor as a Buyer?

Here, the *broker*, not the individual agent, is the representative;
it's considered dual agency if seller is represented by one agent & buyer is represented by another in the same firm.
In practical terms, both parties have representation even though it's technically dual agency.


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RE: Using a Realtor as a Buyer?

To have someone represent your interest hire a real estate lawyer. They will be much more knowledgable and less conflicted than a real estate agent (they will work for you rather than the seller). They won't do the little niceties of managing inspections etc, but they will protect your backside and cost less to boot. There's no particular reason to have an agent once you've identified the house you are going to make an offer on. Here in MA the lawyers do about 90% of the work in a transaction for a fraction of what the agent makes.


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RE: Using a Realtor as a Buyer?

As said, it is not always true the listing agent only works for the seller. Does your state allow dual agency?
Literally a dual agent works for both, in practical terms this is not easy, but it can be done if you are experienced and know your terms.
The listing agent will work very hard to make your offer work and more readily give something up some commission if it is tight negotiating.
I've done this successfully several times.


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RE: Using a Realtor as a Buyer?

In FLORIDA, dual-agency is not allowed except for very specific situations that likely do not apply to you. Any agents working for the same broker fall in this category, if they are "single agents".

That said, very few agents represent their sellers or buyers as "single agents" which is a fiduciary representation and they owe "loyalty, confidentiality, obedience and full disclosure " to their customers (in addition to the 7 duties of a transaction broker below). You can understand why one agent (or broker) can't usually provide that service to both buyer and seller.

Most agents work as "transaction brokers" which means their duties include:
1-Dealing honestly and fairly
2-Accounting for all funds
3-Using skill, care and diligence in a transaction
4-Disclosing facts known about the property that might affect the value of the property
5-Presenting all offers and counter offers in a timely manner
6-Limited confidentially unless waived by a party
7-Any additional duties that are entered into by this or by separate written agreement
This is the only way a broker (with one or two agents involved) can represent both the seller and the buyer.

I just closed a contract where I was a transaction broker for the buyer of a FSBO, which meant I had a "no broker" relationship with the seller - but I am still obligated for #1, 2 & 4 above to the FSBO sellers. But I was a transaction broker for the FSBO sellers' purchase of a new home, so I did owe them additional duties for them as buyers.

The point is that a buyers' agent works for your best interests and you will not pay more for the service. In most cases, the seller pays an agreed-upon commission and the brokers (via MLS) work out how they will (or won't) share it amongst themselves and the agents that work for them.

As a new or newer buyer, I can't recommend enough that you have an agent help you through the process. I just helped two experienced couples get through the agonizing process (one was a VA loan - painful) but both had not bought homes in 20 years, nor done the loan process recently. If you are relocating (like one of my couples) it is even more helpful because then you have additional issues like not having a local bank, or you didn't bring enough checks to cover the up-front costs (home inspection), etc. I can point out probably four specific points in the transaction that would have obliterated the contract if I had not personally guided the buyer through (definitely the toughest one for me, ever).

Best of luck to you in your purchase!


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