Finding the "perfect deal" in real estate considers many different aspects. I mean, just trying to determine market trends and neighborhood stabilization rates alone can be quite a headache for a first time homebuyer who doesn't have an agent. In fact, how would you know what information to research or where to even look to find the information??? It can become quite confusing and disheartening!
This was my complete thought process when I received a phone call from a young couple who'd been pre-approved for a loan (for their first home) and decided that they would "save money" by only working with listing agents on properties that piqued their interest. For some, this may appear to be a completely rational strategy in purchasing one of the biggest investments that you'll ever make in your entire life. I mean....you save money, right? Especially since the Seller no longer has to pay a commission to a Buyer's Agent, right??? WRONG!!!
In fact, NOTHING could be farther from the truth!!!
The Seller pays a pre-determined commission to the Listing Agent. At closing, the Listing Agent pays a pre-determined commission to the Selling (Buyer's) Agent. In Georgia, real estate commissions ARE NOT part of the Purchase & Sale Contract between the Seller and the Buyer. The Commission is addressed in the contract between the Seller and the Listing Agent and again through a contract between the Listing Agent and Selling Agent.
Oftentimes, the Listing Agent represents the Seller. However, there are some instances in which a dual agency has been created. Meaning, the Listing Agent will represent both the Seller and the Buyer. In most States, the Buyer and Seller MUST both acknowledge and agree, in writing, that they are amenable to the Agent representing both parties in the same transaction.
Having your own representation protects YOU!!! There are many upfront costs involved in purchasing a home. One of your agent's #1 objective is to help ensure that you're not spending money in vain. For instance, a good agent will prepare a detailed market analysis of the home in which you're interested and advise you of a good offer amount based upon this analysis. There's no other horror quite like spending $450+ on a home appraisal for a property that was clearly overpriced from the beginning!!! A bad appraisal ( or maybe even a good appraisal on a bad contract) can quite often kill a deal. Additionally, if this information was obtained outside of the appraisal contingency period, the Buyer could also lose their earnest money as well.
It's all about opting to take advantage of a plethora of resources that can help guide you through the process. A process that can sometimes become convoluted and quite confusing for someone who doesn't have a professional working only for them. There are many things that we can do alone....purchasing a new home should not be one of them!
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