Home Buying in Los Angeles>Question Details

Tbr, Home Buyer in Los Angeles, CA

As Buyer, what's the drawbacks of using the seller's agent to save on comm. costs? If youre seller's agent, how do you handle being

Asked by Tbr, Los Angeles, CA Mon Jul 25, 2011

on both sides? I'm getting into the market to buy a new home and am searching through listings online daily. A few look interesting and I want to contact the seller's agent directy but am unsure if this is the wisest choice. What are the drawbacks of using the seller's agent and if you are an agent, how do you handle situations where you are representing both sides (and trying to get both sides the best deal)?

Help the community by answering this question:


The main reason to consider using your own agent for a home purchase is that you are not working with someone whose commission is paid by the Seller.

Most agents are honest but is is very tough to represent both sides neutrally.

Also, not all listing agents are going to give up any of their commission and even those who do, at best would probably only give up 1% since they have to do twice the work to close the deal. So, for example, on a $500,000 purchase price you would save $5,000. This financed over 30 years, let's say at 5% would equal around an extra $35 a month.

Is it worth giving up your own representation for that amount, especially since your own agent might be able to negotiation better terms for you.

Just my 2 cents.
Web Reference: http://www.homejane.com
4 votes Thank Flag Link Mon Jul 25, 2011

I'm sorry to say this but the commission paid to the agent or agents is in the listing contract prior to the house being put up for sale. So where is the saving?? All your doing is helping the listing agent get both sides of the commission and giving up right to be represented. A buyers agent usually costs you as a buyer nothing and gets someone working for you. There is the savings.

As far as how we handle it if were are in a dual agency situation, we are obligated to be neutral. However, it has to be agreed upon ahead of time by everyone involved.

Good Luck,
3 votes Thank Flag Link Fri Jul 29, 2011
How do you figure that you are going to save on commission money as a buyer. As a buyer you don't pay for the agent, the seller does from his or her sales price, So that you understand the Listing agent has a contract that says all of the sales commission is theirs, so if you think you are saving anything you are wrong, the list agent then says in the MLS that if another licensed agent brings them a buyer they will split with that agents broker some of the sales commission. As buyer you can never receive a sales commission because you have no license! You will save nothing and you will then go before the Listing agent and no agent on your side to talk to, ask advice, or you can ask for advice from the Listing agent, try seeing what they advise you do as far as an offer goes!
2 votes Thank Flag Link Tue Jul 26, 2011
Some really great answers, but the best answer came in the form of your question. You asked "how do you handle situations where you are representing both sides and trying to get both sides the best deal?" Even before you asked that question, you knew the answer.

Experience shows, in a situation like this, you can't get both sides the best deal. The seller wants the most money, fastest close, shortest contingency period, and does not want to make any repairs. The buyer wants to pay the least amount possible, have a long enough escrow to satisfy themselves about the property and their loan, wants their contingency periods to run right up until closing and wants the seller to pay to fix all the problems with the house so they can just move in and start enjoying.

Find yourself an agent who will look out for your best interest. Find an agent who is like a pit bull. Someone who won't let go until they have negotiated the best terms for you. Find someone who will treat your money as if it were their own. Someone to help you make wise, well informed decisions about the give and take in the transaction. And when we hit any bumps in the road (I mean transaction) make sure to have a great negotiator/navigator on your team who will find a way over them, around them or through them for you. You often won't even know about a problem until it is solved. Finding an agent who protects you like this and who you enjoy working with will be well worth it. This will make buying your new home fun and an epic adventure. Dare to Dream.

Shel-lee Davis, QSC®
Certified Distressed Property Expert – CDPE®
Short Sale & Foreclosure Resource – SFR®
Certified HAFA Specialist – CHS®
SSG Pro®
Your Real Estate Consultant for Life
RE/MAX Palos Verdes Realty
424-2HELP12 (424-243-5712)
2 votes Thank Flag Link Tue Jul 26, 2011
2 votes Thank Flag Link Mon Jul 25, 2011
I have represented, buyers, sellers and had dual representations, and I have to tell you candidly that it is better to have a separate buyer and seller agent. As a broker I often assign one of my agents to represent the buyer in a transaction where I am the listing agent.

As a buyer, you may think that using the listing agent may give you an edge because they get dual commission that way, and some agents do think that way, but do you want that type of person representing you?

I always put my client's best interest first... if I have an offer that is better from a buyer's agent, I will recommend that one over the one that I procured that would result in dual representation.

There is far more to being a Buyer's agent than finding the property... negotiations, escrow, contingencies are complicated, even when things go well... then if things go sideways you need a good experienced advocate on YOUR side. Don't think that you will not need an agent only because you can find the property.

In other words, do you want an experienced expert advocate on your side 100% or do you want to share them with the seller?

Best of luck!

Ron Escobar, MBA
Broker& General Contractor
2 votes Thank Flag Link Mon Jul 25, 2011
The seller's agent will primarily look out for the seller's interests, while a buyer's agent will look our for your interests. Since the seller pays the buyer's agent's commission, it costs you nothing to work with a buyer's agent. You will find that working with a buyer's agent will make your home search and the buying process much easier.
2 votes Thank Flag Link Mon Jul 25, 2011
As a Buyer, it is to your advantage in many ways to use a buyer's agent who will looking out for your interest only in purchasing a property. They can give you their opinion when asked questions about the property condition, how the price fits the market and helping your to determine a price to offer. A seller's agent cannot offer these services unless they are a dual agent and even then are somewhat limited. It is hard to wear both hats although it can be done and some agents do it well but many, do not. However, a buyer's agent does not know when the property you are looking at is being shown or if other offers are coming in and when unless the list agents decides to pass that information along. It is always best when you are truly interested in a property to act on it and not delay for other offers may be being presented. Whether you choose a buyer's agent or one who is the list agent, make sure you are comfortable with that person and they have disclosed all the necessary factual information on the property and your rights as a buyer!
1 vote Thank Flag Link Fri Jul 29, 2011
sometimes your best thoughts are not the correct ones! Get a Buyers Agent and really save some money!!!
1 vote Thank Flag Link Fri Jul 29, 2011
You can work with the seller's agent as a buyer and still have a good experience, but it sounds like you don't have a relationship with a Realtor yet and therefore you're not sure who to trust. In that case, you could call a Realtor in your area that works specifically as a Buyer's Agent, or you can call some of your local real estate companies and talk to the receptionist. Ask them who they would use if they wanted to buy a house. Would they reccomend that same agent for their close friend or family member? You might not want to go with the busiest Realtor in the office because you will want lots of personal attention. A Realtor in my office does this (talks to the receptionist) when her family in other states needs a Realtor and I thought it was a good idea. Hope it helps you!
1 vote Thank Flag Link Tue Jul 26, 2011
Handle professionally for all parties HOWEVER many agents can't cut commissions due to broker restrictions AND listing agreement signed by property owner

Lynn911 Dallas Realtor & Consultant, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
1 vote Thank Flag Link Mon Jul 25, 2011
Hello Tbr,
You as Buyer must know and disclose your representation in a transaction. Select:
1.You can come on your own, solo; listing agent get full commission but owes no fiduciary duty to you, only to Seller.
2.Request listing agent to represent you; listing agent get full commission and owes fiduciary duty to you as Buyer and Seller. The question here is who gets a fair deal?
3.Get your own Buyer's agent to represent you; full commission is split between listing agent and selling agent. You as Buyer get the Utmost fiduciary duty from your selling agent or Buyer's agent representation.
4.Get your real estate attornye to represent you; same as #3 above but you must pay your attorney any other attorney fees.

Number 3 above is highly recommended.

Let me know if I can be of help in your real estate purchase.

Doug Perez
(323) 285-8864
1 vote Thank Flag Link Mon Jul 25, 2011
Who represents both sides? I represent the Seller, and I try to get the Seller the best deal, and I keep all of the commission!
1 vote Thank Flag Link Mon Jul 25, 2011

There is a conflict of interest when an agent represents both sides. I would look at it like Jane Peters does below. Put it into perspective by looking at how much money you "might" get off the purchase price.

Is it worth it to you for $5,000 to not have your best interests fought for fairly? I mean if you needed a lawyer for a legal battle would you choose to save $5,000 if you could have the other side's lawyer represent you?

One thing that I've noticed is that a lot of listing agents approach buyers at open houses and tell them that they will get a better deal for them if they work with them as opposed to their own agent. This is rarely true. And if it is, I go back to how much better is the deal, and is it worth it to not have your own representation?

Best of luck to you and happy house hunting!

1 vote Thank Flag Link Mon Jul 25, 2011
Hello TBR,


Buyers often fail to remember that the listing agent works for the seller FIRST. He/she has a contracted pre-established relationship with the seller. They probably know the names of their kids. They have already impressed upon the seller how they will get them the most money possible. I liken the buyer in that situation to a mistress. The listing agent is already married to the seller. Someone gets first fruits, someone gets what's left. Not to say that listing agents can't back pedal and take a non-bias role, but it can be tricky.

Please consider using your own representation.

Andi Grant, Realtor®
First Time Home Buyer Specialist

Start Your Los Angeles Home Search:
1 vote Thank Flag Link Mon Jul 25, 2011
You want a professional on your side. For example, if repairs are necessary can someone who represents both sides fight as vigorously for you. Probably not.
1 vote Thank Flag Link Mon Jul 25, 2011

First of you have to understand how the payment of commission process works. The commission agreement is between the seller and the listing broker (listing agent). So the seller signs a binding contract with the listing broker stating that when they sell the property, they will pay them a commission (lately mostly 5%). So contractually, that 5% commission will be paid to the listing broker whether they represent the seller only or both the seller and the buyer. The difference is that if the listing broker only represents the seller and the buyer is presented by their own agent, the listing broker will have to share that commission with your agent (2.5% each), but if the listing broker represents both parties they get to keep the entire 5% commission. So the only one who wins here, is the listing broker who pockets the whole 5%! Does that mean that the seller is going to lower his or her price? Not at all, because either way they are paying the same amount of commission. Even if the listing broker has a deal with the seller to discount him/her 1% if he represents both sides, that's all that means, it doesn't mean that the seller will sell you the property at a lower price! Either way, in the end, the seller will have to pay commission regardless of double representation or not and bottom line, they want their price!
Second aspect of your question and in my opinion the most important one, is how will you be fairly represented if the agent represents both sides? What do you think?....Trust me, I have sold over 180 properties in my career and it is very rare that a transaction goes entirely smoothly...At first, everybody is always very friendly but as the transaction progresses and deeper negotiations begins, things can get tensed and when that happens, how do you think the agent representing both sides is going to handle the situation? His original contract is with the seller, not with you...If he looses you as a buyer, he will still have his listing contract with the seller, which means you are replaceable, expandable...sorry...

So in conclusion, if you have the opportunity to have a professional represent you FOR FREE and defend your interests and the house won't cost you anymore, why wouldn't you have your own agent represent you?

I have this answers your question. I represent a lot of buyers, I am a very dedicated agent, always looking for a win win transaction and I negotiate the best deal possible for my buyers. Call me if you would like to discuss your project further.


Michel Bron
Web Reference: http://www.michelbron.com
1 vote Thank Flag Link Mon Jul 25, 2011
Although it is perfectly legal to do so, and many agents do, I personally will not represent a buyer on one of mu listings. For me, it is not possible to look after the fiduciary responsibilities for both clients on the opposite ends of a deal.

I think it serves you best to have your own agent who is aware of your needs and concerns, and who can really be your advocate to get you the best possible deal on the house you want.

Talk to your friends and relatives. I am sure they can recommend an agent who they like and work well with. Interview at least 2 to find an agent you feel comfortable with. An agent can help you with all aspects of finding a home, nit just writing a contract. A good agent will become part of your team, looking out for your needs, and making sure you are not taken advantage of.

Good Luck
1 vote Thank Flag Link Mon Jul 25, 2011
There is absolutely no financial benefit to using the listing agent to represent you in a transaction. Compensation is agreed to by the Seller and the Listing Broker at the time of taking the listing, as is the amount of compenstion offered to the Buyer Agent. All compensation is paid by the Seller. In effect, you are paying the Listing Agent a 100% bonus for working with you.
The conflict lies in how to best represent BOTH clients to the best of your ability and in conforming with Agency Standards (and the law) when attempting to represent both parties. How do you handle confidential information told to you by one party, when you owe an equal duty of disclosure to BOTH parties? Therein lies the rub.
For my money, no pun intended, I would get an Accredited Buyer Representative (ABR) to represent me. It costs you NOTHING, and you have someone whose job it is to represent YOUR BEST INTERESTS, not the seller's.
Deborah Bremner
The Bremner Group at Coldwell Banker
REALTOR, 00588885, ABR, CDPE, eAgent, CSP, SFR, HRC, CRE
(O) 310-571-1364 DIRECT
(D) 818.564.6591
Accredited Buyer Representative|Certified Distressed Property Expert |Pre-Foreclosure Specialist Certified
I want you to know that I appreciate any referrals from friends and associates who may be in the market to buy or sell real estate. You can count on me giving them the same high-quality service I provide to all of my clients.
1 vote Thank Flag Link Mon Jul 25, 2011
Using the listing agent as your broker will not get you any credits from his or her commission in most cases. Especially if there are multiple offers, this can be an ethics issue that agents will avoid. You will save a lot more money by having your own agent, which costs you nothing, and will fight for your price and terms to get you the best deal possible. An experienced buyers agent that knows the market you are looking at is without a doubt the smartest move in any circumstance. The listing agent is a fiduciary to the seller of the property first, and while dual agency is certainly legal and happens once in a while, it is a conflict of interest and puts the agent in a challenging position. I usually avoid this situation unless I feel that everyone is comfortable, and even then it is risky.
1 vote Thank Flag Link Mon Jul 25, 2011
As an agent I owe a duty to both parties to act ethically and honestly.

As a seller's agent I can not disclose the seller's bottom line, so if you think you're going to have an advantage using the seller's agent you will not.

The buyer does not pay commission. The commission comes out of the seller's proceeds, thus as a buyer it should not matter to you about the commission.

I will usually refer the buyer to another agent, so that there is no hint of impropriety. I want both sides to feel comfortable with the transaction.

Call me directly and I can assist you further.

Thank you,
1 vote Thank Flag Link Mon Jul 25, 2011
Dear Tbr

In is in your best interest to have your own agent represent you. Having the seller's agent represent you will not save you commission costs as the seller pays those costs. The seller's agent is just that- the seller's agent and has a fiduciary responsiblity to the seller first. You need someone that is looking you for your best interest and will lead you thru the transaction to protect you, education you and fight for you.

Kimberly Burnett
Sotheby's International Realty
1 vote Thank Flag Link Mon Jul 25, 2011
I personally don't practice dual agency for a multitude of reasons. I would advise you to seek out an agent to represent your best interest. It is so important to have someone on your side to offer advice,negotiate on your behalf, and guide you through a smooth and successful transaction. If you are looking for a deal, hire a skilled negotiator. :)
Wishing you the best,

Kenya Costa ABR,SFR
Keller Williams Realty
1 vote Thank Flag Link Mon Jul 25, 2011
Hi Tbr,

Drawbacks: you don't have anyone on your side. The listing agent has a fiduciary duty to the seller first...and then you. And, since the seller pays the commission, not the buyer, you wouldn't be saving any money on commission by using the listing agent.

Please do yourself a favor and find an agent who you can trust to help you through the entire real estate process. One who will work hard on your behalf to get you the best deal and one who will be there for you even after escrow closes. Having an agent on your side is how you can save the most money.

Personally, I don't like to handle both sides. It can get a little sticky. If I have a listing and a buyer wants to write an offer on my listing, I will refer the buyer out to another excellent agent in my office so both the buyer and the seller are represented equally.

Good luck!
0 votes Thank Flag Link Wed Aug 3, 2011
In most areas of the country, you will NOT save any money calling the seller's agent. They will just get the entire commission and will have to give each of you less service. It is such a no-brainer to research and use your own agent. Even the federal government thinks it is a good idea. The latest Shopping for your Home Loan published by the federal government agency, HUD, recommends using an exclusive buyers agent. That type of agent ONLY represents buyers.
0 votes Thank Flag Link Wed Aug 3, 2011
It is really all depends on how knowledgeable the buyers are. If the buyers have bought many homes in the pass few years, in same area, then I am pretty sure that the buyers will do just fine. But the reality, most buyers need assistant, and it is the best interest of buyers to have a professional handled the buying process. There are more things to go wrong that right.
Web Reference: http://www.teanwong.com
0 votes Thank Flag Link Fri Jul 29, 2011
Short and sweet: Do not contact the Seller's agent. Obtain your own agent, then find out if the property is even available. Often what the public sees is different from what the agent sees. The most current and up-to-date information is available only to MLS members. I have had buyer clients who thought they were helping by searching a bunch of real estate websites. 99% of the properties they found were not available, either sold months before or never even on the market. All the info shared with you by the agents before me was perfect. You just need to find the right agent for you, the one you will click with. Good luck!
0 votes Thank Flag Link Thu Jul 28, 2011
Dear Tbr,
The drawbacks to dual agency(although legal in the state of California) would be that it is difficult to represent both the needs and desires of the seller, as well as the buyer. It's not hard to imagine.The seller's agent's job is to get the highest price for that property...how could that benefit you as the buyer?
It costs nothing to retain a buyer agent to represent you, and it is in your best interest to do so. You won't save a single penny going without one.

So the question is..why Not use a buyer agent?
0 votes Thank Flag Link Wed Jul 27, 2011
Hi Tbr:

Everything is negotiable and must be in writing. If you want a discounted commission rate from your agent if they represent both buyer and seller, then it must be in the listing agreement, in writing.

In most cases, with reputable real estate companies, most managers will want to see the listing agreement and also the purchase contract to review and make sure there are no conflicts and that everything is being done upfront, and with integrity. Remember that the agent has a fiduciary relationship with whom ever they represent.

The bottom line is that what ever offer is accepted, be the Buyer being represented by the listing agent or another agent, the listing agent must do what is in the best interest of the Client/Seller.

In your case, it would be in your best interest to have an agent represent you to make sure your interests are being handled in a professional way.

Good luck!

All the best,

Kat Becker, Agent
Prudential California Realty
0 votes Thank Flag Link Tue Jul 26, 2011
It may or may not be a wise choice based upon the integrity of the Agent.

An Agent who represents both Seller and Buyer may only look at the "end product" which would be double comssion for themself...and do and say "whatever it takes" to close the deal. An Agent/Broker with "integrity" will provided fully disclosure on the property and any possible concerns for both seller and buyer. So...if you think you want to do this try to find out as much information about the agent before you make a contract with them.
0 votes Thank Flag Link Tue Jul 26, 2011
The obligations of the seller's agent varies by State. In Texas, for example, we no longer have dual agency, but now have intermediaries. With the consent of both the buyer and seller, an agent may act as an intermediary. However, in that capacity, the intermediary cannot give advice to either party, instead acting only as a "go-between." Some brokers require that a second agent within his office be appointed to act as the buyer's agent, while the listing agent represents the seller; thus the broker becomes the intermediary. All said, if you want someone to represent only you then you should have your own agent.

Jack Gillis, M.B.A., J.D.
Jack Gillis Realty Advisors
Nathan Grace Real Estate, Broker
5619 Dyer Street | Suite 100
Dallas, TX 75206
Cell: 214.718.4910
Email: Jack@JackGillisRealty.com
0 votes Thank Flag Link Tue Jul 26, 2011
While I agree with what the other agents have answered so far, their primary fiduciary duty is to the seller and it probably won't save you any money to have your own representation, you should also look at the benefits of having a dual agent (one that is working for both the buyer and seller) if you like and trust them.

A seller tells his/her listing agent what price, terms, etc he/she would like to have and that info is publicized usually in the MLS as well as other advertising. The agent should be advising their client whether buyer or seller what comparable properties are selling for and listing for. This information is based on recent sales. It is what it is, for both seller and buyer. That doesn't mean the seller will listen or buyer will listen. Sometimes Sellers need to sell quickly and will accept a very low offer. Their listing agent has a much better feel for this than a buyers agent looking at the given info on a sheet of paper. Other times it may be the opposite. The seller is just testing the water and is very firm on price/terms, your buyers agent can "fight for you" all they want but the seller still wants what they want. The listing agent has a lot more insight into what reasonable offer will work instead of guessing like a buyers agent would.

I believe that we as agents are just the middle men giving our clients the information so that they, the client, can make an informed decision. Whether I am representing seller, buyer or both it is not for me to decide what they want to offer or take. I just give them all the info. I ask buyers the questions that make them decide if this property is the right one for them whether it is my listing or someone elses.

I would like to equate the purchase negotiation to a divorce, You can have two lawyers bickering back and forth on who will get the couch or whatever, or you can have one mediation minded attorney represent both helping each give a little but get a happier resolution without all that bickering and bad feelings. Cut to the point faster and easier and more likely all parties will end up happier. After all a seller wants to sell and a buyer wants to buy, right? My job is to make the negotiation and transaction as smooth as possible while helping my clients get what is most important to them.

Now, even after saying all that, I think you will probably be better off finding ONE agent to represent you and help you look for properties and negotiate on your behalf. Why? Because you want to be sure they are competant and can take care of you properly. So, you should develop a relationship. You should get to know, like and trust your agent. You need to feel they would be able to pick up the ball if it gets dropped. They should be able to explain the process and what is likely to happen and what is normal and customary as well as not. Look for an experienced agent, get referrals, see if you "click" together. Are they asking you the questions before you ask yourself on why this home will or won't work for you? Are they helpful or just yes men? Don't let anyone talk you into anything. Your agent should be your partner and advisor. Use someone you think you want to trust.

Lastly, you may find your agent at an open house and they may end up representing both sides if you fall in love with that house. And that is OK. Or not. There are a million of us all around you...Tell a few people you are looking for an agent and they may give you a great one or you could always call one of the many agents who answered your question (me, me, ME!). It is OK to interview agents or even change if you are not happy while you are developing a relationship and looking (not in the middle of a transaction in which case you should call their broker if you are not happy).

This is a service business and you should get the service you want from your agent.

If you would like to call me, text me, or email me, I'll be happy to help you on the Westside of Los Angeles and surrounding areas.

Lucia Ferreira
Sunset Palms Real Estate, Inc.
cell (909) 936-0000
email: Lucia@SunsetPalmsRealEstate.com
0 votes Thank Flag Link Mon Jul 25, 2011
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