The Benefits of Using a Buyer’s Agent

Photo by Gerd Altmann via Pixabay

It may be tempting to purchase your first home without the help of a real estate agent. If you want to risk not having professional help to buy your first house, you can, but you’ll be leaving a lot of benefits on the table and assuming all the risks.

The Benefits of Using a Buyer’s Agent

A buyer’s agent works entirely on behalf of the buyer in the purchase process. The benefits of using one include:
  • Expert negotiations – Professional agents know the market, costs and what you’re looking for. They can combine the three, plus other variables, to create a formula for negotiating within both your price and comfort levels.
  • Full disclosure – A real estate expert knows what to ask regarding disclosures about the property. They’ll ask for items you may not even think of because of their experience. It’s not that the seller is intent on deceiving you, often they don’t know what to disclose either.
  • Neighborhood specialist – Some agents choose to represent buyers in specific neighborhoods and can tell them about local facts such as planned road construction or rezoning issues that might have an impact on your decision to buy there (both for and against).
  • Closing costs – Your buyer’s agent fights for the best deal for you, the buyer. Relying solely on the seller’s agent could end up costing thousands in extra charges.
  • Lender recommendations – An experienced buyer’s agent knows which lenders tend to close on time and which ones might drag out the process. If you’re closely timing a move, your agent can help you avoid being bogged down with a slow underwriting process. They’ll have recent experience with rates, terms, appraisals and comparable sales.
  • Making the offer – Real estate purchase offers have a lot of forms and papers that cover all sorts of things from contingencies to mold and asbestos mitigation. Your agent knows the right forms and what needs to go into your offer to both protect you and give you the best chance of having your offer accepted.
  • Inspection referrals – having a home inspection protects buyers from unexpected repairs and required renovations once the deal completes. Your agent knows reliable inspectors that look for basement seepage, dry rot, hidden mold, damaged roofs, sewer line issues and a host of other things. You might not think to check the chimney, but your inspector will, saving you from a potential house fire or other issues down the line. A failure in a major system such as electrical wiring, HVAC, or plumbing can wreck your budget if you don’t know about it.
Bottom line is that purchasing directly from the seller without the protection of a knowledgeable agent puts you at risk for all kinds of issues. Remember that the seller pays both agents from the proceeds of the sale. 

Should You Buy or Rent?

Owning a home is a must for some people. To some adults, a house represents family, tradition and the best form of equity. For others, having money to travel is a priority. If you’re trying to decide whether home buying or renting is best for you, consider how long you expect to live in a house.

Renting and home buying pros and cons
You could move to a different house every two to three years. But, each move would require you to negotiate closing costs, cover realtor fees and pay for necessary repairs or upgrades so that a buyer pays you the full value of your home.

The amount of disposable income that you want and how frequently you plan to move aren’t the only factors to consider. You need to find out if you can afford home buying over the long term, not just for the next three to four years. After all, even if you only plan to stay in a house for a few years, unless you make a hefty down payment or sell the house quickly, you’ll generally be responsible for a mortgage for at least 12 years, 30 years for a longer mortgage.

Therefore, consider your savings. Are you currently living paycheck to paycheck or do you have $10,000 or more saved? Some lenders offer loan calculators that you can use for free. Consider taking advantage of these options. Seeing how much you would pay each month for a house (and for how long) is a great reality check.

Your current choices aren’t set in stone
Also, think about your personality. Home buying might be a better fit for you if you don’t want to live close to your neighbors. Space to engage in hobbies like wood working or classic car collecting, host large social events, own large dogs and grow a garden are other reasons why buying a house may be best.

If you don’t know the first thing about home repairs and want access to an in-ground swimming pool, gym and community fellowship area, renting might be the way to go. Living in an apartment or renting a home could keep you from feeling alone if you’re single. You also won’t have to worry about property taxes.

But, you’ll never have equity in the home or apartment that you rent. You also won’t be able to take advantage of home ownership tax breaks. And you can’t leave a home or apartment that you rent to your children the way that you could if you buy a house.

The good news is that if you’re renting right now, you could start searching for a house to own as soon as you’re ready. Equally, if you currently own a house and decide to rent for a few years, you could start taking steps to go the renter’s route as well.