Question Details

Rich, Home Buyer in Atlanta, GA

In what ways can a buyer's agent help a buyer, if ultimately they just want to...

Asked by Rich, Atlanta, GA Sun Sep 2, 2007

...close the sale for as much money as possible and in turn, split a larger commission?

And, are there things that a buyer just can't perform on their own, and only an agent can do?

Thanks.

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Answers

15
Rich,
I am sorry you have such a jaded view of a buyers agent. Do you really think we want to increase your costs instead of save you money? We are there to help you. I have advised clients to walk away from deals where the seller won't make the money right. The buyers could have a would have paid more had they been on their own. It our job to make sure they don't make a purchase that they will be upside down on when they try to sell. Keep in mind most of our business is off of referrals and repeat business. We want to do the best job so you will referr us to your friends and family and we want your repeat business when you need to sell. I would wager an agent who would run their business in the manner you described won't be in business long.
Web Reference: http://carriecrowell.com
5 votes Thank Flag Link Sun Sep 2, 2007
Hi Rich,
We refuse to double-end a deal (represent both seller and buyer). Obviously if you were right about all Realtors wanting to close for as much $$ as possible, that alone would prove you incorrect. I personally take pride in getting my clients the best possible deal. We recently had buyers who've really wanted a particular house and wanted to offer more than the asking price when there were no other offers yet, and we advised them against it. In that same case, after inspections, we negotiated a $40,000 credit from the sellers. This house was a "flip" and looked spectacular, and, it was only on the market for a couple of days when we got into contract. In other words, it was a situation where you may not expect to see negotiation. Just like Carrie said, we are in business for the long term, not for any one particular deal. We want to do such a remarkable job for you that you refer us to your friends and family. And, as I mentioned, I get personal satisfaction by getting a lower price for my buyers (and I higher price for my sellers). I have never come across a buyer or a seller who wasn't at least somewhat emotionally involved in the house, and seemingly unable to simply negotiate unemotionally. When tempers flare, a good Realtor keeps everything in perspective, and gets the client what they want, whether that be getting the house or extracting themselves from the contract. As far as what we do that you can't do on your own...we and our international brokerage protect you from legal issues you wouldn't even think of, among other things.
2 votes Thank Flag Link Sun Sep 2, 2007
Hey Rich great question,
I see by your other questions you are getting ready to buy.

Irina & Paul could have not said it any better.

However I think they left out one thing.

The buyers agent does all of what they said ,over and over again for every house that you are interested in.
Add up the hours.
A buyers agent spends a lot of time driving a client around to see the homes they requested. If the deal falls through...
We do it again. For the same pay.
Twice as much work, three times as much work.
Its a tough job, but someones got to do it.
2 votes Thank Flag Link Sun Sep 2, 2007
Mr.P, Other/Just Looking in Arizona
MVP'08
Hi Rich,
You can most likely do many of the things that a buyer broker can do for you, just not efficiently, nor as well. There is a steep learning curve. A competent buyer's agent will negotiate the best deal possible for you. I've heard the "higher the sale price the higher the commission" argument before, but it's ludicrous that a respected Realtor would risk damage to reputation and future business over a few extra bucks. Do the math. No good agent will talk you up $10,000 so he/she can pocket an extra $250-$300. That's not a good way to stay in business very long. If you are unrepresented, you will be negotiating against the seller's hired gun. Wouldn't you rather have a professional who negotiates for a living representing you as well? The agent will have superior access and knowledge about values to assist in the negotiations. A buyer's agent will arrange inspections and negotiate the findings as well. Do you know the legal requirements and timelines in the purchase agreement? Do you know what is customarily a buyer expense vs seller expense? Do you know what requirements to hold the seller to? In a nutshell, you can certainly purchase property without representation. Many times, though, it amounts to not seeing the forest for the trees. People often fixate on the perceived additional cost, when a competent buyer's agent will actually save you thousands of dollars and hours of your life. The agent might even talk you out of purchasing the property because he/she sees negatives that you do not that might affect your future investment. A bad agent might cost you in the manner you described, but a good buyer's agent is priceless.
2 votes Thank Flag Link Sun Sep 2, 2007
Hi Rich,

A buyer's agent's goal is to represent and protect their client - the buyer. The commissions are paid by the seller via the listing agent. If you have no representation, the listing agent gets both sides of the commission and their responsibility is to protect the seller, NOT the buyer.

The buyer's agent will help with the following:
- help you understand the current trends in the market (are prices stable? are they going out? how many months of inventory is there in the area? and much more)
- help you understand the area (schools, community, historical perspective)
- help ensure that the contract is written to protect you the buyer. There are many ways to write the contract for purchase (review your options, contingencies, time frames, protect your deposit and much more)
- NEGOTIATE on YOUR behalf!
- provide you with the comparables to help you come up with the offer price. A good buyer's agent will not tell you how much to offer, but will give you information to help guide you.
- a buyer's agent should oversee every step of the escrow process.
- a buyer's agent will ensure that all the necessary steps are followed - walk throughs, termite inspections, sewer line inspections.

Ultimately, a buyer's agent will share their expertise with you and guide you through the process of buying a house and will ensure that you have a great experience.

Good luck with the purchase of your home!
2 votes Thank Flag Link Sun Sep 2, 2007
Hi Rich,
I agree w/ most of the posts here - I've just never seen this done by a Realtor I've known or heard about.

One other piece of info that I believe was not mentioned below is the built-in check-and-balance system: The appraiser chosen by your lender reviews the deal, including the purchase price. After you (and hopefully your Realtor ) negotiate a price with the seller, your lender will send in an appraiser. If anyone involved had artificially inflated the purchase price, the appraiser would almost certainly come back with a report that says, in so many words, "it's not worth what you've agreed to pay for it." Then you're back to the negotiating table to agree with the seller on a new, lower price, or agree to let the deal go and find another home. But be careful here: if prices in your hometown are generally falling, appraisers & buyers & sellers can have a hard time nailing down the "right" price.

Ultimately, you hire a Realtor for the market knowledge and market experience they have, just like when you hire an attorney or an accountant or choose a doctor. Ask questions about their experiences and trust your gut - you'll choose the right representative for you, even if that person is you.
1 vote Thank Flag Link Mon Sep 3, 2007
If you choose to buy a home without a buyers agent, then the sellers agent ultimately represents you. It's their license on the line and they are repsonsible for both sides of the transaction. (And they should earn the full commission.)

I don't beieve a buyers agent ultimately holds out for a higher price in anticipation of a higher commision. Let's say there is a difference in price of $20,000. At a hypothetical 3% commission, thats only $600 to the buyers agent side. By the time they split that with their broker and pay adminsitrative costs, that only neta a couple of hundred dollars BEFORE taxes. Choose a Realtor....not just an agent. They will keep your best interest in mind.
Web Reference: http://www.cindihagley.com
1 vote Thank Flag Link Sun Sep 2, 2007
The Hagley G…, Real Estate Pro in Pleasanton, CA
MVP'08
Contact
The idea that an buyer agent wants you to pay more money for a property so he/she can earn a larger commission is so highly improbable, that is really isn't worth the time or energy to think about it. It really is that unlikely.

Great buyer agents take pride in negotiating the best contract possible for their client. Agents who dedicated to their profession know their markets, the comps, and stand ready to support their buyers offer with comps. They are willing to explain why a seller should take an offer and have trained and practiced to develop persuasive skills.

Meet several agents and find the buyer agent who is both dedicated to representing your interests and has the skill and ability to deliver.

You may be able to locate a property and close the transaction and take title to the new property. What you wont' know, when all is said and done, is what the outcome might have been with a trained and dedicated agent working on your behalf. I would not attempt to buy or sell outside my market without an agent.
0 votes Thank Flag Link Mon Sep 3, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
Rich,
Not all Realtors are the same. By interviewing and choosing a top producing Realtor you will find their skills will save you time and money. If you had a important legal,medical or tax transaction would you do it yourself. The internet and a good book store can give you the information but what is your time and money i.e self worth valued at? I would go with a full time professional every time, DIY?? I can change my oil but for $14.99 at the quick is it worth my time?
Web Reference: http://www.teamrenton.com
0 votes Thank Flag Link Mon Sep 3, 2007
I am a buyers agent and a sellers agent and sometimes get the buyer through open houses or past referrals that want to buy my listing! When in fact I represtent both buyer and seller I am working both clients for their best interest, I have done so many things personally for my clients, letting them know I am more than willing to be there for any questions or concerns on anything Real estate including personal. They have closed as much as 10 years ago and still call me for anything, this is what has made me an asset to all of my past clients. In Silicon Valley where I sell homes, some of my clients work 10-14 hour days, I know I can be an asset to their lives. My past clients are some of my best friends.
Web Reference: http://www.realeasy4u.com
0 votes Thank Flag Link Mon Sep 3, 2007
I agree with most of the great comments below. As buyer's agents we have a fiduciary duty to work on behalf of the buyer's best interests regarding negotiating price and terms.

Just me, and I am a bit of a competitive person...the negotiation piece of a buyer transaction is really an exciting component of the transaction as a whole. I really enjoy it and want to get the best deal possible for my clients! That to me is worth way more than a few extra bucks!
Web Reference: http://www.sacreblog.com
0 votes Thank Flag Link Mon Sep 3, 2007
Erin Stumpf, Real Estate Pro in Sacramento, CA
MVP'08
Contact
Rich, these are all great post. Just remember that as a Buyer "Client", your agent owes you full fudiciary duties. Your REALTOR will try to negotiate the best deal for you AND protect your interest. Statistics say most buyer's lose money when they negotiate for themselves as with a FSBO. I have clients who have many horror stories to tell when they purchased without a professional. We know the laws, ethics etc. to keep you out of trouble and happy. Remember, we work FREE for Buyer's. Don't know why anyone would want to undertake such a serious legal experience without Free expert assistance. Anyway, it's not the commission we care about (the Seller pays that by the way), it's having a true honest relationship for life with a buyer and his family and friends. Without good referrals, we have NO business. We are here for you to answer all your questions. In closing Rich, get Buyer representation, you will be glad you did in the end.
Good Luck!!
0 votes Thank Flag Link Sun Sep 2, 2007
Rich, You are not able to view homes listed by a real estate company without a licensed professional. All other things, you are able to do, if you have at least some training. Unreprisented buyers do this all the time. You will see some of their requests for assistance on this site after they've made an error or run into a problem.

A Realtor® (not just a licensed professional) is required to follow the Code of Ethics. In addition there are State and Federal regulations in place to protect the consumer. If you believe your real estate professional is just trying to get you to pay as much money as possible I suggest speaking with the agents supervising Broker or filing a complaint with the local Real Estate Board.

A sample Buyers Agency Agreement is on the link below. Take some time to review those items the buyer and the agent are saying they will do. There will be a similar form in your area.

A Buyers Agency Agreement can be for one home, one day, one week, ,,,etc. Sign only what you feel comfortable doing. Just be careful, there is something called Procuring Cause where the buyer can be held responsible for payment after they purchase. Working only with one person is the best way to avoid a Procuring Cause issue.
0 votes Thank Flag Link Sun Sep 2, 2007
Buyer representation is a service that is available to people that want it or need it. Its not for everyone. My personal rewards have come from people that expressed extreme gratitude for my service.
0 votes Thank Flag Link Sun Sep 2, 2007
Hey Rich great question,
I see by your other questions you are getting ready to buy.

Irina & Paul could have not said it any better.

However I think they left out one thing.

The buyers agent does all of what they said over and over again for every house that you are interested in.
Add up the hours. A buyers agent spends a lot of time driving a client around to see the homes they requested. If the deal falls through...We do it again. For the same pay.
Twice as much work, three times as much work.
It a tough job
0 votes Thank Flag Link Sun Sep 2, 2007
Mr.P, Other/Just Looking in Arizona
MVP'08
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