patrick.net

Do your homework, if you are in California get this book:

http://www.amazon.com/House-California-Ralph-Warner-Attorney/dp/1413309232

BEWARE: If you are buying a house that is listed by an agent they will try to get you to sign over the buyers agents commission to them!!!

I'm in Michigan. I heard that you have to be a licensed agent to actually get the commission so the only thing you can really do is negotiate the price down 3%.

woggs1 says

Do your homework, if you are in California get this book:
http://www.amazon.com/House-California-Ralph-Warner-Attorney/dp/1413309232
BEWARE: If you are buying a house that is listed by an agent they will try to get you to sign over the buyers agents commission to them!!!

You are assuming that OP will not have buyers agent.

EBounding says

I’m in Michigan. I heard that you have to be a licensed agent to actually get the commission so the only thing you can really do is negotiate the price down 3%.

You don't want to get a commission anyway, because that would be taxable income. What you want is a DISCOUNT or REBATE.

Sometimes a sleazy realtor (is that redundant?) will try to claim that "I have to 1099 you the rebate" to try and scare you with having to pay taxes, which some people are so afraid of that they will get all emotional and not realize that the realtor is just playing a trick on them.

Moral of the story: Ask for a rebate at closing, do not ask to "split the commission" or some such. And don't believe what the realtor says.

I had a Realtor (Buyers Agent) in San Antonio, Texas who told me you can not make an offer on a house without your own buyers agent. He then said "why would you not want an agent?" "It's free".

Lots of bad info above.

We buy our homes with no buyers agent. It has been easier than buying with a buyers agent for us. Don't concern yourself with the commission. It is none of the buyer's business, except for considering it in your offer. Offer 3% less than you normally would. The listing agent and the escrow company do all the paperwork. You have to read the same paperwork no matter who presents it to you, and read it; carefully.

I'm not an apologist for realtors, really, I'm not, but they can be worthwhile, you just never know when. Lotsa help, I know.

I don't know if there are true buyer's agents in Michigan, but they can be a little different since they get paid a fee instead of a commission - whether you buy or not. But even in the traditional scenario, in my experience, one thing many realtors I know are good at is their horse sense of the commodity price of real estate. I'm a price skeptic - they're too damn high - but the half dozen or so realtors I regularly work with always (these day) estimate 5-10% below what I would. That's got some value.

In addition, one thing you be nearly certain of in any FSBO is that the price is too damn high. Often as not, it's FSBO because potential agents told the seller what the seller didn't want to hear.

you dont need a Buyers agent. However, you do need a reputable/trusted RE Attorney. The Lawyer will be the most important part of the entire transaction and buffer you need on your end..

Use the "no buyer agent" bargaining chip as the last card to negotiate the price down. When I bought a short sale in MA, I told the seller's agent/Coldwell Banjer that if they want to sell the property, wave the 2.5% of what would have been the buyer's agent commission. At first they declined, but eventually that's exactly what happened.. Or alternatively you can negotiate a percentage point on the total commission on your offer( ie. if the total commission is 5%- negotiate a 3.5% RE commission and get a rebate at closing or deduct off price..). Only submit an offer after you have discussed/reviewed with your lawyer. Also, if the home has had several sales since 2000, buy Personal title insurance for peace of mind. If the house has only had 1 owner, you may not need it...Check with your attorney..

Dont leave any money on the table.. And good luck...

If you're buying without an agent, and especially if you're unfamiliar with the process, make sure you have a good real estate lawyer working for you (not just handling the closing).

RE transactions are contracts, and most of it is regulated and boilerplate, but there are opportunities for customization and aberrant variables, which a lawyer or experienced RE investor will recognize. They'll review the language, verify that it's correct for your state, let you know if there are any unusual insertions, answer any questions you have about your obligations and contingencies, etc. They have no vested interest in the completion or abandonment of the sale, unlike an agent. They will not have an opinion on your offer or the market, at least not professionally.

They'll probably cost a few hundred or maybe a thousand dollars, but it's cheap insurance.

jvolstad says

I had a Realtor (Buyers Agent) in San Antonio, Texas who told me you can not make an offer on a house without your own buyers agent. He then said “why would you not want an agent?” “It’s free”.

They're such lying scumbags.

Thanks for the tips all.

I was looking for a house 2 years ago with a buyer's agent. I called off the search since I couldn't afford the houses at the time. This Realtor was supposed to know the area very well, but I ended up directing her to many of the houses. She knew little about the houses other than what was on the sheet and didn't have much to say about how much lower the price should be. Plus most of the houses she picked for us we already chose ourselves online. She was nice, but I just didn't really see the value in what she was doing.

quesera says

If you’re buying without an agent, and especially if you’re unfamiliar with the process, make sure you have a good real estate lawyer working for you (not just handling the closing).

I did plan on finding a good attorney before I start looking and make the official offer. Would it hurt though to send a Letter of Intent to the seller before getting an official offer drafted? I just wouldn't want to go through getting an offer agreement drafted and have the seller just chuck it. I also would like to send LOI to several other properties in case our first choice falls through. Is this a good strategy?

"whatever" ios absolutely correct. The title company/escrow won't let shit happen. IMHO you don't even need a listing agent. Speak with a RE atty if you need to - but the forms are standard and the info is on the interwebs.

Call a title company and ask to speak with someone regarding a potential purchase and they'll give you tons o information. At least in UT & NV that's how it goes. Realtors only have to disclose what they know, so much of the time they don't disclose prior defects because they don't ask. There are absolutely no guarantees - but Realtors don't sway the deal either way.

Be a hard-ass, don't let 'em push you around. If there's a seller's agent, offer lower and be prepared to waltz away. They'll come running 'cause it's a buyer's market out there. Educate yourself and you'll do fine.

Realtors are obsolete. The only thing they'll walk you thru is their bank account.

I know I'm about to get roasted but I just became a buyer's agent in the Las Vegas area. I did so after applying to this website a few years ago. REASON: Because I felt like no one in the business was truly acting like an "agent" for the consumer. No one was offering the information needed to make an informed decision on the biggest purchase of their lives. I know many have a distain for REALTORs but I can assure you that there is value in having a buyer's agent. Just yesterday I actually talked someone out of buying a home and moving into a rental based on my education attained from information provided on sites such as this one. They were an elderly couple moving here from PA. They wanted to buy "right away" because they were selling their home in PA and wanted to assure they had a place to land. I talked to them about the benefits of renting. They explained how they wanted to buy but appreciated my candor. In the end they are going to rent for the next year so they can get here, understand the area, and have more time to search. I will act as their buyer's agent. I will deliver the fiduciary duties associated with being anyone's agent. In the end they thanked me and explained how EVERY other agent they talked to just tried to get them to buy. I explained that they have unscrupulous people in every career field. It's our job as consumers to find people we can trust will serve us best. That's no different in the real estate world, mechanic world, plumbing world, or medical world. How many people have said, "Do you know a good doctor?" We ask that because we're trying to find someone we can trust. It's no different than with a REALTOR. Could we buy a home without an agent. Yes. Can we miss something along the way that opens us to liability later, Yes. Does a REALTOR have more access to homes on the market. Yes because our search engines make it easy for us. Being that I've purchased a home both with an agent and without I can say that I would go with a buyer's agent, but one that I felt had my best interests in mind. That's the most important part. You should interview the REALTOR/agent. See what their motivation to sell is. Mine, will always be to act in the best interest of my client. Although I'll make less money now, I'm hopeful I can create a strong referral system and be in business for a long time. If not, I'll be back on here dogging the industry! Ha!

anthony.ard says

I know I’m about to get roasted but I just became a buyer’s agent in the Las Vegas area. I did so after applying to this website a few years ago.

I almost became a part-time agent. I balked when I realized that the only way to participate in the rigged game was to pay NAR. I refuse to give money to an organization that I want to see burned to the ground.

anthony.ard says

I know many have a distain for REALTORs but I can assure you that there is value in having a buyer’s agent.

You capitalized their name...

anthony.ard says

How many people have said, “Do you know a good doctor?” We ask that because we’re trying to find someone we can trust. It’s no different than with a REALTOR.

....and you compared them to doctors. You're a full-fledged realtard.

anthony.ard says

Does a REALTOR have more access to homes on the market. Yes because our search engines make it easy for us.

Your "search engine" is nothing more than a simple database. realtors have more access to homes on the market because your industry is run by a cartel. By intentionally keeping information from customers, the cartel can extort them. This is not a justification for using a realtor, it's an indictment against the criminal enterprise which all realtors belong to. It's an admission that their only purpose is to extort and fuck over hard-working people.

You're right, this was an invitation to be roasted. Take a step back and think about why it is that people "need" realtors. Is it really because of their expertise, or perhaps there's an intentional systemic corruption going on, something which puts clients at a steep disadvantage. The game is rigged, and agents are allowed (by design) to use asymetric information to take advantage of people. The association itself is constantly putting out fraudulent market reports on top of being a criminal cartel. There is no defense for such an organization.

By the way, I am a real estate attorney, not a used house salesman.

I disagree about title companies. I used to own one. They do some of the paperwork very well. But not all of it. They don't care about anything that doesn't affect title. For example: disclosures about defects in electrical, plumbing, problems with zoning, or even water bills and _____ ... If it doesn't affect title, it's not their problem.

I would like to say attorneys are important to this, but it is extremely difficult to find one who is really helpful, at least at the residential level. I would be, but there aren't many others. It's not a very easy sell. I would charge $3000.00. Assuming this is a fair price, and assuming that people would pay it, I would be living very comfortably.

Fact is, it's too low, and there is still no market for it. Cut it in half, and there's still no market for it. Bump it to $2000 and 100 clients per year. Seems like a nice business - two assitants at $50K and I make $100K - and assume I could get that (that's about what I made in title). What are your expectations? No zoning, construction, title or value issues? I'm pretty sure I wouldn't be able to get malpractice covergage unless I specifically excluded those.

Note: I would exclude a few states who require lawyers to be involved. But, talk to a newbie lawyer who, desperate for business, represented someone for, say $750 or $1250, and see if they ever wanted to do it again. I would say that without 5-10 years experience in real estate transactions - nearly every day - they can't possibly provide value, except as an additional person to sue.

Also note: you pay for what you get. Your appraisal is probably ONLY certified to your lender. Your construction issues are a matter of known or should have known defects. Title is separately insured. As for zoning, First American insured that for a few years, but as far as I know, no longer does, having been presented a serious rectal cavity-load of claims.

A few of the commenters here evidence what I'm talking about - they're looking for additional parties to sue. Malpractice carriers know this and they exclude certain types of representation from coverage.

So, back to "you get what you pay for." With the exception of a few states that mandate or customarily dictate attorney involvement (the Carolinas, Connecticut, Illinois), very few people will ever have an attorney representing them in a residential deal. Furthermore, realtors and mortgage originators will probably discourage their customers/clients (not the same thing) from getting representation.

I'm all for choices and I don't believe the "required-attorney" states are any better than anybody else. My point is that real estate transactions are exceedingly complex, and the risks are always evolving. For example, the simple "should I buy now? question: I don't know. I do know this, however: put 20% down now and there's an exceedingly good chance you will never see that money again. Almost certainly, you will not see half of that any time soon if you have to resell - and that's if prices hold steady. This is why the realtors and mortgage originators love me. This is why this is such desirable business for lawyers and everybody is looking to get us involved.

I've bought and sold houses without agents. I don't know if I would do it for a first home, but it's not so complicated. Stipulate to the selling agent what your terms are and have them write up the offer, then take it home and scrutinize every detail, make sure you thoroughly understand it before signing. You can make changes to the document and initial the changes or have the agent re-write it. You may want to have a real estate lawyer review the offer and all related documents before presenting it to the seller.