There are commonly 2 parties to a real estate transaction – a buyer and a seller. Depending on which side you’re on, your agent is either acting as a ‘buyer’s agent’ or a ‘seller’s agent’. While for most people it’s clear what the seller’s agent does, I have noticed it’s not always clear what a buyer’s agent’s role is.
Today, I explore the importance of working with an agent when you’re buying a home, including specifics on what a buyer’s agent does for you, how they’re able to represent and protect you when buying a home, and also how they’re compensated.
What is a buyer’s agent?
Let’s start by defining the term “buyer’s agent”. In any transaction, real estate or otherwise, there are two parties, a buyer and a seller. If you’re looking at homes and centers, all those homes you’re looking at are represented by a listing agent. The listing agents responsibility is always to work in the best interest of the selling client. So when you work with an agent to find and purchase your next home, that agent is working as a buyer’s agent.
What does a buyer’s agent do?
Early on in the process, the buyer’s agent will help you focus your search, the broker can use his knowledge of the area to help find a perfect match for you, whether it be near a school or near a highway. They can tell you the little quirks about a neighborhood.
Quick access to new listings
When working with a buyer’s agent, they get to know you. That means when a new property hits the market, they can identify it faster, allowing your to schedule visit right away rather than missing out on the opportunity. As you know, properties are currently moving quickly, so it’s important to move fast. Sometimes your broker will even get wind of a property that is not even on the market yet and can give you a heads up before anyone else.
Due diligence during house visits
Your buyer’s agent will also accompany you on any visits. And while you tour the home and look around, they’ll be looking at things through a different lens. Keeping an eye on anything that needs to be added to the offer should you decide to make one, they can use their expertise to identify things that may need to be focused on during the inspection, things that you may not have noticed if you don’t see houses every single day.
Structuring an offer that gets accepted
Once you find a place you like and want to make an offer on, this is ehen the biggest benefits of having a buyer’s agent start. To begin with, they’ll advise you on how best to structure your offer to maximize your chances of getting it accepted. Having first-hand knowledge about other sales in the neighborhood is a really big advantage when writing yours.
Handling the paperwork
As part of this step, they actually handle the relatively complex legal paperwork for you. They’ll review everything with you in detail, but are also there to add a layer of protection for buyers–not just with their expertise, but through the significant errors and omissions coverage through the governing body for realtors in Quebec.
Coordinating the sale
Once your offer is accepted, the buyer’s agent will collaborate with all the various parties to complete the transaction and satisfy any conditions. This may include various inspections of the home, working with the mortgage broker to complete the financing, scheduling an appraiser and also working with the other broker to coordinate and ensure that all conditions are completed before the deadlines.
Once the sale is completed, your buyer’s agent is there to answer any questions you might have and they’re also there in the rare event you might have to go back on the seller for anything.
How are buyer’s agents compensated?
Okay, so this leads to the big question a lot of people’s minds, how does the buyer’s agent get paid? So the way this works is that when the sellers agent list a home for sale, they agree at a commission that the seller is willing to pay for their services. This commission is then split between the buyers broker and the selling broker. In other words, you don’t have to pay the buyer’s broker directly. Their payment comes once they’ve helped you secure the home you want and it’s included in the sale price.
This is #AskPete. If you have any real estate questions, feel free to send them and I will get you the answers. Or stay up to date on the latest tips for real estate buyers and sellers by clicking the YouTube button below: