Real estate agents can be valuable resources
when looking for a home. About 85% of all homes
sold are listed with a real estate agent. But
it's important to know whose side they're on.
A seller's agent
Someone selling a home usually
does so through a real
estate agent. When the seller contacts an
agent, that
agent, from
that point on, works for
them. Real estate agents
are obligated to do whatever they can
to get the best deal for
their clients. You are
not their client. When they show you a
home, they are obligated
to tell the seller anything
you say. So if you tell the agent, "I'm
going to offer $90,000 for
this home but I'm willing to pay $100,000," the
seller will soon know that
you're willing to pay $100,000.
A buyer's agent
You can hire your own real
estate agent to help you
through the home buying
process. Since you engaged them, they are
obligated
to work for you, to get the
best deal on a home for
you. And even though you won't have to pay
your real estate agent anything,
they still work for you,
not the seller.
How agents make money
Real estate agents make a
commission on the homes
the sell, usually around 6-7%. So
if an agent sells a $100,000
home, the agent would get
$6,000-$7,000 in commission. If the
buyer also has an agent,
the buyer's agent and seller's
agent split the commission. So in the
earlier example, both agents
would get $3,000-$3,500
in commission. That commission is paid out
of
the money the seller gets
from the sale. Even though
the buyer's agent works exclusively for
the buyer, the buyer doesn't
have to pay him or her
a cent.
