Why Home Buyers Need Their Own Agent
Buying a home is a complex process. There is a wealth of information at your fingertips to help you get started, including homes for sale, market statistics, and how-to advice. When you add in the guidance and perspective of a seasoned professional, you have the best chance for a smooth, relatively stress-free transaction.
To make the best possible home buying decisions, you should have the best guidance and information. An experienced real estate agent can assist you through the search process, give you details on comparable recently sold homes, help you craft an offer and negotiate successfully, and advise you through the inspection, repair, and appraisal processes. Your agent can help you find the best value, neighborhood, and quality for your budget and requirements.
To simplify how commissions are routed, sales commissions are paid out of the seller's proceeds, according to the terms of the listing agreement and/or the sales contract. Thus, the buyers' agent commission is paid by the sellers, as a portion of their listing commission. You likely will not have to pay anything out of pocket for the services of a buyers' agent (see your Buyers Representation Agreement for stipulations).
If you are at all tempted to go directly to the listing agent for a home that interests you, keep in mind that the listing agent has a fiduciary duty to the seller. This means they are obligated to act in their clients' best interests. If you try to use the listing agent of a home to help you write an offer, they can only represent you if they act as 'dual agent' and get written permission from the sellers to do so - and in that case, the agent can't advise either side on price or negotiation strategy. If they help you write the offer without acting as a dual agent, you have NO representation as a buyer, and no one to advise you or look after your interests.
How It Works
Here's how it works. All agents showing open houses or builder homes have a registration log. When you enter, you sign your name and the name of your agent. If your agent is with you, he or she will do the signing. This reinforces your agent's responsibilities in representing your interest in that particular home.
What if you go to an open house or builder model home tour and never mention that you have an agent? If you decide to buy the home that you're looking at, the seller's agent has the right to refuse to pay your agent's commission. Without the seller's agent co-pay, your agent can't represent you. You will be subject to the seller's terms, which are in the seller's interests, not yours.
If you're shopping for homes without your agent, or using multiple agents to find a home, your agent will eventually hear about it because agents network to get more homes sold. Your lack of commitment to your agent could have consequences. If you choose to shop for homes without being represented, be aware that you are in competition with other buyers who are. The sellers that you'll be negotiating with also have their own representation, so you could miss out on a jewel of a home by simply not having an agent looking out for you.
Good agents build their businesses through repeat clients and referrals. They are highly motivated to do the best job possible for home buyers. They understand that buyers eventually become sellers and "move up" buyers. It's about building a relationship of trust. Take advantage of that. Don't go house-hunting without your agent. Let your agent do the best job possible for you.