I try to do a lot of things myself. Everything from buying a car on my own to filing my own taxes. You can ask my husband, the car expert, how well each of these has worked out for me. He’d tell you each time I’ve done one of these items without the help of an expert I’ve been able to do it but I find out I would have been a little better off if I’d asked for some assistance. Buying my first car is a great example. I thought “I can buy a car by myself. I don’t need a man or another ‘adult’ to help me. I can make sure I’m not getting ripped off on my own.” Fast forward about 48 hours post-purchase to me crying on a bed as my now husband tells me not only did they not do my loan through my bank as requested but I let them talk me into the clear coat, which apparently is the biggest load of BS they could have convinced me to buy. Yep, I bought that car and it’s clear coat all by myself through the wrong bank. Go me!
Once you’ve experienced this a few times you start to reconsider taking a go at some of these bigger taks with the help of an expert. Lately, I’ve heard a few people talk about tackling home buying without an agent, but buying a home without an agent could be setting yourself down a similar path to getting stuck purchasing the clear coat. I know, I know. I’m an agent telling you not to buy a home without a REALTOR®, but hear me, sometimes you just don’t know what’s worth the money.
A REALTOR® brings a lot of value to the purchase of your home. Real estate agents are here to guide you on the purchase, represent your best interests and make sure you feel confident about signing on the dotted line. For buyers, a real estate agent doesn’t cost you any money 99% of the time. When you purchase a home the seller agrees to pay their agent, who agrees to pay the buyer’s agent. It is written as part of their selling agreement and then written into the listing how much the buyer’s agent will be paid. The agent comes at not cost to the buyer unless their Buyer’s Brokerage Agreement states they will pay an additional fee or cover any percentage difference if the selling agent only covers up to a certain amount.
The biggest argument I hear for not using an agent: “I can talk the seller down on the sales price if he doesn’t have to pay the other agent.”
What most people don’t know though is you’re actually going to have to get the selling agent to agree to lower their commission, not the seller. Once you’ve seen a home listed on MLS, Zillow, or Realtor.com the seller has already agreed to pay a commission to the selling agent that is already earmarked to split with a buyer’s agent. If someone who is unrepresented wants to buy the home the selling agent gets to keep the commission that the seller has agreed to pay. So you’re really trying to appeal to the agent there, not the seller. And be honest, if someone said I’ll give $1,000 for you and a buddy to share OR I can just give you the $1,000 what would you pick?
Buying a home unrepresented is no easy feat either. There are many milestones between your offer and closing day, especially if you have a loan. Without an agent you are responsible for keeping track of the transaction, scheduling your own inspections, negotiating your own inspection items, making sure the seller completes the agreed upon items, checking in on your loan, making sure your title company has all the contact info and you get a clear title, making sure your termite inspection gets done, and a few other items on top of all the things you need to do as a homeowner (setting up insurance, utilities, your loan, moving, etc.) If you have a hiccup at any point in this journey you’re on your own to figure out to fix it, and you don’t know what you don’t know.
Buying a home without an agent also means you have to represent yourself. Yes, I know that seems obvious but do you really know what representing yourself means? It means no one is working on your behalf except you. Should you need any addendums written or negotiations handled you have to rely on the seller’s agent to do them for you and they are here to represent the seller. That means they might give you the runaround or answers you don’t really want to hear because they aren’t fighting for you. They are fighting for the seller to get the best outcome. You have to fight for yourself.
With an agent on your side you have someone who can speak the realty lingo, who knows the tips, tricks, and deadlines, and who can tell when an agent is trying to bluff you because they’ve seen it before. They fight to get you the best outcome for you! So before you buy solo ask yourself, “Is turning down this essentially free service really worth it?”