Erroneous assumptions about the real estate business can cause a ton of confusion for the public about how the real estate process works. Buyers and sellers often have misconception about the buying and selling of a home. How the process works and what the agent relationship is all about. It is helpful if you are thinking of buying or selling your property to know a few myths about the process. We would like to give you a few myths and truths about working with both buyer’s and seller’s agents…
Myth: 6% is The Commission, No Matter What
That is just not accurate.
The Truth… Commission is split 4 ways, between the the two agents, (the buyers agent and the seller’s agent) and the two brokerages. The seller pays the commission and it is not set in stone, the seller can sometimes negotiate it.
Myth: You Cannot Change Your Agent
When you decide to sell your home you usually choose a real estate agent and their brokerage. At that time you sign a contract usually 6 months or one year. Once you sign that contract you could in fact be stuck with the agent through the term. But that is no always the case.
The Truth… If things are not working out between you and your agent, it is possible to ask the agent or the brokerage manager to release you from the contract. Buyers are not under a contract. The buyers agent does not receive funds until the buyer finds a home. Sometimes a buyer never finds a home they want to purchase so the agent does not get paid. Spend a few hours with your agent and see if they are a right fit. If you do not feel conformable let them know early.
Myth: There is No Harm Buying a House Using Just the Sellers Agent
You go an open house and meet the seller’s agent, who seems really cool. You want to make an offer, but you don’t have an agent of your own. So what’s the harm in just working with the seller’s agent? In the real estate biz, one agent representing both the seller and the buyer is called dual agency. Or you as a buyer can just use your smart phone since most property listings are online.
The Truth… First time buyers or buyers new to the area need an advocate. The listing agent represents the seller’s interest and has a fiduciary responsibility to negotiate the best price for the sells. So working for the buyer and the seller could be a conflict of interest. Also a buyers agent lives and breathes their local market. They will know the best inspectors, lenders, architects, and attorneys. They will facilitate your transactions, they know all the red flags. So as a buyer have your won agent. they will be working hard for you.
Myth: One Agent IS As Good AS Another
Many people think any agent can facilitate a transaction so what is the difference who we use as an agent.
The Truth… As in every profession or organization, there are those who are committed to excellence, devote endless amounts of time and energy into working with buyers and sellers and are highly adept problem solvers. Others simply march to lower standards and do the bare minimum to get by. Consider an agent who has lived and worked in the same town for around ten years. They know the area, they have deep relationships with the other agents. They have the inside knowledge on upcoming deals.
Myth: When I Have An Agent, I Cannot Buy a For Sale By Owner Home
Sellers will not work with any agents, so since I have an agent I cannot purchase the for sale by owner home.
The Truth… Do involve your Realtor. Many private sellers are willing to co-operate with Buyers’ Agents. They know the paperwork will be handled correctly and that the buyers have been properly qualified to make the purchase. If the private seller is unwilling to pay a commission you will need to pay your Buyers’ Agent. But you can do so with the assurance that he/she is working for you and that the deal will be constructed with your best interests as the foundation.
Tom has 20+ years experience in helping his clients buy and sell properties. Tom is also great resource for trusted vendors that can help assess and fix a property before buying or selling it.
About Tom Reese
Helping my clients attain their dreams has been the foundation of my success. With my strong attention to customer service, I have earned my clients continued support and referrals. Put my enthusiasm and dedication to work for you!
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Tom may be new to rapping but he’s not new to real estate!