When first-time home buyers start thinking about buying a property, they will usually start with an online search for homes that are in their price range and include the characteristics they are looking for.
They might visit an open house or fill out an online form inquiring about a specific property and have an email exchange with the person who represents the property.
These communications are usually benign and don’t pose any kind of conflict of interest or cause for concern.
However, as the process of searching for their perfect home gets more involved, they may come to a time when they are ready to make an offer contingent on answers to a few questions.
It is at this point that asking the seller’s agent any further questions becomes a conflict of interest and the homebuyer needs to take a step back and find the support and guidance they need to realize their dream of home ownership.
This whole process can be very complex with a lot of contingencies and rules to understand. It is important to be aware of the role that an agent can play within the boundaries of a single transaction.
The buyer’s agent
If you are looking to buy a home, you are likely looking for the easiest and most stress-free method possible. Sometimes the reason for a move is very positive and exciting, while other times it is a difficult or unplanned event.
In either case, it is essential that the house-hunting process be as smooth and simple as possible. A buyer’s agent works hard for their clients to find only the homes that meet their specific criteria so the home buyer’s are not having to search an area they are unfamiliar with and view hundreds of homes that don’t meet their needs.
The listing agent
The listing agent is also called the seller’s agent – their job is to represent the seller’s best interests during the negotiations and sale of the home.
The listing agent is also responsible for having the marketing materials for the home designed, deciding what the listing price will be, and getting people to view the home so that an offer is made.
The listing agent should be dedicated to the seller and their goals 100%. If a potential homebuyer tries to connect with the listing agent regarding other properties that might be a good fit for them – the listing agent is obligated to refer them to a different agent (a buyer’s agent)
The dual agent
This is the scenario where the homebuyer chooses to work directly with the listing agent for the property and the listing agent acts as both buyer agent and seller agent.
In some states, this is now allowed due to the potential for conflict of interest.
In the due agent relationship – it is not possible for the agent to be 100% loyal to either party. This relationship could be undesirable to many home sellers, as they are looking for someone to be watching out for them and their best interests.
How is the agent paid?
Regardless of the relationship – when the sale closes the seller will pay for the real estate agent’s commission from the revenue of the sale.
Then, the two agents (buyer and listing/seller) split the commission.
There are many twists and turns when it comes to selling, searching for, making an offer on, and finally purchasing a home. It is important to make sure that you have professional and dedicated representation – regardless of which side of the table you are on.