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Buyers Need an Agent, Too

As a new prospective buyer, you've researched properties on-line and now you are ready to start going to see some of the houses that you've identified as possibilities. You want to check out neighborhoods and also get a feel for the size, texture, layout and reality of some actual homes. So, off you go to some open houses. You walk into the first one and are greeted by a real estate agent who is thrilled to see you and acts like you are his new best friend. You tour the house and fall in love with it. Now what do you do?

The first thing you need to realize is that in almost every case, the real estate agent represents the home seller, particularly if that agent's name is on the sign outside. The agent should tell you whom he represents, but don't count on it. He is there to sell the house and he will help you write an offer if you're so inclined. But his duty is to the seller, not to you. Anything you tell him about yourself, your likes and dislikes about the house, your financial situation and what you think the house is worth, he is duty bound to pass on to the seller. He has no obligation to you to keep any of that information confidential, unless he is your agent and you have a signed buyer agency agreement with him.

The seller's agent is permitted to write a contract offer for you by asking you sufficient questions to help him fill in the blanks on the forms. But as you go through the contract forms amounting to at least 19 pages, who is going to explain what all the contract clauses mean, what your options may be or what the consequences are to you? If you proceed without anyone representing you, what will you do if confronted with a counter offer? Or, if you arrive at a ratified contract, what will you do if your home inspection reveals issues with the property?

You should be aware that you can have your own agent to represent your interests, to advise you as you go through the process, and to negotiate on your behalf. The seller and his agent have negotiated a listing agreement in which they have agreed that the commission the seller will pay for the sale of the house will be split between the listing agent and the agent representing the buyer. You ought to have your own agent who will be paid by the seller, but be loyal to you and represent your interests. Otherwise, you are at a clear disadvantage in a process that will involve what is likely to be the largest financial transaction you have ever had.

So, as you walk through an open house, ask questions, get educated about the features of the house, ask about any problems the agent is aware of, find out about the neighborhood, but don't give away information that could disadvantage you later in a negotiation. If you don't have buyer's agent, consider finding one to help you through the process before you make any serious mistakes.