From: trader4@optonline.net
Newsgroups: misc.consumers.house misc.invest.real-estate misc.consumers.frugal-living
Subject: Re: Buying a house without a buyer's agent - negotiating tips?
Date: 4 Sep 2006 16:17:03 -0700
   posting-account=vW3O0AwAAABxQqAj-ZYxYAKqrqLQW3tX


Terry Lomax wrote:
> texflyer@gmail.com wrote:
>
> > We are in TX and are about to make the jump and buy our first house
> > in the next 6 months or so.  At the moment, we are planning to do it
> > without a buyer's agent - we've been studying our target neighborhood
> > for a while and have a pretty good idea of what different types of
> > houses sell for, don't need help with finding a mortgage broker (we've
> > been saving for several years, so we'll just buy the house for cash),
> > have a good inspector lined up (a family friend), etc.  We are
> > fortunate to live in an area where the MLS is online, so we don't need
> > an agent to look at the listings.
>
> Your situation is more ideal for using a buyer's agent than most
> situations.  Here's why.
>
> There's a conflict of interest if a buyer's agent has ties with a bank,
> because the buyer's agent will steer you toward higher home prices so
> the bank sells you a bigger loan.


This is just nonsense.  I've dealt with lots of real estate agents and
never had the feeling that they were trying to get me to buy more
expensive homes so some bank they are in cahoots with can give a
slightly larger loan.    The simple fact is, most buyers know the price
range they are looking for and a real estate agent would be pretty
stupid wasting time trying to get them into a more expensive house for
the chance of what?  A bigger kickback from a bank?  Isn't that illegal
in most states to begin with, particularly if it's not disclosed?

If there is a conflict of interest, it's that it is in any agents
interest to just close a deal without regard to price, so they can
collect a quick commission and move on.   On the buy side, that means
they could have you pay $330K for a house that they think is only worth
$300, just to be done and move on.  On the sell side, it means they
would rather see it sold for $300K today, rather than sit around for
months and wait and see if they can sell it for $330, because the small
diff in commission aint worth it.


>
> There's a conflict of interest if a buyer's agent knows the inspector,
> because the inspector might pass a house with problems so the deal can
> go through and the buyer's agent can get the commission.

That's a valid point.


>
> It should be obvious to potential home buyers: when you get your loan
> preapproved, do NOT pick a buyer's agent based on recommendations from
> the loan company, and when you pick a home, do NOT choose an inspector
> based on a recommendation from the buyer's agent.
>
> With those two problems gone (as you're paying cash and you know your
> inspector), the only remaining conflict of interest is a problem that
> will NEVER go away: the buyer's agent will steer you to more expensive
> homes because he'll get a larger commission when he splits with the
> seller's agent.  You mostly have this problem solved because you said
> you find the listings yourself.  If the buyer's agent tries to steer
> you to more expensive homes, you can just tell him/her: "No, I'm
> looking to spend no more than $250,000.  If it's not worth it to you to
> help me buy a home that inexpensive, let me know and I'll replace you
> with a good buyer's agent who complies with my target price range, and
> I'll give him lots of recommendations that he did a good job and he'll
> get more business while you'll be out of the loop..."
>
> The buyer's agent can save you time by checking documents for the home
> you want to buy.



Let's see.  You think the agent is corrupt and working in cahoots with
a bank to force people into bigger homes.   You think the agent is out
to screw you by getting you into a bigger house for more commission.
Yet, you want the agent to save you time by reviewing documents?   LOL



>
> Regarding your main question, just give a low offer without specifying
> why.  If the seller's agent offers to take a smaller commission from
> the seller because there's no buyer's agent, great.  If they don't
> accept, move on.  It's a buyer's market.  The number of days a home is
> on the market is at an alltime high.  Home values continue to plunge,
> so perhaps they'll like your low offer in a month and accept it after
> all.
>
> One advantage of not using a buyer's agent: FSBO homes.  Buyer's agents
> whine if you show interest in an FSBO.  Realtors stick together, so
> they try to steer people away from the good people who sell directly
> without a parasite or two parasites collecting fat commissions for
> doing essentially nothing.
>
> Of course if you buy from an FSBO, you don't have to worry about a
> seller's agent getting a double commission.  There are so many online
> sites these days, it's easier to find FSBO listings than in the past.
> MLS doesn't list FSBO, does it?  I know realtor.com won't list FSBO.