Selecting a Great Real Estate Agent

A real estate agent can help you make good decisions, whether you are buying or selling your home.  Remember that the seller always pays the commission on a real estate transaction.  The commission is usually split equally between the selling and buying agent. 

As a buyer, there is no direct cost to you to have the expertise of a realtor, and their experience can help you avoid mistakes and save you a lot of time.  In selecting a real estate agent, here are some of the most important things to consider:

• Get a pro!  Make sure your agent has many years experience in the local market in which you are buying. 
• Ask friends and work colleagues for names of realtors who did a good job for them.  Referrals are the lifeblood of the real estate business.  A good realtor will maintain contact with their clients forever so they will recommend them to others and use their services again for future transactions.
• Depending on your location, you may find realty companies that are nationwide along with local independent, or regional companies.  The ideal agent can be found in any of these companies, but the larger companies may have more marketing power when it comes time to sell your house.
• Check with the State Department of Business and Professional Regulation (DBPR) and you can find information about the standing of the agent, their license status, and whether any complaints were ever lodged against them. 
• Check for professional designations on the agent's business card, such as certifications, member of National Board of Realtors, etc. that indicate their advanced professional qualifications.  
• Interview several agents.  They know they have to sell themselves to you.  Ask how many years they have been active agents, ask for references, and make sure they are interested in working in the price range you are seeking.  Some agents specialize in higher priced homes and you won't get the attention you deserve if you're looking for something in a lower price range.
• Trust your gut feeling.  The right agent will be patient and take the time to listen to your preferences, answer your questions or address your concerns.  If they seem to be too busy or do not respond in a timely manner, they are not the right choice.
• Don't make a commitment immediately.  Ask them to show you some houses and you will get a better sense of how well they understand your needs and how well they know the area.  The chitchat in the car as you drive around will give you a good reading on if the personality of the agent is the right fit for you. 

What can you expect a real estate agent to do for you?     

The real estate business is heavily regulated by state and federal laws for the protection of the consumer.  The real estate agent or "sales associate" is licensed by the state to engage in the sale of real estate.  They act under the supervision of a licensed "broker" who is the person who manages or owns the company and is ultimately responsible for the actions of the "sales associates". 

When you meet with any real estate agent, they will give you a disclosure form that informs you of their responsibility to you.  Most agencies work on the basis of a "transaction broker relationship" which means that they may serve the interests of the buyer, the seller, or both.  Some states allow for "single agent relationships" which means the agent may act only on behalf of the buyer or the seller.  There may be a fee attached to this service.

The agent will likely recommend a mortgage company that will work with you, depending on your individual situation.  They may give you a list of possible brokers.  You need to get that process started to be "pre-qualified" for a loan up to a certain amount.  Many sellers will not show their home if you are not pre-qualified.

Make a list of your top priorities in the home you are looking for, such as quality of schools, maximum commute time to work, and most important home features like a big yard, quiet street, two car garage, etc.  This helps the agent show you the best matches from the beginning.    As you look at homes, speak up and tell the agent what you liked or disliked about each house and this helps them refine the search. 

As you start zeroing in on the right house, it's time to see if you have a really great agent.  They will help you with additional information like potential appreciation on your investment based on the areas or the home features.  They will highlight the most important things for you to consider in making a final decision. 

Once you decide on a house and want to make an offer, you must understand that a "tranaction broker relationship" does not allow your agent to divulge any confidential information about what the price the seller might accept.  So, you can't ask them, "what is the lowest price I can offer?".  But, you can throw out a price and ask them what they think.  A great agent will guide you to the right price.  They want to close the deal, but they also want you to be happy with their service so you can become the source of a future referral.  The agent will then make the offer and bring back to you any counteroffers, and handle negotiation of terms to address some items like leaving more appliances than originally offered, seller providing a Home Warranty, satisfactory home inspection, renegotiation if home appraises for less than the offer, pending sale of your current residence, etc.  

The agent will obtain a "sellers disclosure notice" which is a State approved form in which the seller must disclose any known defects or damage to the home.  In addition, the agent must disclose to you all known facts that materially affect the value of the property that are not easily observable to the buyer.  This would include any damage sustained by a flood or other event, any nearby zoning changes for a freeway or commercial construction, insure that any structural improvements were done with approved permits and licensed contractors, check public records to see if there are any construction liens on the property (outstanding unpaid bills for work done on the property). 

The agent will draw up all of the contracts, assist in any glitches with paperwork, and set the closing date in coordination with the seller's agent.  They will generally hold your hand through the process and be available to assist you and answer any questions.  The agent must provide you with the settlement statement within 48 hours of closing, so you may obtain a cashier's check for your downpayment and closing costs.  They will attend the closing with you, generally at a title company office, during which all of the paperwork is signed by the buyers and the buyers and the sellers.

A real estate agent works hard for their money and can direct you to the best properties to match your budget and your preferences and their assistance in navigating the legal process has great value.