Looking to buy a home? If so, you may be deciding whether or not you want to work with a buyer’s agent. With the rise of home search sites like Zillow, Redfin, and major brokerage sites, it might seem like working with an agent is unnecessary.
Here, we answer the top questions about working with Buyer’s Agents.
What does a buyer’s agent do?
A good buyer’s agent has shifted with the advance of technology. We know you don’t need us to look up homes on the MLS, although a buyer’s agent can certainly help narrow your search.
In addition to helping find the perfect property, a buyer’s agent will:
- Advise. Buyer’s agents work in the market everyday. Therefore, they know the current trends and value of homes in the area. They will offer their professional recommendation for what is a good deal within your budget, without the emotional attachment you may feel when looking at your dream home.
- Negotiate. Working with a buyer’s agent means someone will be looking out for your best interests. They negotiate the sale price and terms of buying a home.
- Complete Paperwork. There’s a great deal of paperwork involved in buying a home. A buyer’s agent will write up the contract and handle any additional paperwork for you.
- Recommend Professionals. Agents have experience working with home lenders, closing attorneys, home inspectors, and insurance agents. They can offer recommendations for professionals with excellent reputations.
- Communicate. Buyer’s agents communicate with you throughout your home search. From a new property on the market to issues that arise with home inspection, the buyer’s agent will lay out all information for you.
How much does the buyer’s agent get paid?
This can depend. When selling a home, real estate agent commission is usually between 5-6%. The listing agent and buyer’s agent come to an agreement on commission split. The buyer’s agent typically receives 2.5-3% of the home sale price.
Who pays the buyer’s agent?
If you’re an agent you’ve likely been asked this more than once, and if you’re a home buyer this is potentially the number one question on your mind. When buying a home with the help of a buyer’s agent, compensation comes from the commission of the home that is sold.
The most common scenario is when a buyer’s agent is compensated by sharing the commission paid by the seller. The listing agent enters the property for sale on MLS (Multiple Listing Service), offering compensation to a buyer’s agent for bringing them the buyer.
In short, you typically pay nothing for enlisting a real estate agent to help you find a home, as the seller is essentially paying your agent for finding YOU, the ready and willing buyer!
Instances where the buyer pays the agent directly are not common, but they can happen. An example is if you buy a home that is for sale by owner. Since commission is not being offered by the seller, the buyer may end up paying for their agent.
Why do I need to sign a contract when working with a buyer’s agent?
If you don’t actually pay the buyer’s agent yourself, then why sign a contract? Well, the buyer’s agent spends a few weeks to several months offering counsel, communicating, and showing homes to the client. A contract with a buyer’s agent, often called an Exclusive Agreement, helps to ensure that you are only working with one agent – thus saying you respect their time and energy, and want them to be compensated for their efforts.
Buyer’s agents can add a great deal of value to your home search, as long as you find one you trust and communicates with you on a regular basis. We encourage meeting with more than one agent, so that you can find the best fit for you!