FAQ's; Frequently Asked Questions About Buyers Agency
Can The Sellers Agent Negotiate on My Behalf?
Not legally. The listing agent would be liable for any breach of duty to the seller if they helped you in any way that is not in the best interests of the seller. For example, a sellers agent is not allowed to disclose the seller's 'bottom line' price or strongly advocate any form of seller concession such as taking back a mortgage, etc.
Ok, What If I Find a Home and Decide To Buy It and The Listing Office Assigns a Different Agent From Their Office to Represent Me?
They may tell you that they are representing your interests but they are not. At least legally they are not. Why? Because California law states that in the event that the same real estate company/office lists a house that even two different agents in that company/office cannot represent both the buyer and seller. Instead, under the law, they must become "Dual Agents". Or they can choose to represent only the seller, leaving you with absolutely no one to represent you. Dual Agency is legal in California but it requires that the agents representing both buyer and seller cannot become the advocate for either! Listing agents or large companies will argue that it is legal. They are correct, it is legal. But is it the right thing to do? I say no! In fact, I cannot tell you how many times I have seen the listing office represent both buyer and seller and sell the property for too low of a price, sometimes without even giving the property adequate marketing. In this scenario, the listing agent has sold out his original client, the seller, in order to get an increased commission by "double ending" the transaction.
Do Listing Agents Seek to "Double End" Transactions?
In my experience it varies. Some are highly honest and ethical and look out for the sellers to the best of their ability. Others savor the chance to double end a transaction by reverting to dual agency and "trying" to give the impression to both the buyer and seller that they are both being adequately represented. There are honest agents out there and there are dishonest agents out there. Some are very smooth, and make you think they are on your side while all the while they are scheming behind your back. Real Estate Agents have a reputation akin to used car salesmen for a reason! You may be working with a very honest sellers agent; the problem is you just don't know. There are agents out there who are very personable. They seem very likable. But some of these same agents are not trustworthy. And you just don't know. Its better to be safe than sorry later on; use an agent who is only working for you. Click here for a list of 20 reasons to use me, Bill Polsley as your personal Buyers Broker.
What Character Traits Do You See That Are Common Among Buyer Agents?
There are common traits among those who are drawn to help Buyers. I've gotten to know some of the top Buyers Brokers in the country over the years. Thats because as one of the nation's top Buyer Brokers I have been asked to attend meetings and share ideas with these people. I've also worked with many agents in my own company who were attracted to the specialization of helping Buyers. Here are some of the common character traits I have observed;
- Top ethics and honesty
- A sense of fairness
- Good character
- Not driven to make huge amounts of money
- Hard working
- Enjoy a sense of accomplishment from helping people
- Exhibit the desire to do the right thing
- Like to get to know people and develop relationships
Why Would Agents With These Character Traits Be Drawn To Buyer Brokerage?
I'll give you my opinion; not all agents will agree with this. I feel that working as a Buyers Broker involves a desire to help people and is in a way more like a higher form of duty (as compared to working to earn lots of money) that attracts agents with a high degree of integrity. Buyers interests cannot be fairly represented in a transaction by the seller's agent, nor by any agent working in the seller's agent's company/office. People who have a high sense of ethics and honesty can see that. Many agents with the positive positive character traits listed above are uncomfortable representing both buyer and seller in a transaction. Many agents get into the business and see unfair or unethical practices being performed by other agents. Some leave the field in disgust. Others forget their conscience and change to "adapt to the field". Others decide to do what their character tells them to do and choose to represent only one side in a transaction. Some of these become Buyers Brokers. I am generalizing; I know there are many honest agents out there who practice dual agency. After all it is perfectly legal, at least in California. So don't look with disdain on all agents who have chosen not to be Buyer specialists. But in the end, in my opinion there is a real positive difference in the agents who have made a purposeful decision avoid dual agency and to concentrate on helping buyers.
My Neighbor Listed His House and Then It Was Sold the Day They Put The Sign Up - Was He Fairly Represented?
Your friend may have been fairly represented and he may not have been. If the property was marketed well before the sign went up and if a competent and through comparative market analysis was performed, he or she may have sold it for top dollar on the day the sign went up. BUT, if the home was never put into the Multiple Listing Service and if the listing agent or anyone in his or her company/office represented the Buyer, then the seller may have been "sold down the river". If that happened, the listing office would have had to become a dual agent, even if two different agents were involved. The Buyer may have been deprived on full representation too. The winner; the listing company/office who may have made a killing by "double ending" the transaction at the expense of not getting top dollar to the seller and at the expense of providing single agency representation to the buyer! Both the Buyer and Seller are cheated. I can't tell you how many times I have seen this practice in recent years.
Do Some Buyers Pay Too Much?
I see it all the time. I tell my clients that our competition may be writing an offer to pay more than they should. We just we have to learn to deal with that fact. Why would they overpay? Because the agent they are working with may not really be on their side. The prospective Buyer may be working with the sellers agent. Or they may be working with an unscrupulous agent who is more focused on making the deal in order to get the next bigger car or pay his advertising bill than he or she is on helping the buyer. It is not uncommon for us to lose out to buyers who are using these agents. That is part of the process we must go through. As the saying goes, their is a sucker born every minute; and there are agents who are more than happy to cater to these people! The important thing is for you to be properly informed and coached by a good Buyers Broker who is working only for you, not for the seller or for his or her selfish gain. You will be able to feel good about the home you eventually do buy, with confidence that you did not pay too much, even if you lose out one some deals because others overpay.
Can I Trust Real Estate Agents?
Most agents are good people. They are trained to adhere to a standard of ethics and are always on guard not to do anything that will get them sued. I do not see other agents, regardless of who they represent, out there just lying all the time. Most of what I hear from other agents I feel I can believe. So I have learned to trust other agents up to a certain point. The area where I have learned not to trust other agents is when it comes to issues that make a substantial impact on the amount of money they are going to get paid. Generally, if another agent has a chance to double end a deal, trying to represent both buyer and seller in order to get double or nearly double the commission, I have found they will do it. They will reason that they will do all they can to make dual agency work and to be fair. They will reason that it is, after all, perfectly legal. And they will do it. Many times these same agents will list the Buyers house and earn a 3rd commission. It is very lucrative. Exclusive Buyers Brokers forego the opportunity to double end a transaction and/or list the Buyers house. They do this knowing it will limit their income. They do it feeling they are doing the right thing. Which type of agent would you prefer to work with, the one who bases his or her business on sound principles that he or she believes in or the one seeking the most financial gain?
How Long Will You Work With Me?
I work with many buyers for months until we find the right home at the right price. I always say that I will not get discouraged until I have written ten offers for you. I have written seven or eight offers for many clients, but I don't believe I have ever written ten. I will not get discouraged working as your advocate. In contrast, there are agents out there who focus on getting listings. I've heard these tell other agents that they will drive Buyers around and show them homes one time. After that they drop the Buyers or sometimes even before helping a Buyer at all they just turn them over to an inexperienced new agent. The Sellers Agent calls this a junior person a "Buyer's Agent" on their team. But is this really looking out for the best interests of the Buyer? I don't think it is! And when listing agents have Buyers Agents on their team, they are in effect saying that there is an advantage to using a Buyers Agent or Buyers Broker. So even top listing agents are advocating the use of a Buyers Broker! Here is a list of 20 reasons why you should consider using me as your personal Buyers Broker.
Can An Agent Represent Both A Buyer and a Seller?
Yes, legally in California (at least) this is what is known as "Dual Agency" but everyone knows you cannot effectively serve two masters. It is almost impossible to avoid a conflict of interest, even for a very honest agent. The dual agent will be able to facilitate the transaction but since they must be impartial, they can't negotiate for either party. You should check with your lawyer before you get involved in this type of arrangement.
Why is Dual Agency Legal in California?
Real Estate is big business. Huge business. There are many giant real estate companies. They make lots of money. They make lots of money through use of dual agency. Because they have huge offices, there is a good chance they will become dual agents on a relatively high number of listings. These companies do not want to see dual agency abolished in California. As a result they spend huge sums of money lobbying legislators to protect their interests. A number of states have laws that are different from California. Some states are looking at enacting laws making dual agency illegal. The situation is not likely to change soon, however because the same large real estate multi-companies operate in all states. They lobby extensively at both the state and federal levels. They know what is best for consumers and they know what is best for their profits. I guess you can expect to generally see big business put profits as a higher priority than the protection of consumers rights.
Do I Really Need My Own Buyers Agent?
Yes - It can make a big difference! Consider this. When a professional actor or athlete enters into contract negotiations, do they use the studio's or the team's agent? Certainly not - they would use their own! If you were the defendant in a serious lawsuit, would you use the other side's lawyer for your defense? Of course not! In real estate, we have a very similar situation, with hundreds of thousands of dollars at stake. And yet people still approach the sellers agent expecting that somehow they will 'get a better deal'. This is a big mistake! Remember, without an agreement to the contrary, ALL real estate agents represent the seller, not you the buyer!
With Disclosure Laws, Is There Still Reason To Worry About Representation When Buying A House?
A recent study showed that more than 70% of all home buyers mistakenly believed they were being represented by the agent showing them homes. California has enacted consumer protection laws that require all real estate agents to disclose to consumers, who they represent BEFORE getting too involved. Unfortunately for consumers, these disclosure forms are a little vague and many agents fail to fully explain the forms or do not present them until negotiations get started - then it's usually too late to make changes.
How Much Does It Cost To Hire A Buyers Agent?
There is NO CHARGE. My Clients are pleased to discover that not only are all these valuable services FREE but also that by using my services they will actually SAVE money. In California the law has a provision for a Buyers Broker to be paid by the seller through the seller's agent even though the Buyers Broker is only representing the Buyer. So my duties and obligations can be totally on your side at no cost to you!
Can You Help Me Buy For A Lower Price?
Yes, I can! In fact I do it all the time, since I work for the Buyer and not for the Seller. There have been a number of studies over the past few years that show Buyers who used a Buyers Broker saved money. One Buyers Broker Company was even sued and had to prove in court that they saved clients money. And they prevailed. The bottom line; A good Buyers Broker will save you money!
How Will You Save Me Money?
The best way for a home buyer to save money is to pay less for a house. Before making any offer, I always conduct a thorough background analysis of the subject property and recent comparable sales activity. My in-dept research together with my top negotiating skills allow us to buy properties for less. That extra percentage point or two can add up to thousands of dollars that go straight into your pocket! If you work with me, you will never unknowingly over pay for a home! In addition, I can also help you shop for mortgages and loan programs that will save you even more money. The right lender with the right rates and terms can save you tens of thousands of dollars. Your personal and financial information always remains confidential and is not shared with anyone without your consent. This is certainly to your advantage during negotiations. Traditional seller's agents are required, by law, to disclose any information about you the buyer to their client, the seller.
If You Work For A Commission, Why Would You Try To Negotiate a Lower Price For Me?
For every $1000 that I can save you on the price of a home, it only reduces my commission by about $25, so I am much more concerned with your satisfaction than with my commission. I will gladly help you save thousands of dollars because my future business depends heavily upon the referrals from happy clients - and thats what it's all about!
Working with me will afford you a mich higher level of representation and protection by eliminating the conflict of interest and making the whole home buying process much more efficient. I will provide you with the highest level of dedicated service and solid professional advice. I am well positioned to negotiate the best price and terms on your behalf. I will save you a lot of time, effort, aggravation and money. Contact me today! Here are 20 reasons why you should use me as your Exclusive Buyers Broker!
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