Insider Secret #6:
How to Hire your Area's Top Real Estate 'Buyer's Agent' to represent you ... for FREE!
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We'll talk about two things here:
a.) Requirements of state law on buyer vs. seller representation.
b.) Who is really paying the commission when you have a buyer agent?
In the same way that you would NOT want to use the same attorney as your opponent in a court case, you would NOT trust that the seller's realtor would have your best interests at heart, either. Make sense?
This distinction is VITAL for you to understand. Many people don't understand this option when buying a home. We've even found people, who have bought homes three and four times, and still don't understand this!
Why? Because, the fact that a buyer agent IS an option, which is supported by a state law, is NOT explained to buyers very well, if at all.
ALL realtors, who put their signs in a yard of a home for sale (the listing agent) represent the seller and the seller alone. Period. The buyer has NO representation whatsoever. The realtor's job is to get the seller the best deal, the best negotiating, the best terms, the best price -- and the best of everything.
If you don't have a buyer's agent, representing you and your interests, the seller's realtor is, in reality, your adversary!
As if that weren't bad enough -- when you go around looking for a house with another realtor who is, ostensibly, helping you ... they also work for the seller! By state law, in almost all states, they AUTOMATICALLY represent the seller, unless YOU decide to change that with them. You better read that again because it's that important.
But, now that you know better, you can avoid this 'catch 22,' with a simple legal document that changes a realtor's obligation and relationship with you.
This simple, legal document turns the 'seller-broker' relationship to a 'buyer-broker' relationship. And that means you have a realtor working for YOU now! And that's what you want.
A buyer broker relationship means they represent you, and they have your best interests at heart. They have a legal, fiduciary obligation, under the law, to get you the best deal, the best price, the best terms, the best financing, the best of everything possible - including the best disclosure of all items within that property.
However, many buyers aren't aware of this, and when they are made fully aware, they almost always want to elect for this type of representation. Who wouldn't? But they naturally wonder what the cost would be to have their own advocate and advisor on their side?
Well, here's the incredible part about it ... it costs you nothing extra.
Nothing, nada, zilch.
As a matter of fact, when a house is listed for sale, the seller signs a listing agreement with the listing agent. And in that listing agreement, it says that all realtors in the transaction are to be compensated by the seller, whether they represent the seller or the buyer.
So, as you can see, you get your very OWN advocate ... and the Seller is required by their very own listing agreement to pay the bill!
Let's just use the number of a 6% total commission for an example. The seller has agreed to pay 6% commission to the listing company. The listing company puts that property up for sale on the MLS network. Then, they offer 3% commission (half, of the total 6%) to any other real estate agent in the marketplace, who has a buyer interested in buying that property.
The realtor wants to get the house sold, so they'll do this all day long. They want to bring in as many agents and buyers as possible to get the house sold. That's how the real estate industry works.
The averages show that 90% of all homes are sold in this commission-splitting arrangement -- with two different Realtors involved in the transaction.
Only 10 percent of all homes are actually sold by the listing agent. That means 90% of homes are sold by another agent. And, quite often, that other agent is with an entirely different company. So that being the case, the other agent (working with the buyer) is going get a 3% commission for working with you to help you buy a home.
But here's the big BUT ... unless you denote that this 3% commission is to be paid on your behalf, giving you buyer representation (as opposed to being for the seller's behalf), then you're most likely not going to get the best deal for yourself.
Now, there's a sticky wicket in this whole situation. What makes a good buyer's agent? Some companies out there advertise that buyers representation is all they do. They do not work with any sellers, and they claim that's in a buyer's best interest.
So, this is supposed to make them a better choice for buyers to work with. I think this is just a cheap marketing ploy. As a matter of fact, I know it is, and here's why ...
Having been in this business for over 20 years, I don't believe anyone can only represent one side of a transaction all the time throughout their career - and then turn around and say they understand both sides of the transaction, and that they can negotiate very well for you. That's preposterous.
You have to also sell houses for sellers, in the same time frame and in the same market to understand what's going through a seller's mind, so you can best represent your buyer.
You have to understand all the conditions of the market and all the seller's concerns at that time. There could be market changes on a weekly or monthly basis.
For example, if I had ten listings for sale in the marketplace and many of my sellers were complaining about a drop off in the amount of buyer traffic that's coming through to view their homes for sale ... I would find out why.
And, if I learned that a company down the road had reduced their employee base and cut back on hiring, which resulted in fewer home purchases ... then I would know how/why these sellers are more motivated right now!
And if I had a buyer client at that time, and I was acting as their buyer agent, I could disclose that information to my buyer, so they could take advantage of that situation in the marketplace.
If I was not an agent, who worked with sellers at all, I would never have been privy to that 'insider information' which would be a huge benefit to my other buyer client. So I really feel you have to work both sides of the transaction to properly represent the best interests of either side.
As you can see, you are allowed, by law, to have your very own buyer's agent to represent you and your best interests when you're ready to buy your home. And, at no extra cost. Far, far too many buyers are NEVER made aware of this.
Consequently, many buyers in real estate transactions do not get the best deal. Because no one is really on their side!
If you're interested in buying a home in N. Virginia and you would like to find out more about which 'Insider strategies' can be customized to save you tens of thousands on your own future home purchase, and also about having me represent you personally, at NO additional cost, you can contact my office for a free, over-the-phone consultation, covering your own needs.
You can also learn much more in-depth information, about saving money as a Northern VA homebuyer by registering for my upcoming FREE, LIVE Online Webinar.
Remember, the seller pays my commissions - you don't pay me one, red cent!
You just get the BEST advice and guidance in all of N. Virginia.
To conclude ...
As you can see, by just knowing that you have a legal right to your own buyer's agent, you are miles ahead of many homebuyers, who have bought numerous homes, without knowing this one, little secret.
Perhaps you read some of the testimonials when you requested this e-course? Then you know that many savvy, real estate investors and even professional real estate agents and mortgage lenders use me as their buyer agent -- because of my deep experience and knowledge of the N. VA market and my application of these and many other advanced "insider techniques' for saving my clients so much money.
Be sure to check your email often, because in a few days, you'll get your seventh 'inside real estate' secret.
In it, I'll be talking about how to read the broad real estate market to profit from hidden trends and save thousands on your home purchase!
Find the Best Deals and Save $25,000-$50,000 on Your Northern Virginia Home Purchase. Get My FREE Homebuyer Savings CD to find out How to use the "Insider Techniques" to get Huge Home Purchase Savings.
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Until next time,
Thierry Roche SFR, CDPE
Host of Talk Radio's,
'Inside Real Estate'