| SELECTING A REAL ESTATE AGENT TO HELP YOU BUY A
HOME
Q. How does a buyer choose a real estate agent?
A. Buyers have two options in selecting a real estate agent--they
can work within the traditional
system of listing and showing agents, both of whom represent and are paid
by the seller, or they
can hire a buyer's agent. If the second option is selected, the buyer
may pay a fee to the agent for his or her services but the agent is responsible
only to the buyer. In either case, you will want to look for an experienced
agent familiar with the neighborhood that interests you. Interview several
agents. Ask about the agent's sales for the last six months or a year;
what was the average time needed to find homes for buyers; how many people
have bought homes through them; and what kind of homes were sold. Ask
the agent for the names of recent buyers who used his or her services
and talk to them. You should be interested in how much time the agent
spent with the buyers, how helpful he or she was during negotiations,
and whether they were satisfied with the services provided.
Most people prefer to work with experienced real estate agents. Two years'
experience is
a good rule of thumb. Experience in handling closings is important as
well. Obviously, if an agent has had two years' experience but has closed
only two transactions during that time, the agent may be less experienced
than one might like.
Also make sure that your agent has a good record of locating the types
of homes specified
by prospective buyers. For example, an agent who customarily has clients
seeking $500,000 homes may not spend much time working for a client seeking
a $100,000 home. Remember, unless a buyer is working with a buyer's agent,
the agent's commission depends on the selling price of the home. Thus,
an agent may spend more time with a client looking for a more expensive
home.
Most importantly, before you start working with an agent, try to make
decisions about the
type of home you want, the amount you are willing to pay, and all the
other important aspects of home buying. Shop open houses to get a feel
for various neighborhoods and the style of home you are seeking.
Couples should be in agreement on how much they are going to spend and
what type of
home they want. Agents quickly become frustrated when a couple, or any
two people buying a
home together, seem to have different things in mind.
Q. What is the fee relationship with a buyer's agent?
A. Most buyers prefer to have their agent's fee paid by the seller
to avoid additional costs. But,
remember, this preference may commit the buyer to the traditional arrangement
in which the
listing and showing agents both work for the seller. Any buyer who is
uncomfortable with this
situation may enlist the help of a buyer's agent who will represent only
the buyer.
A buyer's agent may require a nonrefundable fee, which will vary with
the length of the
home search and the extent of the services provided. If you choose this
option, you will want to
have a specific contract which, as with all written contracts, should
be reviewed and approved by your lawyer. The contract should specify the
services to be provided and the fees you will pay. If possible, avoid
having the fee connected to the purchase price of the home. You do not
want to provide an incentive for your agent to encourage a more expensive
sale than you want. It may be possible, however, to specify in your purchase
offer to the seller that your agent's fee will be paid by the seller at
closing.
To find a buyer's broker, check the yellow pages of your telephone book
or call the local
real estate association for referrals.
Q. What should I tell a real estate agent about my personal situation?
A. If you have a buyer's agent, you may feel free to discuss
all aspects of the sale. If you are
working with a traditional agent, you may want to withhold certain information
that could be
useful to the seller. Remember, unless you have hired a buyer's agent,
the showing agents you are working with actually represent the seller
and are required to disclose all relevant information you might give to
the seller.
Some people suggest that you disclose only home styles, prices, and amenities
you want
when working with a traditional agent. Personal information, such as the
fact that your lease
expires in two months or that you are willing to bid a higher price on
a home, could be conveyed to the seller and ultimately hurt you in the
negotiation process. You also can avoid discussing financial information
that could be shared with a prospective seller by pre-qualifying for a
loan.
Some Advance Work Before You Buy
If you are a prospective buyer, postpone offers and negotiations until
you get a feel for various
neighborhoods and the style of home you are seeking. Shopping open
houses is an excellent way to do this. You also may want to be pre-qualified
by a lender for a mortgage before you have a specific home in mind.
This will require filling out financial statements, making the necessary
financial disclosures, and having your credit record checked. This
will give you a rough idea of how much money the lender will loan
you and, thus, make it easier for you to pinpoint your price range. |
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