Courses in this Department
Want to Invest in Real Estate?
How to Hire a Realtor
What's the Key to Locking in a Mortgage?
How to Improve Your Credit
Watch out for Mortgage Fraud
Need a Buyer-Broker?
Learn How to Best Insure Your Home and Save Money
Avoid Trouble on Your Kids
Downward Direction for Down Payments
How to Hire a Contractor
Save Money by Cancelling Your Private Mortgage Insurance ("PMI")
Crunch the Numbers and Drop Your Private Mortgage Insurance ("PMI") Payments
Who's Watching your Deposit Money?
Remodeling Value: Your Best Investments
More Than One Way to Pay for Remodeling
File Your Income Tax Returns Early and Save Money
Types of Loans Available for the Self-Employed
Top Five Homeowner Tax Saving Ideas
Should You Hire a Buyer Broker?
real estate industry is expanding its services, by taking advantage of the Internet,
national marketing and other consumer friendly options. One of the best of these
trends is the buyer-broker agreement. A growing number of buyer-brokerage firms
give homebuyers the option of having a professional representative on their side.
It means that homebuyers are no longer at the mercy of agents whose main obligation
is to get the highest possible price for the seller. It also means that the homebuyer
works exclusively with one agent during their home search.
should give you a disclosure form that describes the four types of representation:
buyer broker, seller's broker, dual agent (representing both buyer and seller)
or non-agent (representing neither). Remember that when it comes to negotiating
a sales price on a home, it's up to you to choose the arrangement. If you want
your broker to be accountable only to you, and not the seller, then your best
choice is a buyer broker contract. Under any other arrangement, your broker will
act as a go-between but cannot dicker or negotiate on your behalf.
majority of buyer agencies have a policy of "no cost to the buyer" which
allows the buyer broker's fee to come out of the normal sales commission paid
by the seller. In practice, the listing agent agrees to split the sales commission
with your broker, equal to a certain percentage of the final sales price. That
means the higher the price, the higher the commission. Listen to your broker's
advice but it's up to you to look out for your own interests. Make sure your broker
knows exactly how much you are willing to pay for the home.
traditional agent-buyer relationship, your agent cannot opinionate about a home's
defects or drawbacks. But if you do decide to hire a buyer broker, he or she will
be free to offer criticism and favorable advice to help you discriminate between
homes and get the lowest possible price. Some even represent buyers exclusively
and do no selling at all in their business. That's another clear advantage over
the seller's agent. A buyer agency will provide services most traditional brokerages
provide, including advice about property regulations and home financing alternatives.
You might be asked to sign an agreement to work exclusively with the
buyer broker during your home search. Whether you enter into an exclusive agreement
depends on how confident you are about the individual and the quality of services
he or she will provide. Whatever you decide, don't sign anything until you get
all your questions answered. Ask specifically how much the broker charges and
how he or she will get paid, by fee or commission.
If you look in the
Yellow pages, watch for the words 'buyer agency' in the agency's ad. The other
source for buyer brokers is through the professional buyer broker associations
whose membership is scattered across the country. Check the Internet.