A friend of mine called me a few weeks ago. “Bro” he said, “I want to buy a house, any advice?“. So naturally, I do what I do for all of my clients. I send them my buyers guide and then ask them if they’re using an agent. I ask this for a couple of reasons.
- I work with agents all around the country. I know what “right” looks like, and I want my friends and family to be taken care of by real professionals.
- I get paid to make referrals. This one is pretty self serving…..it’s actually completely self serving. But if you’re going to make a list, then you should have more than one item on said list.
He told me that he is going to “go ahead and work with the homeowner directly and that the home owners attorney was going to put together the paperwork“. While I get that you may feel like there’s an advantage to doing this to possibly save money and not having to pay “fees”.
But answer this question before you go down this road. 🤔
Who does the attorney work for, and what is the nature of their relationship with the seller (their client) and you, the buyer of the seller’s home? How are you protected? Which disclosures should you be looking for? Which disclosures should you ask for? What is actually standard practice in your area for inspection deadlines? These are all questions that you must get answered, and questions that any agent worth their salt can answer in the first ten minutes of meeting you.
“Yeah, but I can save money on the real estate fee if I do it myself!” This sounds nice, but no…no you can’t. If you read my blog about How Real Estate Agents Get Paid then you know that the SELLER pays all fees. So the support of someone who has (unlike the seller’s attorney) actually assisted people in helping buying and selling homes, and it wont cost you anything more than a referral of a friend or family member. Also, keep in mind that as an agent, I call A LOT of homeowners who sell by owner. Nearly 100% of them have already built the 3% (Cost of a buyer’s agent) into their sale’s price. It’s a free resource to you, you might as well take it. Also, if you tell them that you aren’t using an agent in order to “save the fees”, I assure you that they will fire back that they didn’t build that into the cost of their home (Yes, Sellers Lie).
“Yeah, but if the SELLER is paying the buyer’s agent, then doesn’t the buyer’s agent work for the seller?” Yeah, that’s not the way that works. One of the first things an agent should do is explain to you the fiduciary (Legal) obligation they have to you. For example, I only work in the capacity of single agent. Which means, while some agents serve the integrity of the transaction, and will sacrifice their clients happiness or satisfaction (Transactional Broker), I have no issue waging total war in order in terms of negotiation and process in order to make my clients happy (Single Agent). Because at the end of the day, it’s not the one transaction from one sale that will support my family. It’s your referral to your friends and family, and in order to get that, you’ve got to feel like I did everything I could to make you happy. So no, as a single agent…..I only care that you get your house, because I work for you.
At the end of the day, buying a home is a wonderful thing. But you don’t want to go into it under prepared. While it looks like it is an easy process, I assure you that there’s lot’s of land mines between making an offer, and getting the keys at the closing table, and if you’re using a real estate agent who has been trained to look out for them, and experienced first hand setting some off, you will have a much easier, less stressful journey to home ownership. I’m not implying that all attorneys are Saul Goodman of Better Call Saul and Breaking Bad. There’s some really great ones out there who do great work, but like Real Estate Agents, there’s plenty who are shit bags and you shouldn’t trust with anything! Especially one of the largest financial decision of your life! Find someone who you trust, who works for you, who you can talk to you about the process intelligently, and help you avoid disaster. If you do that, it won’t cost you a thing…..except a referral!