Buyers agents are almost always paid by the sellers if the home is pre-owned or by the builder if it is new construction. Even with For Sale by Owners, in most cases the seller will pay the commission of the buyers agent. Talk to different agents on how they handle the few cases where a seller will not pay the commission.
As far as how to find and decide on the right buyers agent, some recommend looking at the names on signs, but these are listing agents. They can and usually do also represent buyers, however remember that if they show you their own listings where is their real allegiance. They then have to be kind of neutral. They still have to give you all the material facts of the property, but are they really giving you full representation, and are they working to negotiate the best deal for you. More of the responsibility lies with you at this point.
Many wil say personal references which can be a good way, however remember that different people like or don't like agents for certain reasons. Some buyers like to do almost all the work. They look online then drive by the homes, and if they like what they see they then call the agent to show them the home. To a person like this, what they need is just someone who can open the doors, and to negotiate the contract for them.
Other buyers like to be truly represented by the agent. What I mean is that the buyer may still look online, but also want an agent to find them homes that meet their criteria. The buyers agent will then work to find you the homes that are the best buys. For example, when I look at homes on the Multiple Listing Service (MLS) I generally find 10% - 15% of the homes have a great price, maybe another 10% have a good price, then the rest are overpriced or in some cases are overimproved resulting in a high price. What I mean by this is if you look in a subdivision or community, you may see most of the homes have the same basic features. One homeowner may have added on, put in multiple upgrades and has made the home much nicer than the other homes in the area. This home has been overimproved for the area, and even though the seller wants a lot more money the neighborhood will not bear the price being asked.
In my opinion the best way to find the right agent for you is to talk to several of them. Call them on the phone. Do they answer their phone? If not do they call you back in a reasonable amount of time? If you email them do they respond in a timely fashion? If they do not, how good will they be to work with?
Next the questions to ask:
1. How do you get paid?
2. What happens if the seller does not pay a commission?
3. How long have you been a Realtor?
4. How successful were you in 2007?
5. How many homes did you sell in 2007?
6. Do you work as an individual or in a team? (Hint: Teams may say they sold 100 homes, but have ten agents. This might be the same as an individual agent selling 10 homes in a year.)
7. If you email properties, what properties do you send me? (Hint: some Realtors just put you on an automatic MLS email program where you are emailed every home. This requires no work from the Realtor. Other Realtors go through all new listings daily that meet your criteria and send you the ones that are priced right, and that best meet your needs. Do you really want to receive 100 properties including ones that are priced tens of thousands of dollars too high>)
8. Do you preview the homes that seem best? (This is especially important for a buyer that is not local)
9. What kind of training do you have? Look for Realtors that go to more than just the basic training classes.
10. Do you have any designations? Look for the letters after their name, such as CRS, e-PRO, and many others. These require many hours of extensive training and testing.
11. Do you work as a Realtor full-time or part-time? (Many of the less successful agents, especially in a slow market end up taking another job, and are only available to you part-time. Do you want an agent that cannot stay in the business full-time and can only show you homes on certain days.)
There are many other questions you can ask, but you should have a good idea with these. And remember, if you start working with someone and are not happy with them, you can drop them and work with someone else. If a Realtor asks you to sign a Buyer Brokerage Agreement, which is fine in that it builds committment for both parties, make sure that you can fire that Realtor at no cost to you, if they do not do the job the promised or even if you just do not get along. You want a knowlegeable Realtor that you feel comfortable working with.