If I am considering purchasing real estate, what are the pros and cons of selecting one agent to work with exclusively? Why not “play the field” and contact several (or even lots of) agents and have all of them scouting properties and deals for me? Why not just look around on my own? After all, I know what I’m looking for, right?
Let’s cut to the perceived “cons” of signing a Buyer Brokerage Agreement first, since they may seem obvious to most potential buyers:
- “If I can strike a deal working with the listing agent only, won’t I be able to save money since the seller won’t be paying a selling commission?”
- “If I have several non-exclusive agents out looking at deals for me, won’t I get more good properties to consider? And only the agent who brings the best property to me will be paid; that’s fair, right?”
- “I would be promising to ONLY look at properties with my exclusive agent. What if he/she isn’t available when I want to look?”
Will I really save money by dealing directly with the seller’s listing agent? Overwhelmingly, no. That listing agent realizes that he/she will earn every penny of both the listing AND selling commission since they will be solely responsible for seeing the entire deal through to closing. And I have absolutely no power or standing whatsoever to renegotiate the commission agreement already signed between the listing broker and the seller since I am not a party to that agreement. It’s none of my business and some listing agents may even tell me so. Unrepresented buyers like me, in addition to needing much more “hand-holding” than I ever believe I actually will, are also placing ourselves in a position of “spilling our guts” to the listing agent, only to find out later that the listing agent MUST report any pertinent information to his/her CLIENT, the seller. What I say can and will be used against me during the negotiations and at the closing table. Ouch!
Will I get more or better opportunities if I have several agents out scouting properties for me? Not likely, because those agents will be spending their time and energy with their CLIENTS, those buyers who have actually hired them. If the agents have spare time, they may think of me, but only as an afterthought. Why would they waste time with me if they have CLIENTS to work with? And those CLIENTS haven’t paid a dime upfront and will only owe a commission IF they select a property not listed by a licensed brokerage or the seller won’t pay the commission in the case of a FSBO (and today 99% of FSBO’s are delighted to pay a buyer’s agent’s commission just to get an offer).
Won’t it slow me down to have to wait for my agent to meet me at properties I’m interested in? Probably not, since my agent is going to be able to eliminate a lot of properties I wouldn’t be interested in anyway AND the fact that I’m a CLIENT would get me priority time with my agent. I’m first in line for my agent’s time, not last.
So, are there any other “pros” to interviewing buyer’s agents and selecting a single agent to work with exclusively? Yes. Consider these:
- Good buyer’s agents KNOW LOTS OF NEIGHBORHOODS AND AREAS I’m not familiar with. Once an agent gets an idea of what puts a sparkle in a buyer’s eye, the agent can and will suggest alternative neighborhoods and properties I would have missed. They also know properties not yet on the market which may fit my needs and will approach those owners on my behalf!
- Buyer’s agents know how to work with For Sale By Owners (FSBO), too, and negotiate to have their commission paid by the seller if I select that property to buy.
- Buyer’s agents PREVIEW properties on the inside before taking me there. This is such a time and stress saver! I don’t have to waste time and gas money going to properties that aren’t what I am interested in. Plus, buyer’s agents can suggest I see some properties that I may have passed on because I didn’t care for the curb appeal or the interior photos online.
- Buyer’s agents VERIFY that what the seller and listing agent are advertising and telling me is true. And buyer’s agents have a goo-gaggle of information sources I don’t.
- Buyer’s agents can and will alert me to potentially EXPENSIVE PROPERTY CONDITION ISSUES. They notice that the support column holding up the second story is leaning, that the retaining wall is bulging and that the garage may not fit my SUV, among a million other things. They know these things because of their previous experiences and by swapping “war stories” with other buyer’s agents.
- Buyer’s agents will do a DETAILED COMPARISON of the property I’m considering and what’s sold recently nearby. After all, I don’t want to overpay. Even if I become infatuated with the beauty (in my eyes) of a property, that doesn’t mean the bank appraiser will have the same opinion. Unless I’m paying cash (hey, wait a minute, ESPECIALLY if I’m paying cash), the appraiser’s opinion is necessary.
- Buyer’s agents are really good at finding out what the seller’s “HOT BUTTONS” are and can advise me on certain offer terms which will make my offer more attractive to the seller. If the seller absolutely wants to move really soon, my buyer’s agent will help me parlay that information into a lower offer price in exchange for making the move convenient for the seller, for example.
- Buyer’s agents love to be able to present offers to sellers and their listing agents because they can “HUMANIZE” me (and my family) to the seller. Buyer’s agents are ADVOCATES for their clients.
- Buyer’s agents have the responsibility to NEGOTIATE in my best interests, over and above their own interests.
- Buyer’s agents know the TERMS AND CONDITIONS of the Purchase and Sale Agreement backwards and forwards. Shockingly, there are over a dozen potential hurdles the seller and I will have to navigate to get to the closing table. I want someone on my side reminding me of deadlines and handling all paperwork in a timely manner.
- Buyer’s agents know REPUTABLE mortgage lenders and work WITH them rather than stepping on their toes.
- Buyer’s agents can and will help me avoid a buying mistake by advising me about FUTURE SALABILITY ISSUES I may face when I want to make my next move.
Trying to find the best property for myself and my family and navigating all the hurdles to closing without the enormous resources, help and advice of someone working FOR me seems foolhardy to me. And it doesn’t cost me a dime.
Tags: ann bone, atlanta, atlanta real estate, Better Homes and Gardens Real Estate Metro Brokers, buyer brokerage agreement, buyer's agent, Buyers, georgia, Metro Brokers, Real Estate, real estate agent, Realtor, Tips