Some advantages of using a buyer’s agent:
Recommend Other Members of Your Team:
Because real estate is a local industry, agents see the same people working again and again at different parts of the process. They often know home inspectors, appraisers, and even lenders to recommend to you.
Advise You Through the Unexpected:
Home buying is a long and complicated process, and the unexpected is one of the only guarantees. If an unexpected home inspection turns negotiations sour, your agent can act as a buffer between you and the seller.
Real Estate Agents Have a Style:
Whether it’s a neighborhood, type of home or type of seller, all real estate agents have a specialty. Make sure that your agent has a style that meshes with you and your needs, and that they are able to bring their expertise to bear on your home sale.
Some potential disadvantages of using a buyer’s agent:
Focusing on Yourself
As many stories are out there of hero-agents that fulfill their client’s dreams, there are horror stories of agents who have led buyers astray. Agents sometimes have several clients to juggle, and unfortunately, some homebuyers get pushed to the back. A homebuyer representing themselves, however, only has themselves to look out for. If you are a detail-oriented person who loves complicated legal documents and is ready to turn home buying into a full-time job, maybe you are ready to strike out on your own.
While most see the agent’s commission being paid by the seller as a huge bonus, it makes others uncomfortable. Some view both agents as working for the seller, and not as representatives for each. Besides just relying on yourself to complete the sale, some buyers can hire a real estate lawyer to act as the third party in these cases. Additionally, sellers will hire what’s called a dual broker, a person who works both sides of the transaction and collects the full 6% commission. Dual brokers have many critics and view their position as a conflict of interest.
Lower Sale Price?
Other buyers may think about going without an agent because they believe that without the buyer’s agent, the purchase price of the home will reduce by 3%. This is and is not true. With any home sale, the offer is up to the buyer and the final price is negotiable. In this way, a buyer representing themselves can negotiate the sale price to reduce it by whatever the agent’s commission would have been. This is more likely to happen when buying from a family or individual, rather than a bank or other institution. In most cases, both agent’s commissions will be built into the sale price, and the buyer will be paying for an agent whether they use one or not.
Using an Agent vs. Going Alone
In most instances, a reputable, professional agent provides an invaluable service to the homebuyer. It’s important to find an agent that you trust, one that listens to your priorities and has your best interests at heart. For the first-time homebuyer, an agent is essential, and it isn’t recommended you enter the home buying process the first time without one. But, if you are buying your third or fourth house, feel that you understand the process, the market, and know what you’re looking for, then now might be the time to purchase without an agent, and see if you can get yourself a better deal.
Back to: Build Your Real Estate Team
The Home Buying Process Demystified
The home buying process is wrought with potential pitfalls and challenges, but when done right can be relatively painless. As champions of homebuying, we’ve created this step-by-step guide to help you through the process.
Below you’ll find an overview of the home buying timeline as well as the major components of the home buying process with links to the various steps, tools, and information to educate and empower your home search, discovery and purchase.
How Long Does it Take to Buy a Home?
Your timeline may vary, but the following is a good guideline
- Preparing to Buy a Home: 3-4 weeks
- Initial Search for Ideas: 1-4 weeks
- Building a Team: 1 week (overlap initial search)
- Pre-Approval of Mortgage: 12-48 hours
- The Home Search: 4-8 weeks (depending on criteria)
- Contract-to-Close: 14-60 days
So, on average a homebuyer will spend 30-60 days shopping and 14-60 days from contract to close. For some folks, the process can be extremely quick taking as little as 30 days total, while for others, the shopping period alone can last several months.
How Much Home Can I Afford?
The first step in the home buying process is understanding if you have the resources to buy a home. This includes knowing how much home you can afford, what type of down payment and monthly mortgage payment to budget for, as well as what type of loan program you’ll use to finance your new property.
Buying a home is a complicated process that requires a good deal of research. In the course of it, there will be a number of professionals and specialists involved. Once you’ve done your homework and assessed your resources, you’ll need to assemble your team.
Assembling Your Team
After you have a good understanding of your own wants, needs, and goals, it’s time to assemble your team and begin the home search! Who should be on your team? Who you’ll need to find on your own may vary, but the key team members could be: Real estate agent (could be a RealtorTM but not all agents are), home appraiser, title company, home inspector, insurance agent and mortgage lender.
When selecting the members of this team, take the same amount of care you would in choosing a home, because these people will be working for you to help you do just that. Trust & communication are key considerations in working with your team.
Sorting Out Your Finances
With the selection of a mortgage lender comes the application for mortgage pre-approval, a task that requires collecting the necessary financial paperwork to help obtain the approval. Once obtained the clock begins ticking because many pre-approval offers have a limited life-span before they expire.
Your Home Search
While you juggle the paperwork and timelines implicit to the process, remember that your team works for you. Now your search for (and discovering) your new home begins. Research, save, view and repeat. Remember Homes.com has all the tools you need to find and keep track of your favorite properties and home shortlist.
You’ve got a mortgage pre-approval in hand and have found a property you can afford to purchase and see yourself living in. Time for a purchase offer to a listing agent or seller!
Once you receive an acceptance offer, the due-diligence period starts a timeline of checks and tasks for final mortgage approvals, appraisals, inspections, and other requirements that would be stated in the terms of the contract.
Assessment, Conditions & Negotiation
Many consider this to be the most difficult part of the home buying process as it includes, but isn’t limited to, inspection, obtaining the final loan, purchasing insurance, and the potentially arduous negotiation. In this part of the process, every member of your team will be utilized, and the more homework you have done in building your team, the smoother this part will go. Those who haven’t conducted their proper due diligence could potentially see the purchase fall apart at this point.
Closing the Deal!
A successful closing requires all of the team players to come together at the same time, with the same agenda, on the same date, with numbers and figures that match. From the start of the home search to the home inspection and closing the deal, the entire home buying process can take most homeowners about three months.