PROS-Buying with an Agent

The most common misconception with hiring a Buyers Agent is that you’ll have to pay for it. The rare exception is when a “For Sale By Owner” refuses to pay the commission. Otherwise, be not worried. More on this below:

1. Starting Off on the Right Foot

Guiding you through the loan pre-qualification process, sending you daily listings based on your criteria, accompanying you on walk-throughs, drafting an offer, negotiations, due diligence, deadlines, and closing. And other distractions in-between every step.

2. Avoid the Added Stress of Paperwork and Set-backs

You begin with an exciting start. Little by little the online search and open houses start to show their wear. Finally, you think you’ve found something that will fit you well. Now to the next game, The Offer. Mind games abound and then, The Deadlines. Often you’re lucky enough for a decent inspection and a smooth appraisal, however when you’re not so lucky you thank yourself for choosing a competent Agent of Value to navigate you through the mess. In the end, the closing should be a satisfying moment, not one of frustration.

3. True Representation

Another misconception, if a buyer (without an agent) approaches a listing agent with the intention of “saving” money they’ll usually be somewhat disappointed.

Let’s look at it in detail: The commission is agreed to by the homeowner to their listing agent. Let’s use the example of 6%. The listing agent then decides to offer half (3%) of his commission to the next agent that has a qualified buyer ready to go. If a buyer’s agent doesn’t surface, the commission split refers back to the listing agent as his full commission, rather than split.

The 3% doesn’t automatically serve as a discount for the buyer as they assume it does. It’s the listing agent’s commission and the buyer has no right to it………unless the agent allows it. Usually this is done in the name of keeping things smooth with the homeowner. One major draw-back to this, for the listing agent, is that often they’ll be expected to provide the paperwork, answer buyer’s questions, provide more paperwork, answer more questions. This adds an additional weight of time and effort to the listing agent, not a fair trade in their mind for sure. Now you may understand why some listing agents aren’t so patient with unrepresented buyers. As a side note, dual representation (agent representing both sides) is never in anyone’s BEST interest. The best option is for the listing agent to refer another agent from their office, giving you full representation, and a partial negotiated discount (if allowed).

4. Perspective

An agent with an experienced and un-biased background is key. Whether it’s a cookie-cutter home or a fixer upper, you need an educated perspective of what to expect down the road.

5. Time in Due Diligence

Buying a house isn’t a weekend project. From researching zoning restrictions, cost of utilities, to projected maintenance costs. Let’s not forget opportunity cost, the time it takes in sifting through the details of each prospective home. The time definitely adds up, even more-so without an agent.

CONS-Buying with an Agent

The disadvantages of using a Buyer’s Agent aren’t as numerous or as valuable, but they exist. Most cases where the CONS may out-weigh the PROS is when there’s a FSBO (For Sale by Owner) involved. *Agent’s response.

1. Less Flexibility

Sometimes there are offers or requests the Agent doesn’t feel comfortable making and advises against it. Whether they’re right or not, you may feel the need for more control. Another situation, the Agent will have a different search criteria than you do, emailing you properties of no interest or out of budget. A simple request to correct this would be in order. If it is recurring, you may consider another agent. Make sure you be upfront with your “breakup” to avoid issues down the road, legal, civil, or emotional.

2. The Middleman

In your frantic “home shopping” process, you might wish you could side step your agent and start calling the sellers or listing agent directly to schedule as many walk-throughs as you can after work each day. FSBO’s might be more than happy to have you, however if they’re represented and you’re not, you might get ignored. In the case of seeking a FSBO, cutting out the middleman is appealing. No need to wait for callbacks or relayed messages. There are definitely other pretty big drawbacks to consider that we’ve brushed on previously. Finding a home is only the beginning. Then there’s drafting an offer, negotiations, due diligence, loan issues, deadlines, and closing. There’s definitely less incentive to go it alone in the buying process than in the selling.

Most Pros and Cons can be debated based on the agent’s competence and strategy. Contact me to let me show you what I have to offer….or keep browsing my blog and you’ll quickly find out.

Other Resources

First-Time Home Buyers : The Ultimate How To Buy Guide
How to Vet the Agent
Understanding Agent Commissions
What to Ask When Signing an Agreement

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The above article “The Pros and Cons of Hiring a Real Estate Agent – Buying” was provided by Tanner Johnson. If you’re thinking of selling or buying, I’d love to share more information with you.

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