5 Reasons You Need a Buyer's Agent

Having spent a year at Thornton Real Estate Academy obtaining my KY state real estate license and getting the complicated concept of "agency"drilled into my head from every angle, I often forget that the average homebuyer has no idea what a buyer's agent is or why one is important. (After all, buyer's agency is a fairly new concept especially in smaller markets like ours in Danville, KY). I thought I would kick off my blog, (please bear with me as I tune my "blog post voice"), focusing on that topic. After all, it's so important to make sure before you buy a home that you understand the parties involved (seller, seller's agent, buyer, buyer's agent) and what that means for you. As you go to purchase, how can you make sure your best interests are protected? How can you remain fair and honest with the other party without disclosing information that will hurt you in the negotiation process?

My answer to both of these questions: hire a buyer's agent!

1.) Clearly Understand What You're Buying: Is this house in a flood plain? Does the lot go to the other side of that creek? Can I park my RV in the front yard? These are all questions your buyers agent can help answer. Licensed agents have access to online portals for the PVA, MLS and know their way around a deed room at the courthouse to find the latest copies of neighborhood restrictions, help verify your property boundaries and more. This is all information you need to know up front before making a purchase you'll regret.

2.) Learn What The House Is Worth: Ever heard of a Zillow "Zestimate"? Don't ever look at one again. Okay, I know, that's harsh. But the truth is, it's somewhat of an impetuous figure based upon a limited scope of comparable data and oftentimes outdated sales prices at the PVA. Take this for example: My husband is a builder and he built some brand-new 3 bedroom / 2.5 bath / 2 car-garage townhomes over at Walnut Street Commons in Danville. When we listed them For Sale By Owner using Zillow.com (this was before I was an agent!), the "Zestimate" popped up for each unit as being $40,000. These townhomes were listed and sold in the upper $160s. Little did we know, Zillow was pulling the "estimated value" from the PVA which accounted for the lots only, not the total improvement. When I got calls from people saying they were overpriced, you can imagine my frustration! The real estimation of value comes from a combination of MLS data from MLS boards throughout the area and updated sales data from the latest mortgage records and deeds on file. There's not enough of that accurate data available floating in cyberspace, at least not right now, for those Zestimate figures to be completely accurate. To really know what a house you're buying is worth, you need a buyer's agent to conduct what's called a "Comparative Market Analysis" for you, taking into consideration current market trends, progressions and recent sales data in the area" (much like a professional appraiser does). Point: Let us help!

3.) Recognize and Identify Potential Home Issues: Let me make this clear: real estate agents and Realtors (yes, there is a difference -- we'll get into that later), are NOT licensed inspectors and should never, ever claim to be. We don't try to practice outside of our realm of expertise, and you as a consumer shouldn't expect us to -- we simply don't have the proper licensure. However, when you're walking through a house for the first time and you're taking inventory of what kind of snacks the seller likes to keep in the pantry (you know you do it), it does help to have an extra pair of eyes walking through each room with you to point out blatant defects that you may not recognize. As real estate professionals, we see a lot of houses, and unfortunately we also see a lot of contracts fall through due to inspection issues. Let us use our experience and knowledge of homes to help you identify some of those bigger issues on the front-end so you don't get yourself into more than you can handle.

4.) Sign A Sales Contract That Protects YOU: Now that I'm a Realtor, the thought of signing a Uniform Real Estate Sales and Purchase Contract devised by a seller or seller's agent gives me the heebie geebies (is that how you spell that?). But I sure did, in my past! Without knowing what your looking at and what each of the clauses in that six-page contract actually means, how can you be sure you're protecting your own best interests? What if you can't close within the allotted timeframe? What if you need to move in prior to closing, or you want a few weeks after closing to gain possession? How many days should you reasonably have (per your local market "norms") to conduct all of the proper inspections? How can you go about the process and keep your earnest money in the case of a voided contract? All of these things, and we haven't even touched on price or price negotiations. Hire a buyer's agent! You need one for the contract if nothing else. We make sure you're protected.

5.) Simplify Your Moving To-Do List: I have a list of 150 to-dos taped to my bulletin board by my desk each time a buyer or seller of mine obtains an executed sales contract. There is so much packed in to those 30-60 days from the point of an accepted offer to the closing date that has to be done. Collecting earnest money, scheduling inspections, coordinating appraisal, communicating with the lender, preparing repair lists, negotiating repairs, obtaining transferrable warranties, obtaining a home warranty, looking in to homeowner's insurance/HOA/restrictions, etc., coordinating with the title attorney, environmental issue abatement, and the list goes on and on. Why would you want to try and do all of that yourself while also packing up your entire house, transferring the kids' schools, changing jobs or whatnot? That just seems unreasonable. Don't try to be a superhero!

BEST OF ALL? hiring a buyer's agent is usually FREE! In most cases, sellers will pay the buyer's agent's fees, as they brought the buyer to the transaction and were responsible for helping to get it sold. That means you get all of these services without having to pay a dime.

If the sellers pay the buyer's agents, then why would the Kentucky Real Estate Commission allow buyer's agency, you ask? The answer is easy: the primary job of the Commission is to protect the interests of the general public -- and they know that you as a buyer need representation in what can sometimes be a cut-throat, competitive real estate industry. There are strict, enforceable laws in place through KRS (Kentucky Revised Statutes) to enforce the legal obligations of agency and ensure your agent is representing your best interests in all cases. You can read more about agent's fiduciary duties here.

Depending on the individual brokerage or agent you're dealing with, they may require you to sign an "Exclusive Buyer Agreement," which would mean you would compensate the agent if they spent a lot of time with you and you ended up not purchasing a home. However, I personally operate under a "mutual-respect" policy with my buyers. I'm more of the belief that if we develop a strong professional relationship that allows me to work hard for you in exchange for your loyalty, I'll get paid eventually -- whether you buy a house now, or you buy one 5 years from now. If I do a good job, you'll remember my name. That said, if I show you 17 houses and you call me at all hours of the night and go purchase a house using another agent, I will have to politely "break-up" with you. Notice I said "mutual". ;-)

Thanks for reading! Hope you found this helpful! Contact me anytime about being your buyer's agent, I'd love to hear from you! amandafrenchclark@gmail.com