Why we used a real estate agent
Those of you that are frequent readers of Gather Little by Little know that we are have been in the process of selling our home, buying another one and moving over the past 2-3 months. Currently our home is up for sale, and we have a contract on a 4 year old home in the NC mountains that we can’t wait to move in to. Now if we an just sell our current home!
I’ve learned a great deal through this process, and thought I would begin sharing some of those learnings with you. Mind you, I am by no stretch of the imagination a real-estate expert, just an average guy whose learned a few things along the way.
This is the first in a series of articles I’ll be writing about our moving/purchase process. I’ll try to share one with you every week or two.
Using an agent will save you a great deal of hassle
When we first began looking for our home, we didn’t engage an agent as we weren’t exactly sure where we wanted to live and wanted to make that determination first. Primarily so that once we did hire an agent, it could be someone local and familiar with the area we were looking.
Once we decided on the area we wanted to live, we still held off getting an agent as we wanted to determine where in the area we wanted to live. We avoided an agent so as not to waste their time. After all, we could figure out the good and bad places to live right?
Next thing we knew, we had stumbled across a home we liked, made a call to the selling agent to show us the house and shortly thereafter were making an offer on it. I knew nothing about how making an offer worked, so I called the agent and made a verbal offer over the phone to which the sellers quickly declined with a “Thanks, but no.” reply. I was surprised, I at least expected a counter offer. I called the selling agent and she all but told me a nice way that perhaps a more formal written contract as they are usually done would be accepted. In a more or less nice way, she was telling me I had no clue what I was doing. She was right.
We had no clue how to do the paper work, and quickly realized we were probably a little beyond the point of needing an agent.
Finding an agent
I’ll be the first to admit I didn’t find an agent the right way. I had worked with Coldwell-Banker in the past and was happy with them, so I went to their web-site and found the local Coldwell-Banker agency in the area we were looking. I then looked at the agents pictures, determined who I thought looked trust worthy, and gave them a call. Fortunately my crazy scheme of finding an agent worked, as we’re extremely happy with ours. He’s a super guy that knows the area and has sincerely worked in our best interest.
Now, for the right way to find a good agent:
- Make sure they are licensed – All Realtors® are licensed to sell real estate. All agents are not Realtors® though. Realtors® belong to a national association that is bound by a code of ethics.
- Attend Open Houses – At open houses you can meet agents and watch them do their thing. Pay attention to them and see what they do to sell and promote the house.
- Referrals – Most people find their agents through referrals of friends, neighbors, co-workers, etc. This is a really great way to find an agent. Good agents will have multiple clients singing their praises.
- Search online – Don’t be confused by sites that recommend agents, they are often paid to do so. The only sites I would recommend would be professional ranking companies and you should even be cautious of them. The best thing to do using this option is to visit the actual brokers site, and read their credentials.
- Pay attention to signs – Drive through neighborhoods and pay attention to the for sales. Note which agencies and agents are listing the most homes.
- Read the paper – Agents list the homes they have for sale in the paper not only to promote the homes, but to promote themselves as well. The Sunday paper will have the best variety.
Seller Broker vs. Buyer’s Broker
Real estate agents can serve in two rolls: A Seller’s Broker or a Buyer’s broker. A seller’s broker works for the seller and in turn works for the sellers best interest. A buyer’s broker works for a buyer and in turn works in the buyer’s best interest. Depending on what you are doing (selling vs. buying), you’ll want the agent to sign a seller or buyer’s broker agreement. These agreements legally and contractually find the agent to work in your best interest. A good agent will not serve in both roles and if you want to buy a home they are selling they’ll engage another agent.
Do they actually honor these agreements? Industry wide I’m not sure, but my experience in the past has been a bit hit or miss. My experience has shown that they do, but they also work primarily in their interest. We’ve dealt with 5 various agents during home purchasing history. All but 2 seemed to work in our interest. 2 however clearly worked in their own interest. The unfortunate part is that in both cases I wasn’t aware of it until it was too late. The home we have now and are trying to sell, we paid way too much for. About $40,000 too much for. Our real estate agent lied to us, and while I can’t prove it, falsified the fair market analysis. So we thought we were getting a fair deal, but didn’t find out until a year or two later we had been scammed.
Signing the broker agreement
Regardless of whether or not the agent is serving in a buyer or seller’s broker role, you will need to sign a broker agreement with them. Read through the agreement fully, and make sure you understand the terms fully. You can read more about the types of buyers broker agreements here.
Why get a real estate agent anyway?
Here are just a few reasons why you might want to consider using a professional agent:
- Have many resources at their disposal that the general public doesn’t have access to. They may even be aware of homes that are for sale, but not listed. This boils down to finding you more homes that match what you are looking for and in your price range.
- Provide more than just information about the home. They can provide information about the neighborhood, neighbors, schools, churches, utilities, etc.
- Assistance with negotiation. This isn’t just on price, but on other negotiable items as well.
- Assistance with the purchase process including types of required inspections, providing reports on the property and other important information and documents.
- Guide you through the closing process including providing recommendations for attorneys
- Professional advertising for your property. This includes accompanying people through your property and pre-screening potential buyers
- Assisting you with completion of all the required paperwork including contracts and offers.
Of course there are many other benefits, but these are the key ones. Both our selling agent and buying agent have worked out very well. Our selling agent has assisted us with pricing our home and making to show ready. Our buying agent knows the area very well and was able to find us the perfect house at a great price.
Photo by: lumaxart
What are your thoughts on using a real estate agent? Have a good or bad experience you’d like share? Add a comment!