How to Work with a Real Estate Agent to Buy a Home

By Damon Poeter

Buying a home for the first time might be the biggest financial decision-making process you’ll ever embark upon. Hiring the right real estate agent to help you in your search is the first order of business, but once you’ve found an agent, how do you keep tabs on how they’re performing in their job?

If you’ve done your due diligence in hiring an agent, chances are they’re doing their best to find you a home you can afford, with the particulars you’ve asked for, in an area you’d like to live. But good real estate agents are busy people, and it’s a smart idea to take a bit of a “squeaky wheel” approach to ensure your business is a top priority.

Buying a Home Is a Team Effort
As important as real estate agents are, they aren’t the only members of the team you’ll need to assemble to buy a home.

Unless your agent is also a real estate broker, they must work for a licensed broker. You may never need to work directly with your broker, but if your agent isn’t performing, that may become necessary. You may also require a mortgage lender, a home inspector and an appraiser, among others. You’ll want to do your own ongoing research into area schools, comparative property values and the local economic climate.

“First-time home buyers often think of their real estate agent as their quarterback for all things home-related,” says Matthew Angel, advice director of home advice & personal finance at USAA. “While your agent is important, they’re different than the lender you choose for financing. A real estate agent can recommend a lender, but you don’t have to go with their recommendation, and it may pay to shop around. Your real estate agent can be a fantastic guide for setting up things like inspections and appraisals, but you are the one hiring all of these players.”

Here are some key ways to track the job your real estate agent is doing.

Offer and Expect Prompt and Courteous Communication
Communication with your real estate agent is essential and is a two-way street. 

 “You want an agent who responds in a timely manner, and it’s perfectly reasonable to expect your real estate agent to work hard on your behalf,” Angel says.

Come to an agreement on the best communication channel you both prefer and what hours your agent keeps for working with clients. An agent may give you a personal cell number, but in practice be more responsive to calls made to their work line. Some people prefer emails to texts and vice versa, so it’s best to discuss how you’ll communicate upfront.

Check Up on and Coordinate with the Agent Regarding Listings
If you haven’t heard from your real estate agent in awhile, give them a call and ask for listings to look at for possible showings. If your agent seems to have put you on the back burner, it may be because they’ve shown you a lot of listings and taken you to visit various properties, but you aren’t giving any signals that you actually want to buy a home. If that’s because you’re very selective in what you want, clearly communicate your priorities to better help your agent find you the right home.

Game-Plan Open Houses and Showings with Your Agent
Your agent will always accompany you on scheduled private home showings. You may wind up attending open houses on your own, but if you have a broker agreement with a buying agent, tell this to any other agents you encounter at an open house. Whether a private showing or an open house, it’s best to work out beforehand with your agent what sorts of questions you should be asking the listing agents and which are best left to your buying agent.

Be Aware of What Your Agent Can and Can’t Do for You
Federal, state and local regulations limit the things an agent can do and the information they can share with you about particular listings.

The Fair Housing Act, for example, prohibits real estate agents from answering questions about the racial and ethnic makeup of a neighborhood. In some states, agents aren’t allowed to discuss the crime statistics of an area but will instead suggest you contact the local police department or conduct your own research. Some agents won’t discuss the boundaries of public school districts with you for regulatory reasons or because agents have been sued in the past when homebuyers haven’t been able to enroll a child in a specific school they were told was in their district.

Don’t Be Afraid to Discuss the Terms of Your Broker Agreement
“Many reputable agents (and the real estate brokers they work for) only work with homebuyers with a broker agreement, providing them with guaranteed compensation and exclusive rights to represent you,” Angel says. “In other words, you work with that one agent and that agent only.”

Homebuyers in the market for low- to mid-priced homes are generally asked to sign a buyer broker agreement with exclusive rights to represent, with the agreement lasting anywhere from 30 days to a year. Such agreements generally state that: 

  • The buyer (you) cannot hire more than one broker or agent to represent them.
  • The commission your agent will receive on a home purchase is negotiable and agreed upon before signing the broker agreement.
  • The buyer has the right to demand “single agency,” meaning you can require your agent and broker to only represent your (buying) side of a transaction, rather than also serve as the seller’s representative in an arrangement called “dual agency.”
  • The buyer is not responsible for the commission if another party (such as the seller) pays it.
  • The broker or agent can receive a higher commission than the negotiable fee stated in the agreement if the seller elects to pay more and it is disclosed.

Such terms limit a buyer’s ability to broker a deal on their own or to work with another agent, but they also serve as a promise by the hired agent to work diligently on behalf of their client. If you feel your agent isn’t living up to the terms of your broker agreement, let them know.

Know When to Fire Your Agent or Broker
Hopefully, before you sign your broker agreement with your agent, you received assurance that the agent and their broker will release you from the agreement if you wish. If so, simply request an end to the contract when you decide it’s not working out.

If you didn’t get that promise, the agent may choose not to release you, which can be extremely frustrating if you have months to go in the contract and the agent isn’t performing. If you find yourself in this situation, you can ask the broker the agent works for to intercede and assign you a different agent.

If that fails, you can try to negotiate a better deal for yourself, perhaps finding another buying agent who agrees to represent you but will share a cut of their commission with the first agent on any home purchase made within the timeframe of the original broker agreement.

Remember that members can receive a $350 to $24,000 reward, with an average reward of $1,230, when they buy or sell a home through the Real Estate Rewards Network. Click here to learn more.

Matthew Angel serves as the advice director at USAA, focusing on the personal finance tenets of short-term saving and home advice. Matthew holds professional credentials including a CERTIFIED FINANCIAL PLANNER™ designation, AAMS® and a Master of Business Administration degree from the University of Texas at San Antonio. Matthew’s history at USAA includes seven years serving members as a financial planner and leading teams of financial professionals to help members achieve financial security. Outside of work, Matthew enjoys hunting and riding motorcycles, and is a proud husband and father to four kids.


 

USAA Real Estate Rewards Network is offered by USAA Residential Real Estate Services, Inc., a licensed real estate broker and subsidiary of USAA Federal Savings Bank. Program may be unavailable for employer-sponsored relocations. Not available for transactions in Iowa or outside the United States. This is not a solicitation if you are already represented by a real estate broker.

*Reward offer limited in some states. Reward amount is based on sale price of home sold or purchased and cannot exceed $24,000 per transaction. To receive the maximum amount offered of $24,000, the sale price of the home sold or purchased must be $4 million or more. In 2017, the average member closing in the program received $1,230. Real estate agent fees still apply. The reward is not available in Alaska, Oklahoma or Louisiana. In Kansas and Tennessee, a loyalty card will be issued that is accepted at specific retailers. In Oregon and Mississippi a credit or commission reduction may be available. In New Jersey, a commission reduction or rebate may be available at closing. Please check with the program coordinator for details. You must be enrolled in the program and be represented at closing by an approved agent with a participating real estate firm in order to qualify for the reward. Reward not available to sellers in a short sale transaction. In certain states, buyers may need seller cooperation in order to participate in the reward program. Availability restrictions apply.

Membership eligibility and product restrictions apply and are subject to change.


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