Should I Use the Listing Agent to Buy a House
It may seem easiest to go with the agent familiar with the home you like, but not having a buyer’s agent representing you could be a mistake.
First-time home buyers typically are not well versed in the complexities of agency disclosure, nor do they understand the concepts of a buyer’s agent and seller’s agent. All too often, the situation is the buyer meets an agent at an open house or emails them about a listing, and all they know is that he or she is an “agent.”
When you start getting more serious and want to inquire about a property, its price, condition or history, typically questions are directed to the seller’s agent — which presents an immediate conflict of interest.
So, what’s a buyer to do? Let’s help you understand the concept of agency before this happens.
A real estate agent’s loyalties and responsibilities change depending on the transaction. Here’s a quick rundown of the different roles an agent can play in any one transaction.
The listing agent or seller’s agent works for the seller and represents their interests in the sale of property. The seller hires the agent, typically in writing, to help market and sell their home.
The listing agent’s responsibility is to get the seller the highest amount of money in the shortest period of time possible. Their fiduciary goals, loyalty, and duties are with the seller at all times.
Purchasing a home can be emotionally draining, not to mention financially stressful. Many consumers seek independent counsel from a buyer’s agent.
A buyer’s agent works with them for as long as it takes to make a purchase. They teach the buyers the market, show them lots of homes, and eventually advise when it comes time to make an offer and negotiate with the seller and their agent. An invaluable resource, a buyer’s agent stands by the buyer’s side for the duration of their home search clear through closing.
A Dual Agent
Sometimes a buyer forgoes independent representation and chooses to work directly with the listing agent. This situation isn’t allowed in some states (here in Ohio this is currently permitted with disclosure) because of the conflict of interest. Where it is allowed, a dual agent represents both sides of the transaction at the same time.
In the case of a dual agent, it’s impossible for the agent to be completely loyal to either party. Both parties must agree to dual agency in writing, prior to writing a purchase offer.
Who pays for the agent?
In most circumstances, seller pay the real estate agent’s commission when the deal closes. The two agents then split the commission. In the case of the dual agent, the agent takes home the entire commission less any fees and splits owed to their broker.
Should I Use the Listing Agent to Buy a House?
Unless you are an experienced real estate investor or are willing to have your agent perform limited duties, it’s best to stick with independent real estate counsel. There’s no cost, and a good buyer’s agent will provide an invaluable amount of advice and support in what can end up being a very stressful period.
The home search can involve many twists and turns, so having a dedicated, loyal adviser along the way will help you make an informed decision on what is likely the largest purchase of your life.