Wednesday, July 1, 2020 / by Ken Couture
When it comes to buying or selling your home, hiring a professional to guide you through the process can save you money and headaches. It pays to have someone on your side who’s well-versed in the nuances of the market and can help ensure you get the best possible deal.
Of course, you have the option to purchase a home without an agent’s help or put your house on the market as for sale by owner. But if you’re not familiar with the buying or selling process, you may skip necessary steps, whether it’s failing to fix peeling paint or missing a deadline for due diligence when you’re under contract. You may also find that you’re not on an even playing field when it comes to negotiating the deal, which means you could ultimately pay more for the purchase or make less money in a sale.
Not every agent will be the right fit for you. Here’s what you need to know about searching for top real estate agents, interviewing potential candidates and understanding what services you can expect.
The process of finding the right real estate agent includes:
— Reaching out early in the process if you need more guidance.
— Asking friends, family and neighbors for recommendations.
— Checking out reviews online and writing down names from signs in your neighborhood.
— Interviewing multiple agents to find the right one.
— Discussing expectations for communication and time management.
— As the seller, talking about commission and additional cost expectations.
How Do You Find the Right Agent?
Knowing you need a real estate agent is a great start, but now you have to find the right one.
Here are the basics you’ll need to start your search, compare options and find the best real estate professional to fit your needs:
— Getting started.
— Talking to a lender.
— Agent, Realtor or broker?
— Where to look.
— Questions to ask an agent.
— Getting references.
— Reviewing the contract.
— Preparing to buy or sell.
— How much will an agent cost you?
The first step to finding the right real estate agent is determining the type of help you’ll need. A real estate agent can serve as your guide from start to finish during the home purchase or sale process, so don’t be afraid to start reaching out to potential agents even when you’re still not quite ready to put your house on the market or haven’t figured out which lender is best for you.
For first-time homebuyers, a real estate agent can often help you assess different mortgage programs. You can use her as a knowledgeable sounding board to talk through your financial concerns and needs before you apply for preapproval for a loan. Your agent can then help narrow the search for best-fit homes within your budget.
For sellers, bringing an agent into the fold sooner rather than later eliminates the possibility of unnecessary steps in prepping a house for the market. During initial interviews, your agent will likely tour your house and tell you which updates, repairs and renovations will help you get top dollar for the property.
Talking to a Lender
Whether you talk to a lender before or after you’ve found the right real estate agent will be based on your comfort level.
If you are unsure how to best navigate the process of applying for mortgage preapproval and determining your budget, an experienced real estate agent can help you find the loan products that will keep homeownership affordable for you — not to mention the lenders and mortgage brokers that have a strong track record. “That person is also going to have unbelievable relationships that have been built and fostered for years,” says Dawn McKenna, a real estate broker with Coldwell Banker Realty who works throughout the Chicago metro area as well as in Naples, Florida.
If you’ve had a mortgage before and feel confident with a specific lender and the programs offered, preapproval before you even speak with a real estate agent can help the process move faster.
Either way, you want to be aware of your financial situation before you talk to a real estate agent. Have the documents you’ll need to apply for a loan on hand, including bank statements, pay stubs and a credit report that will help determine your budget.
Agent, Realtor or Broker?
A real estate agent by any other name is still an agent, whether you more often hear Realtor, broker or licensed real estate salesperson. The differences are in affiliation or certification level.
Here’s the basic breakdown:
— Real estate agent. An agent is anyone who holds a license to practice real estate issued by his or her state.
— Licensed real estate salesperson. This requires the same certification as a real estate agent. The “licensed salesperson” title is more common in some parts of the U.S. — most notably the New York City area.
— Realtor. Only members of the National Association of Realtors can call themselves a Realtor. As of May 2020, there were more than 1.3 million members of the trade association, so you’ll likely come across more than a few Realtors in your search.
— Associate broker. An associate broker has undergone a certain amount of extra education and hours of experience, and may have had to pass an additional exam.
— Broker. To achieve broker status, a real estate agent has completed more hours of experience, additional education and in many cases demonstrated leadership abilities among other agents. Brokers also typically earn additional certification to be able to take on the title. Some states only allow one broker per real estate firm, and that person is typically the head of the company.
Whether you’re buying or selling, you may want to find a real estate agent who works exclusively with clients on that side of the transaction — an exclusive buyer’s agent, for example. Other times, you may find that an agent works on a team, which allows individuals to specialize in either sales or purchases while still remaining united to help give you full service. A team may also employ unlicensed pros to help with marketing, showing the house and more.
In nontraditional real estate brokerage companies like Redfin, you’re still dealing with licensed agents in the transaction, though there will likely be nonagents working with you as well to handle tasks like scheduling, marketing and more.
Where to Look
Begin your search by asking friends, family members or neighbors if they can recommend any agents. Even if you get a glowing review from a friend, talk with a few different agents before you decide on one.
You can also look online or around your neighborhood. Here are a few places to find real estate agents:
— Local magazines and area “top 10” or “best of” lists.
— Local or regional real estate association websites.
— For sale signs in your neighborhood.
— Neighbors who recently moved in or sold their home.
If you use a nontraditional brokerage like Redfin, you’ll be put in touch with someone once you’ve contacted the company, but you can still set up interviews to ensure the person you’ll primarily be working with is a good fit.
Call to set up an interview with each of your potential agents, and know that the vetting process can start even before you’ve sat down. If an agent’s social media accounts or descriptions of homes in listings don’t necessarily make you feel like it’s a good fit, keep that in mind and see if the interview changes your mind. “Relatability is a big deal right now, and (buyers) want the house and the agent to be relatable,” he says.
Questions to Ask an Agent
Go into that initial meeting with your potential real estate agent armed with questions that will help you gauge the person’s experience, knowledge of your area and whether she’ll be a good fit for you in terms of personality and communication.
Whether you’re buying or selling, you want to feel confident that your agent is going to advocate for you and work in your best interests. Stein says she’s come across clients who aren’t willing to share necessary personal and financial information with their agents because they fear the details will be used against them: “They’re not going to tell (the agent) they’re getting a divorce.”
For a successful deal, Stein stresses you have to be willing to trust your real estate agent. If you are hesitant about doing so, maybe that agent isn’t the right fit for you.
Here are some of questions you should ask a potential agent:
— How long have you been a real estate agent? Especially if you’re buying or selling for the first time, you want to know the level of experience and how much you can rely on your agent, Realtor or broker to guide you.
— What’s your average number of clients at one time? You want to know you’ll be able to contact your agent when needed, and you don’t want to be passed over for other clients. If the agent has a long client list, ask how they balance the load and if there are other team members who assist.
— What area do you cover? An agent’s experience is only helpful if he’s familiar with the area you’re buying or selling in. If your agent isn’t familiar with the neighborhoods you’re considering, find someone who is.
— What type of communication do you prefer? You want to know how best to communicate with your agent for speedy responses. Many agents take advantage of texting to be able to verify details quickly and easily, but if you prefer phone calls or emails, find an agent who can accommodate.
You’ll want to ask more questions that pertain to your unique situation and the agent’s experience. See more advice on essential questions to ask a real estate agent.
Follow up the initial meeting by checking references and reviews on sites like Zillow or realtor.com. Don’t be afraid to dig deep to explore the agent’s experience, credentials and history in terms of recent sales, news coverage and potential problems that might rule them out for you.
Positive reviews are valuable, but look out for patterns mentioned in negative or mediocre reviews. Some negative reviews don’t really reflect on the agent but the client’s own issues, but similar problems across multiple client experiences can reveal some red flags. These red flags could include:
— Poor communication skills.
— Lack of availability.
— Disinterest once a deal is under contract.
— Frequent disagreements with other agents.
Online reviews shouldn’t be the only information you get, however. “Just because someone gets good reviews doesn’t necessarily mean they’re going to be the best person for you,” he says.
An agent will provide you with a list of satisfied clients who have worked with them in the past. Follow up on those references by calling, asking about the experience and the smoothness of the transaction. Don’t be afraid to ask about what might have gone wrong, or what the person wishes could have been different.
Reviewing the Contract
If you’re selling a home, you’ll be asked to sign a contract with your listing agent that establishes the total commission you’ll pay upon sale of the property, the length of time the agent has to sell the property before the contract runs out and other responsibilities of both you and the agent.
Be sure the contract you sign includes all the specifics you discussed with your agent, like a specific marketing plan for the home. This will help keep both you and your agent from disagreeing on expectations later. “As time goes on, memories fade and what I may think you said and you may think you said can be different,” he says.
As a homebuyer, a buyer’s agent agreement is less common but happens occasionally to guarantee that you work with one agent rather than many. While a buyer agent’s salary is paid by the seller, this agreement helps to guarantee a deal (and pay) will happen after the work to find potential homes, lead tours and help write an offer.
Whether you’re a buyer or seller, if you have signed a contract with your agent and no longer wish to work with him or her, discuss with your agent whether formally ending the contract is possible. In the case of selling a home, you may have to wait until the time period specified in the contract is over to sell your house with a new agent — otherwise the original agent would still have a right to a fair split of the commission.
If you have no formal agreement with your real estate agent, you have no obligation if you choose to move on with another. When possible, of course, avoid burning bridges and make a call or send an email notifying any agent you’ve been working with that you’ve chosen to work with someone else. This will help you avoid continued calls and texts, and it keeps real estate agents from feeling like they’ve been ghosted.
Preparing to Buy or Sell
With an agent selected, it’s time to move forward with the process of buying, selling or both. Agents will begin scouring listings for houses that fit a buyer’s needs, and they will instruct sellers on the work needed to make a property ready for sale. Work to prepare a home for sale can include:
— Painting walls.
— Exterior landscaping.
— Moderate renovations for outdated rooms.
— Decluttering interior spaces.
— Deep-clean of the entire house.
— Staging the home.
With the right repairs completed, a serious conversation about what your home is truly worth will help you avoid overpricing the property, which can leave it sitting on the market for too long. “Everyone always thinks their house is probably worth more than it is,” he says. You need an agent who’s willing to have that honest conversation from the start to help ensure a successful sale.
As you’re touring homes to purchase, your agent will also guide the way for putting together an offer when you’ve found the right one, including price, conditions and other expectations. The agent will then contact the seller’s agent to submit the offer and be in touch with you as negotiations take place. You make all final decisions regarding price and whether to accept a counteroffer, counter that or walk away.
Once you go under contract, your agent will help you navigate the steps leading to the closing date, including scheduling a home inspection, working with the title insurance company and answering questions from the lender to ensure you get to the closing table.
A key part of your success is your agent’s ability to work with other agents and brokers in the area. If your agent has a reputation for being difficult, expect it to show during the tour and negotiation process. Ask the agent about his ability to work with other agents on the opposite side of a deal — if he talks about winning or fighting with the other side rather than respect and professionalism to reach a successful deal, you might want to note a potential problem. “It’s very important to cooperate with the whole broker community,” he says. You don’t want to lose out on a property because your agent has a hard time working with others.
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