I would contact a local RE attorney to represent you in this transaction. It should be less than paying 3% to an agent.

Of course I don't know the details of your purchase, but a good attorney will look out for your interest.

Be certain the mortgage broker is your best way to get a loan, Have you contacted direct lenders? What does your broker charge, do you pay for him?

Hi Cmarlin20,

Thanks for the advice!

We haven't followed up much with the broker since the summer; we have a call in with him on Monday. We'll make some appts with our bank and credit union as well.

So a real attorney can help us with liens/titles, etc? My main concern is that we will miss something big that is beyond the scope of what an attorney will cover.

The issue is your experience level and your lack of confidence with the process. For a first timer, yes, I'd add the 3% to the home's cost and pay your agent to shepherd you through this. If the property is as great as you say, you may not ever need to do this again, so make sure thing go smoothly. An attorney is not going to be there to answer 6 different calls about the what is happening unless you pay them for their time. A BA will be there for as many possible questions as you might have for the whole process for a single flat fee. If your mortgage broker doesn't work out, she'll have other resources. If the seller's attorney puts you on the back burner, the BA will be the squeaky wheel to get things moving faster. Things will just go a lot easier for YOU if you have some help.

If you were an experienced buyer with a higher confidence level, I might advise sending some type of nice thank you gift to the agent and explain that you have found a private deal but appreciate the time she gave you and the contacts that she linked you with. Then, just have an attorney handle the closing process.

I don't live in an area where attorneys act as closing agents, so I can't really answer as far as what they do as far as title search, etc., but I can guarantee you that your lender will not loan on a house until a thorough title search has been completed.

The lender will have you pay for a title insurance policy to protect their interests, and you should also get an owner's title insurance policy.

I don't know the price of the home that you are interested in, but I don't think that you would need to offer the agent as much as 3% to hold your hand and handle the paperwork if you decide to go that route. I would talk to her about a flat fee, and have her also do a market analysis of the property.

Might the buyer have some additional protection by using a realtor, should the house prove to be 'not as represented'? Does that apply only to listing agents? (The house in question is not listed.)

It sounds like the buyer has confidence in the realtor they've used. *I* would keep her the job for this deal -- in part because the seller is offering such a 'bargain'. (IS it a bargain?)

My experience with a 'one deal' commission was as seller. A neighbor/realtor knew we would be selling within the year and brought us a potential buyer. We had a low-commission contract with her for that sale/that buyer only. We sold for top dollar for our neighborhood without having to show the house, and the buyer was OK with a delayed closing while we built our new home.

I don't see any reason to involve the real estate agent in this transaction. A real estate attorney can handle all the upcoming paperwork and a good one will act in your best interests. This will cost you much less than trying to work out some sort of commission for the agent, unless she would agree to the same flat fee that the attorney requires. I've never had a problem bringing a deal to a successful conclusion by using an attorney and not an agent, both as a buyer and a seller.

Hi All,

Thanks so much for your thoughts and advice!

The house is a good deal, but not a steal. I am confident in the comps; I was inside all but one of the similar homes that have sold since June (not very many- only 5). We like the house, the location, the neighbors, etc too much to risk it by low-balling.

We are going to look at financing this week and will price out the attorney.

I have emailed my BA to see if she's available for a flat-fee, and if so, I asked for an estimate of how much. My DH and I really like our BA, so we'd like to go with her if possible.

We saw the house again, today, this time with my FIL. He gave it a good review- solidly built, roof good, heater good, all systems go. Will need some cosmetic updating but the bones are great.

We just love it. We love our neighbors (all 8 couples), we've been living on this quiet road for 4 years and know all of its pluses and minuses- we just really hope this works out!

We really appreciate everyone's input and will update so you know how it all turns out!

A real estate attorney can handle all the upcoming paperwork and a good one will act in your best interests.

I should hope so, since that is their legal and ethical obligation!!

Just wanted to wish you good luck. Sounds like a perfect fit.

Jane

Terriks, many professionals have legal and ethical obligations, but as we know, not all abide by them. The good ones do. I'm not sure why my cautionary advice to the OP elicited such a reaction from you.

For my first home purchase I used a highly recommended RA Attorney and things went great. In your situation it would work out very well I think to go that route.

I have found that in our area many real estate agents aren't quite up to speed on the legal side of the RA business and writing up a contract beyond the standard MLS state required forms isn't something they are schooled to do much of.

You have the perfect opportunity to avoid the real estate agent side of the business and use a good attorney to help you. If you were dealing with a sellers agent and a listed property then the BA would be more beneficial.

Our last property purchase we did use a Buyers Agent, and while he did help us out in some cases - mostly getting us in the door as soon as possible for newly listed homes, I found that I knew more that he did at times regarding transaction details and contract terms

We ended up buying a lot that I knew about prior to working with this BA. In addition to the BA getting his 3% commission (from the seller in this case) I still paid my attorney to go over the purchase contract, the title report, and the neighborhood association rules etc...

If you have done your price/value research, I agree that a RE agent should not be needed, a RE sttorney should be cheaper than the 3% fee you are paying for an agent.

"If you have done your price/value research, I agree that a RE agent should not be needed, a RE sttorney should be cheaper than the 3% fee you are paying for an agent."

That is assuming that the seller will reduce the sales price by 3% and the buyer still has to pay a minimum of $250 to $300/phr for an attorney.
I'd have a good agent negotiate the purchase price including some closing costs for me, where you probably will do better in the end.

It depends on the state.
In my old state of NJ where a RE lawyer is required for any RE transaction, they charge a flat fee of around $500. And the RE agent fee does not have to be 3%, it could be 1% because it is a sure sale.