Should We Hire
A Buyer's Agent?
Question: We're going to be buying a home this summer and I've heard that today it's a good idea to work with a "buyer's agent." Is this good advice? Why is this agent different from a "seller's agent?"
Answer: It's simple. A buyer's agent represents only you in the negotiations. A seller's agent only represents the seller. The danger is that you'll work with a seller's agent, one who actually represents the other party.
Most people think that who pays the commission determines an agent's loyalty. That's not correct. Who pays the agent doesn't determine the fiduciary relationship. Often the seller's and buyer's agents end up splitting the commission, which the seller pays. It's up to the agent to declare who he or she represents. If you're not sure who the agent represents, ask. You have to be told.
Q&A: How do we figure out how much to price our home?
To see the real importance of a buyer's agent, consider the kinds of confidential information you might give your agent. You might find a house you like and tell your agent that although you're going to offer $200,000, you'd actually be willing to pay $220,000. A buyer's agent must keep that information confidential. A seller's agent must tell the seller what you said! If a seller knew you'd pay $220,000, how do you think that would impact on your initial $200,000 offer? Virtually any agent can declare for either buyer or seller . . . or both. Some agents declare that they represent BOTH buyer and seller. A few can actually pull this off, but it's a tough line to walk. I personally don't believe any servant can fully serve two masters.
Get an agent who represents you -- you'll be happier you did.
Mr. Irwin has more than 25 years' experience as a Los Angeles-area real-estate broker. He is the author of more than two dozen books about real estate and is recognized as one of the most knowledgeable writers in the real-estate field. Mr. Irwin's most recent book is "Tips & Traps When Buying a Condo, Co-op or Townhouse," (McGraw-Hill, 1999).
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George, Millbrae, Calif.
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