I've heard it is a bad idea to go through the listing agent vs. a buying agent - why?

Asked by New Buyer, Northern, CA Wed Apr 23, 2008

My husband and I jumped on a home that finally met our criteria in today's "buyer's market". It's the first affordable home we've found, but it is bank owned. We haven't been working with a realtor so we called the listing agent. After showing the house and seeing our obvious excitement over the property, they asked us to bid immediately as they had two other offers. I'm nervous about rushing into something so quickly, but don't want to miss the opportunity to purchase a home that finally meets our needs for the price. This realtor specializes in foreclosures and appear to be very trustworthy, but I'm nervous about using the bank's agent as my own. I then read its a bad idea to go through the listing agent versus a buying agent and wanted to know why? We're first time home buyers and we haven't received any guidance from this agent as far as what we should bid etc.
Thanks!

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9
Heidi Golff, Agent, Ventura, CA
Wed Apr 23, 2008
BEST ANSWER
This will depend upon the integrity of the agent and his/her broker. In a normal buyer/seller relationship where the seller is mandated to disclose all property defects and there are personalities involved, things can easily get out of control if the agent is out for herself and not equally protecting all parties. There can be a conflict of interest; however, that being said, an ethical agent with an ethical broker can protect everyone. It is not the best of all worlds, but it can be done. With bank-owned property, the banks are normally choosey about who represents them. In most cases, the agent has passed the test for reliability, education, and responsibility. Go for it! The biggest mistake first time buyers make is listening to the "arm chair" experts.
0 votes
Elaine Biers…, Agent, Rocklin, CA
Wed Apr 23, 2008
Your "nervousness" is warranted. The agent has broken Rule No. 1 of salesperson/agent trustworthiness. No agent or salesperson should ever apply pressure tactics to persuade a potential buyer into a contract of any kind. That "buy/sign right now or loose" is Never in the best interest of anyone - except the agent/salesperson.

It is in your best interest to have your own agent that is solely looking out for your best interest. If you are ready buyers, and have shopped diligently for the best loan product/lender available with which to purchase a home, it makes a great deal of sense to apply the same diligence to your real estate professional representative.

How do you find that great real estate professional that will put You first? You can ask friends, neighbors, relatives in the area for a referral to agents that have done a good job for them, or you can call any of the real estate brokerages in your area for a referral. Talk to the broker manager and describe your real estate interests and needs, and the type of person and personality that you would be most comfortable working with. Ask the manager for a referral within his or her office of someone that best fits your descriptions and ask to have that person call you for an interview. Do that with two or three companies and interview them all. You will be introduced to experienced and knowledgeable agents, and have an opportunity to decide whom you are most personally comfortable. Now you will know with reasonable certainly that your best interests will be foremost, and you have a team leader that you can trust and enjoy working with throughout and beyond the buying process.

I hope this information is helpful to you. If you would like to speak to me personally to discuss your question further, or if you have any other questions, please do not hesitate to give me a call, or drop me an email. I am happy to assist you.

Sincerely,

Elaine Bierstock
http://www.LiveInGraniteBay.com
Elaine@LiveInGraniteBay.com
(916) 791-0535
0 votes
Joshua Stern, Agent, Salt Lake City, UT
Wed Apr 23, 2008
I don't know that it is a BAD idea, but when it comes to something as important as buying a home, you owe it to yourself to interview more than one agent for the job. That includes interviewing the banks agent on how they will represent you. I have a friend who represents banks, she runs a team. She won't write the offers on her bank owned properties for a buyer, however she has her team members represent the buyers instead. The team members aren't attached to whether or not you buy the bank home you originally inquired about. They would just as happily find any other home that is a good fit for you.
It really boils down to how educated the agent is and how they plan on personally representing you. If you feel good about the agent who is representing the bank, it may help you get into the property. But you should always interview more than one agent for the job, after all, it's your money.
0 votes
Mark Raponi, , Longwood, FL
Wed Apr 23, 2008
You should have your own representation, especially since you are a first time home buyer. Having your own agent negotiate for you will usually get you a better deal. A good Buyer agent will also be helpful in communicating and assisting with your mortgage approval/underwriting process as well as review of appraisal and inspections to make sure you are getting a good deal. Buying a home can be stressful and having a good Buyer agent will ensure a smooth transaction.
0 votes
John Peterson, , 95003
Wed Apr 23, 2008
It's always best to have your own representation. The listing agent has a fudiciary responsibility to the seller, in this case the bank. Since you're being brought into a bidding situation, you will be at the mercy of the listing agent. Deals are out there, having your own agent will allow you to see what and where they are. You may do better!
0 votes
Daniel Garfo…, , 15208
Wed Apr 23, 2008
World collide for an Agent who is trying to get their seller the highest price and at the same time representing a buyer on the same property who is trying to pay the least. Serving two masters is one thing serving two with opposite goals is another.
0 votes
Samantha Lin…, , Idaho
Wed Apr 23, 2008
I would alway suggest to get your own representation. This is simply because you can't serve two masters. Eventhough some states offer a vehicle in which to do this...and sometimes it does work...having someone on your side..all on your side is usuallly the best.
0 votes
Amy Herring, , Tallahassee, FL
Wed Apr 23, 2008
Great question, and a very popular one among buyers. Each State varies concerning laws on client representation....for instance in Florida we cannot practice dual agency. I have found that buyers feel more confident in having their own agent, although in Florida "we" are transaction brokers and work together in bringing buyers and sellers together for a win-win deal for both parties. Although agents feel they are strong negotiators, it is really up to the seller (individial or bank) to decide what they are willing to accept. Other areas do practice Dual Agency, and are bound by fiduciary duties and a strong code of ethics. The agent for the bank should be presenting all offers equally and without prejudice for their final decision. The only think I can think of is what we call a "variable commission" meaning that the agent agrees to a lesser commission if she brings the buyer vs another agent bringing the buyer. The bank will look more favorable at an offer that saves them money on their net, if all else is equal (price,terms).
Web Reference:  http://www.amyherring.com
0 votes
Glinda Willi…, Agent, Tulsa, OK
Wed Apr 23, 2008
When using an agent who has the property listed you are entering into a Dual relationship where the agent is representing both the seller and the buyer. On one hand, the agent that knows the property best is the listing agent, On the other hand; the agent must remain neutral when it come to negotiating. The facts are presented and both parties are guided without revealing any private information about the other client. When the level of trust has been developed in a agent client relationship, this usually is not a problem. Most agents are trustworthy and have a fudiciary reponsiblity to each of their clients.
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