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FIRST TIME BUYER – We're on our way!... now, an etiquette question

Asked by Voices Member, Mon Jan 7, 2008

My husband and I each phoned a mortgage lender on Friday, both of whom came highly recommended by friends and family, and each had very good conversations and came home feeling very happy! We spent the weekend getting the info together that we were asked for, and began filling out a loan app, but were also surprised to have been contacted by 2 realtors – one recommended by each lender.

I understand that it's a good idea to have more than one broker so we're able to feel them out and compare the specs they come back to us with, but should we really get into it with two separate realtors? They both sounded very interested in helping us and know the area "like the back of their hands," but it feels weird that at some point we'd have to say "Sorry, we're going with a different realtor"... especially if they'd done quality work in bringing us closer to finding our home!

So what's the etiquette when it comes to multiple realtors? When is the right point to make a descision on one?

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Answers

20
Most of the earlier answers were good. I disagree with Greg's idea. If a single agent knows both areas, and is a member of MLS in both areas, .It is better to stick to one agent, who understands YOUR needs and wants, and also understands the whole metro area, as well as your favorite neighborhoods.

Bricks and sticks are the same in Chicago as they are in Oak Park, or Aurora for that matter. The idea that consumers need a neighborhood specialist is promoted by many Realtors for personal marketing purposes. There are many more generalists that can serve you anywhere in their metro region.

Your best house might be in a neighborhood that did not cross your mind the first time.
Realtors should know their towns, but they don't represent them, they represent their clients.
6 votes Thank Flag Link Tue Jan 8, 2008
Jim Walker, Real Estate Pro in Carmichael, CA
MVP'08
Contact
Hi,

I read the responses in order posted and kept waiting to hear, “negotiation”, and finally got to it when I read Ruth’s post. Much good input on the thread so far.

I wouldn’t be overly suspicious or cautious simply because you received a referral from mortgage broker. Mortgage brokers know many Realtors, and can pick the cream of the crop. Contrast the referral that comes from a co-worker who has a sister who is an agent where there is a personal desire to be supportive of a relative. As in any referral, I suggest that a buyer or seller take the information as a “potential” realtor and do not feel obligated to retain that person. You have two referrals, and you might end up with one of these Realtors, or even a different one.

In your initial home search, it is perfectly acceptable to talk with more than one Realtor before choosing a representative. Be upfront with those you engage in conversation, and let them know you have not yet chosen your buyer agent. Agents (99%) work on commission, and in the early stages are competing for your business. That’s OK. Since agents do work on commission, be aware that if you visit homes with a Realtor, that Realtor will most likely establish a claim for the commission on that property if you should choose to make an offer/purchase.

Ask lots of questions to help you determine who you believe will be the best representative for you. In choosing a buyers agent, look for strengths in the following areas:

1) General real estate knowledge: You want your Realtor to intimately know what to watch for through a transaction. While Realtors are not building experts, they should be able to recognize, address and discuss the fundamentals about a property. Realtors need to be able to advise each step of the sales process and know how to overcome obstacles and solve problems. Good connections and experience help. Ask questions about various properties, the type of heat systems, roof, etc. Ask questions about the process of buying, when and why a title search is run, when and why a survey is done. How the agent answers these questions will be an indicator of how they communicate, explain, and their own level expertise.

2) Knowledge of the local area. Does the agent know the housing market? Can they advise you about recent trends? Have they been in many of the properties currently for sale? How do they compare? The more your agent knows about the area, the more they can share with you.

3) What is the skill level of a prospective agent? Is he/she a good presenter? Good listener? Can they negotiate well on your behalf? Can they take the knowledge of the market and use that information to achieve the best deal for you. Contrast an attorney who knows the law, but cannot address a judge or jury well. Your agent must be able to foster good working relations with other Realtors while remaining your advocate and top notch negotiator. Will the agent present offers in person to the seller? Will they be a good representative on your behalf? Can the person talk numbers to the numbers person if needed?

4) Will the agent work hard for you and employ a working style that fits your needs? Do you need the agent to contact FSBOs on your behalf? Will they invest the time and energy on your behalf? Are they reasonably available? Do they communicate via email? Phone? What is best for you?

Choose the agent who is best of you, regardless of source. Be upfront and honest in your evaluation period. Once you make a decision, let everyone know. Best of luck in your home purchase.

Deborah
3 votes Thank Flag Link Sat Jan 12, 2008
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
Hi Jane,

Buyers should work with one agent only. The vast majority of Realtors are members of the MLS and have access to the same market data so having 2 Realtors would just duplicate the data if both work as diligently for you, as they should, in finding you a home.

It's also very important to ensure you're working with an agent that knows the market in general, including the type of product that you're interested in (single family home, condominium, new construction or resale).You should feel comfortable with the person you work with but ultimately Real Estate is not a personality contest.

Real Estate can be a part-time job but in reality that doesn't serve a client well. A part-time realtor only has their finger on the pulse of the market part-time. The same can be said of full-time Realtors that only do a few transactions a year. The majority of transactions in the MLS are handled by a small percentage of the agents working in the business. Ask all the Realtors you talk to how many transactions they've handled in the last 12 months and throughout their career. That way you should get the information you need to make an educated decision to choose one Realtor just as you would crunch the numbers when it comes time to compare comparable properties when you're about to buy or sell a home.

The fun part of Real Estate is viewing the various properties available on the market. Fun can rapidly turn to frustration if a transaction isn't handled correctly from start to finish. Real Estate can get very emotional for everyone involved and it's good to have a Realtor experienced in numerous transactions working for you that can advise you should issues arise.

When you have answers to the above, you'll be at the right point to make a decision.

Best of luck.
Web Reference: http://www.KDRchicago.com
2 votes Thank Flag Link Sun Jan 13, 2008
Jane, the agents are here to educate you. I'm here to educate the agents.

OK, I finally found what I was looking for but I keep receiving *Your answer doesn't appear to be valid.* I will be emailing my long post to several of the Top Voices here. Please email me if you would like to receive my explanation why I gave an unusual answer below. Here is part of it though:

I do NOT know city real estate, I know the suburbs. I work everywhere in the city (as a Children's Party Planner, not a Realtor). I could be in two identical homes "in the city" and one might be worth a little more than $100,000 and the other a little less than $1,000,000. See these two examples:

8519 S Hermitage Ave, Chicago, IL 60620 number 06679640 $150,000

2654 W Wilson, Chicago, IL 60625 number 06660013 $985,000

Compare at chicagotribune.com/classified/realestate/

I know that one side of the street verses another can be a difference of several HUNDREDS OF THOUSANDS of dollars. I know there are some great Chicago agents here on Trulia. The one person I thought of when I suggested Jane search other posts is Ken Dooley. He's been on Trulia for over 6 months. He only has one-fifth the number of answers as Elvis who has been here only a month and both of these Real Estate Pros have impressed me (weaker than usual answer here Elvis). Jim Roth, Patti Pereyra and Thomas Hall are all impressive Chicago agents that I think need to chime in here (I'll email them).

One of Ken Dooley's best answers and interesting subject matter is Myth or Fact.

One other quality I think an agent needs is analytical and math skills. And yes Jane, you can discern an agent's negotiating skills. Ask them what percent the sales price was compared to the asking price for when they were a buyer's agent and also for when they were the listing agent. If the answer is 90 percent for the buyer's agent and 99 percent for the listing agent, you've got yourself a sure fire winner. If they are both 98 percent, I'd pass and find another agent. Just my opinion on being able to quantify negotiating skills. I have enough confidence in knowing the price I want that personality in my agent is more important for presenting my offer.

Thanks everyone for reading. Now to contact the other Chicago agents to give their opinions.
Ruth
2 votes Thank Flag Link Sat Jan 12, 2008
Ruthless, Other/Just Looking in 60558
MVP'08
Matt left out negotiation skills, and so did everyone else.

Jane:
You have received lots of good advice, even good advice that conflicts with another person's good advice. For example, Greg's advice comes from the odd nature of Chicago Realtors sticking too close to home. Jim's advice although excellent might NOT be realistic. Yet if you currently rent in Jefferson Park and you are trying to decide whether to buy in Jefferson Park or in the Loop, who are you going to have advise you which area would be better? The JP agent would of course tell you buy in JP and the Loop agents would say the Loop. And a neutral agent might say their own area or not know enough about both areas to give you good advice.

Sorry to make your simple question even more difficult for you. I agree with Tom and believe that the reason he received thumbs down is because some people would perceive him as self promoting. I'd go through an look at his 12 answers (click on his picture) and decide for yourself if you think he gives good advice or is promoting himself.

Personally, I'd be skeptical if the mortgage lender had agents call you instead of giving you their name/number and you calling them. Not only would I be skeptical of the agents and the relationship between the lender but I would now be skeptical of the lender as well. Usually I advise "when all else fails, go with your gut" but NOT in this case. The definition of a "CON" man/job/scam is gaining your CONfidence. Please wait to sign ANYTHING with anybody until you have receive MORE advice for CHICAGO agents here.

Please Jane, spend some time reading as many of the Cook County responses here on Trulia as you can to get a feel for some of the helpful Chicago agents who could direct you to the right people. At the top of your questions it has:
Home>Trulia...>Illinois>Cook County>Chicago>...
Click on "Cook County" and just start reading responses from agents whose profile says CHICAGO, or IL.

It's 2:30 am, I want to return to this when I'm not so tired.
Ruth
2 votes Thank Flag Link Sat Jan 12, 2008
Ruthless, Other/Just Looking in 60558
MVP'08
Jane, it will feel weird having to tell one of the agents thanks alot for all you have done but we are using someone else. I agree with you and would recommend speaking to as many realtors as you need, until you find the person who seems to understand your needs/wants/situation. Be honest with everyone you speak with/interview that you are talking with a number of realtors in order to find the right one. But choose one, agents are independant contractors and only earn a commission if and when a contract closes. Having multiply people search the same area, I don't believe is very fair and honest way to be a working relationship. Best of luck with your house hunting.
1 vote Thank Flag Link Sun Jan 13, 2008
Hi Jane - (thanks for the heads-up Ruth!) Tough dilemma - but a good problem to have in my opinion. Interestingly enough, I was faced with a similar situation three years ago, however, I was one of the agents that had been highly recommended. My client was relocating to Chicago from the East Coast. She was upfront with me explaining that she was completely unfamiliar with the area and was unclear as to which individual could best assist her in her search. I appreciated her explanation and explained to her what I could do to assist her in her search. We spent 2 weekends looking - afterwards she decided to look with another agent. I continued to touch base to see how her search was progressing with no response.

Several weeks later, I received a phone call from her asking for my opinion regarding how to proceed with an offer on a property the other agent had found for her. While I was happy to hear from her, I was uncomfortable with the situation and explained to her that while I was happy to provide an opinion, she already had representation - she was frustrated but understood my position as well. Honestly, my hands were tied. The good news for me, however - she called me last fall to buy a new place and I was able to find her a new home!

Moral of the story:

I think it is extremely important to be upfront with the agents regarding your situation - in my opinion, agents appreciate that potential clients are upfront. Spend some time with each if you are unsure about which agent to choose. Honestly, very few buyers take the time to really find an agent that clicks AND has the knowledge and resources to truly work in the buyer's favor. If a potential agent doesn't like the arrangement, I don't believe they are a good fit. They may make a different business decision to spend their time and energy elsewhere - that doesn't make it bad, it just means they aren't a fit for you.

I don't always click with every potential buyer or seller prospect - I tell it like it is - however, I am EXTREMELY diplomatic :) ... if I don't feel the connection, I may not pursue the opportunity as aggressively. The real estate business is a relationship business - sometimes it's tough not to take things personally, however, the reality is - we don't always click.

I don't necessarily agree with Ruth about being skeptical regarding the referral coming from a mortgage broker. True - not all people have the buyer's interests in mind when referring clients, however, in my case, I am very lucky to have a mortgage broker who is ethical and has the sole interests of our clients in mind - sometimes even forgoing commissions etc to insure they get the best deal possible. To Elvis' point - like minded people tend to work together. I am lucky that I have the ability to work with truly professional mortgage professionals and great attorneys.

That's my story and I'm stickin' to it!
Web Reference: http://www.thomasjhall.com
1 vote Thank Flag Link Sun Jan 13, 2008
Negotiation... a great nebulous skill. Unfortunately it's a difficult skill for our clients to be able to discern and they often won't know if we're good negotiators until it's too late.

Since they'll have some trouble figuring out our negotiation expertise, I'd suggest they try to get a handle on our personalities. Are we outgoing, provocative, argumentative, alienating, friendly, gregarious. I find that the agents who are agitating, are also agitating negotiators. Agents who are annoying and whiney, are annoying and whiny negotiators.

And to extrapolate that one step further, I've noticed that annoying agents tend to attract annoying clients, excell-based agents, tend to attract excell-geek clients. Look for someone who's personality complements yours (I said complEment, not complient)... someone who adds something to your personality, yet meshes nicely. You're going to be spending a lot of time together, and some of that time will be stressful, you want it to be with someone who can relate with you well.

As everyone else has said, it's okay to work with two agents initially... set a time frame to make your decision, and be upfront with them. It's okay that they know they're competing for your business. Realtors are used to pressure... this will be a good indicator of how they operate.
1 vote Thank Flag Link Sat Jan 12, 2008
Alan May, Real Estate Pro in 60201
MVP'08
Contact
Jane,
Congratulations on preparing to buy your first home. Sorry for your unease, but I agree with several of the previous comments that relate to the significance of your endeavor. One thing for you to consider is that this is probably the most significant single economic investment in your life. As such it is critical that YOU make the decision as to who your realtor will be. Great that each of the mortgage brokers you've contacted has provided you with their recommendations. Interview the realtors they have steered your way. But one of two things you may want to do are 1) talk to your friends and find out who they have used, trusted and would recommend and 2) go to open houses in the area where you intend to live to a) look at the inventory and b) meet realtors to see if you click with anybody. I wish you the best as you prepare to find and buy your first home. And I hope that you find a professional and skilled realtor who is able to assist you in every facet of your search (while also knowing the area where you wish to look "like the back of their hands." And feel free to either email me at info@tommccarey.com or phone me at 773.848.9241 with any additional questions.

All the best.
1 vote Thank Flag Link Tue Jan 8, 2008
If you are looking in more than one area and you like both agents consider telling them that If I choose a home in your area I will purhase from you and if I choose a home in the other area I will use a different agent I met in the other area.
1 vote Thank Flag Link Mon Jan 7, 2008
Welcome to discomfort guys!
Interview each realtor and tell each that you are doing so. Choose one, and sign a buyers' broker agreement (if that is appropriate in your state) for 3 months. Choosing a buyers' broker is a very important decision. Choose your realtor like you'd choose a brain surgeon...its that important. Look for your buyers broker to be animated, interested, and full of questions about you and your family. They should become quite well versed in each family member and their needs, from sports, to work, to hobbies. They should love what they do!! They should know their neighborhoods cold. They should know home construction and good quality construction from top to bottom...they should be able to spot poor construction and upcoming maintenance issues BEFORE you negotiate a contract, and help you spot poor choices...ie...those homes that are most likely to be hard to re-sell or expensive for you to maintain !! Good Buyer's Brokers develop a sixth sense about problem homes. Its YOUR money and they need to be aggressive about protecting your best interests.
Further, an exceptional buyer's broker is busy, very busy....just like a good brain surgeon. Respect their time like you would your own. Professionals are worth wating for....Also...an old Pro realtor once taught me that you make your money when you BUY real estate, not when you sell it......Should you not understand that quite yet, make that one of the questions you ask your buyers broker.....if they can't answer it to your satisfaction....keep looking.
Good Luck!
1 vote Thank Flag Link Mon Jan 7, 2008
Jane, I would recommend that you are upfront with each one and tell them that since you are first time buyers you would like the opportunity to go out with each one to look at a few homes and then you will decide who you will use and only at that time will you sign a buyer's representation agreement.

If either one doesn't like this, then they are not looking after your best interest.

All the talk about experience, knowledge of market etc. is good, but the fact that you like your agent and feel that they will do their best for you is key. They have to be able to listen to you and cousel you appropriately especially you're going at this for the first time.

As you may know, 80% of the communication is body language so a face to face meeting is a must.

Another thing you may want to do is to google the name of each agent and you may find some interesting info about them.

Good luck to you and happy house hunting!!!
Web Reference: http://www.sumnerrealty.com
1 vote Thank Flag Link Mon Jan 7, 2008
I also agree that it's so nice to hear from buyers who care about the people they are doing business with. Realtors LOVE to find great clients like you. I wish I worked in your area!
You definitely want to start and end with only one agent. Perhaps you can decide by phone who you should work with. I think there are three big things that you should look at when making your decision:
#1. Years of experience in the business
20 is not necessarily better than 4 or 5 years, but 1 year or even 2 years is not enough unless they have been very successful and completed a large number of transactions. Experience really DOES matter in so many little ways.
#2. Specific market knowledge
Who has the most knowledge of the EXACT area where you are most interested.
#3. Personality
You have to really connect with this person and spend a lot of time with you.
Hopefully, they really "get" you -- and can zero in on exactly the right properties quickly.

Be blessed!
1 vote Thank Flag Link Mon Jan 7, 2008
Hi Jane,

This is a great question, and I'm so glad that there are people out there like you that have concerns for this!! As I’m sure you know, Realtors are all self-employed and we get compensated for our efforts only when we sell something. We do not get allowances, expenses paid or an hourly rate from the companies that we represent. It is strictly commission. I would appreciate it if a buyer had 2 potential Realtors; that they interview each and tell them both about the opposite, before you get in their car and use up all of their gas. Take some time to think it over after you have met with both and make a decision on who was the most knowledgeable and who you “clicked with” the most. Make sure you let the one you didn’t choose know and it would be helpful if you told them why. Once you have made this decision, it is time to start looking. Good luck to you!!
Web Reference: http://MelissaBMancini.com
1 vote Thank Flag Link Mon Jan 7, 2008
Hi Jane, congratulations on your plans! The thing is to be honest and open up front, I am always willing to take a buyer out once or twice at most on a short term agreement so we can get to know each other and see if it looks like we can communicate well. Knowing up front that I am competing with another buyers agent is no problem, I just don't want that to continue for more than about a week. Not everybody is a good fit, an agent should not be offended if you make another choice - and it may come as a surprise - but there are sometimes folks that I decide up front that I am not interested in committing to - one of the perks of working as an agent.
1 vote Thank Flag Link Mon Jan 7, 2008
The breach of etiquette is for the mortgage broker to pass your contact information on to anyone without your permission.

Real estate is a referral-based business, and typically, mortgage brokers and real estate agents refer business to each other on a good-will basis rather than on a pay-per-referral basis, but still – is it so hard for a mortgage broker to say, Voices Member, may I recommend a real estate agent who I believe will do a good job for you?
0 votes Thank Flag Link Fri Mar 5, 2010
We are first time buyers ad we went to visit 4 real estate agents and decide wich one we felt more confident, experience and zone knowing(schools, parks, security). After we talk and interview them we decide to go with Christina Ezzo-Gonzalez, and it work in 4 weeks they accepted our offer we love the house and she knew the area so well including schools and gang related problems we didn't lose our time in streets that were bad. So go and interview as many agents you want and you will know for sure wich is the one wo deserves you're bussiness.
0 votes Thank Flag Link Fri Mar 5, 2010
Go with one agent. You sound like a good person and I'm sure you would feel bad to have one do a lot of work and wind up out of the deal.

As far as the right point....just be up front right off the bat. Working with agents is like dating....the longer you string them along the harder it is to say goobye.
0 votes Thank Flag Link Thu Mar 13, 2008
I was having problems posting my answer before and one of the segments that did not get in the post that did go through was a slightly edited version of the following:

Let's replace "skeptical" with "unprofessional". Jane said she was "surprised to be contacted by 2 realtors." Did those lenders also give away Jane's other information without her permission. What if the lenders told the agents what Jane's income was and what she was approved for and Jane didn't choose those agent as her buyer's agent. Then later the agent turns out to be the listing agent for a home Jane is interested in buying. Jane's chosen buyer's agent tells her the home she wants is way over priced and to offer much less. How skewed will the negotiations be if the seller now knows how much Jane can afford?

This is actually highly unlikely. It's a courtesy to give the customer the agents information for them to call. I admit that I am not one to talk. Occasionally I will give a clients name and number as a referral without asking them first. I tell the person asking for the referral that I have NOT contacted my client and to please apologize for me giving out their number. Because Jane did like both agents, I'm sure they handled the situation professionally. I apologize for making a mountain out of a mole hill based on some wrong information I had to begin with and why I posted such a strange response.

Jane it sounds as if you are in good hands and your agent is lucky to have someone who respects them. Good luck,
Ruth
0 votes Thank Flag Link Sun Jan 13, 2008
Ruthless, Other/Just Looking in 60558
MVP'08
Jane,
you guys are like dream clients: clients with a heart.

I wish you the best home buying experience,
Dan Mengedoht
0 votes Thank Flag Link Mon Jan 7, 2008
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