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Why Hire A Buyer’s Agent
A lot of home buyers go about sieving through listings and viewing properties themselves without any help from any real estate agents.
Some don’t even hire one after an agreement has been made to purchase a house and preferring to use the seller’s agent to do everything required for them for closing.
And this do this for good reason.
Hiring an agent to help find a suitable house to buy can be costly.
In addition, more and more home buyers prefer to look through property listings themselves and deciding on which ones to view.
Why pay someone to do this when you would be doing these tasks anyway.
Moreover, there’s always the chance that an agent don’t really understand what a buyer desires and fails identify listings that perfectly fit the buyer’s criteria.
If you have ever worked with an agent that was helping you on the buyer side, surely you must have experience the weird occurrence of finding a suitable home listing but never hearing about it from the agent.
And then end up having to call your agent to arrange an viewing appoint for you… which is a just a phone call you could have easily made yourself.
But despite all this negatives with hiring agents to help you buy, it not wise to go about this without an agent on your side of the negotiating table. Especially when you are a first time home buyer.
Yes. You could very well accept the “free” services of the selling agent to close a transaction. But you don’t need to be a genius to realize that this is not an agent who is looking out for your interest.
A friend of mine once had an offer to purchase an apartment in Manhattan accepted without any assistance from any agents. He found the unit in an online portal, called up for the open house, made an offer to buy, negotiated the price, and finally had it accepted. It was all done within a day and he was pretty pleased with himself that he secured a fair price all by himself. On the next meeting to finalize all the terms of the deal, he realized that he had walked into a nightmare as the agent and seller started to present very unfavorable terms that were only to their benefit. They even insisted that they were industry practices. Even though he was not an expert in buying real estate, was smart enough to sense that he was being bullied and called me. He was indeed being taken advantage of and I simply asked him to link up with an agent I trusted to help him. On the next meeting, his now agent who was a very experienced guy blew back everything and they found a middle ground that was fair to both parties. If he had kept his head down and quietly accepted the terms first presented, he would have to be homeless for 3 weeks as the seller wants to stay in the residence way beyond the date that they finally agreed on.
You can’t fault the seller or selling agent for the rabbit they tried to pull out of the hat. It’s just business. And if you indeed fall as victim to these unscrupulous practices, you can only blame yourself for not having an agent on your side to look out for your interest.
When there are parties who have no agent representation, it is usually on the buying side.
This is party due to the reasons stated previously and that seller agents would usually provide just enough assistance to drag the deal over the line. They have an interest in the closing after all.
But do not think for a moment that a seller agent is on your side. They are hired by the seller, remunerated by the seller, and would continue to live off referral clients referred by the seller.
They have no loyalty to buyers and only a fool would think otherwise.
The disturbing part is that there are still a huge number of home buyers who call up contact numbers they find on listings, posters and yard signs to inquire about the property for sale.
They are then put through to the selling agent and don’t know that these are not neutral agents, but are under the payroll of the seller.
So they put their trust on the selling agents while allowing themselves to be ushered into deals that don’t favor them.
Having a buyer’s agent would offer a form of protection against unethical sellers and their agents.
The problem is that they charge a finder’s fee for matching you with a house.
This might seem like a waste of money for some home seekers. But from the point of view of a agent, it is compensation for the work they put in for helping find a suitable house.
Some buyers even get clients to sign exclusivity contracts that prevents a buyer to avail the services of another agent. This means that as long as a buyer under such contracts buys a house within a specified time period, they are contractually obligated to pay the agent.
Terms like these are the reason why people avoid buying agents.
If we take these contracts to the extreme, it basically means that as long as a property agent is able to coax a home buyer into signing an exclusivity contract, they can pretty much sleep at home and wait for payday to arrive.
Others might insist that there are conditional provisions that allow a buyer to terminate such contracts. But in reality, is anyone going to waste time collecting that evidence to prove it? And do buyers even have time for it as some might be homeless within a few weeks?
Many people would simply refuse to hire buyer agents not because of it’s costs. But because it’s a matter of principle.
On top of that, why should one pay an agent if he found a house himself and bought it? It makes no sense.
Yet one cannot deny that having an agent by his side would only be helpful, especially when one has no experience with buying real estate at all.
A simple thing you can do if you still choose to do your own house hunting is to engage the services of an agent only after having agreed to buy a house.
The agent can help to negotiate the terms and guide you on closing procedures to follow.
Most agents would agree to provide such services with a flat fee.
They have gone through closing numerous times and might consider it effortless. It’s easy money without the hassle of property hunting.