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      02-26-2013, 08:35 AM   #1
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Home buying: agent or a realtor?

To piggyback on my other post... Regarding home buying.

Is it better to use a realtor or a real estate agent when buying a home?

Obviously a realtor is held to "higher" standards, but at what price cost difference?

Is opting for a realtor when buying really worth the extra money?

I start my search again for a good agent or realtor next week and am trying to gather all the info I can.

What are some good interview questions to ask when trying to select one? What else should I look for in selecting a agent or realtor?

(Obviously have been googling this too, just would like some fellow bmw owners to chime in, since we will ASSUME many of you are doing decent in life to own Both a bmw and an awesome house. )

I'm 26 and this will be my first home. In my area, I see houses go for 125k that would go for 400k to 600k in city areas - I "know" this by watching many hours of hgtv and see what some people pay for houses else, I am not in a large city area, and not suburbs of any large city. Harrisburg pa is about 30 mins away, Philly about 1.5 hrs, Baltimore an hour.
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      02-26-2013, 08:52 AM   #2
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A real estate agent is a realtor. I think when my sale went through I paid her something like $100. It's a rounding error amongst the other closing costs...
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      02-26-2013, 09:06 AM   #3
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Do yourself a favor - go online and look at as many houses as you think fit your own criteria (trulia and zillow are good resources). I have friends who did nothing on their own and spent weekend after weekend looking at dozens of houses thinking that the agent was doing something wrong, but you, as the buyer, should have an idea of what you're looking for and can easily aid in the process of locating the right house for you. I sit at a desk all day so I would look during lunch and actually was the one to tell my agent the houses we wanted to see. We looked at three houses and bought the first one we saw.

Need a garage? Don't bother looking at houses without one. Need a 3BR? Don't waste your time on 2BRs. Hate this particular neighborhood? Skip it! Simple things like that will speed things up a bit.
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      02-26-2013, 09:11 AM   #4
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I can send you to a realtor in the area there. Went to college with him and he is in the top 5% of realtors in Central PA... I believe he lives in the harrisburg Mechanicsberg area... Or you can just look him up. Derek Bicksler. RSR realty
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      02-26-2013, 09:16 AM   #5
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Buyers don't pay a dime for the agent. It is the seller's agent who splits commission with buyer's agent. And no, you dont pay any premium for their qualification.

Lastly, you would want to ask your agent about his transaction histories if you want to interview but I wouldnt. You would want to find a person who can click with you, not a person who passes your test. It all varies what buyer wants from the agent.
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      02-26-2013, 10:59 AM   #6
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Quote:
Originally Posted by jlstyle View Post
Buyers don't pay a dime for the agent. It is the seller's agent who splits commission with buyer's agent. And no, you dont pay any premium for their qualification.

Lastly, you would want to ask your agent about his transaction histories if you want to interview but I wouldnt. You would want to find a person who can click with you, not a person who passes your test. It all varies what buyer wants from the agent.
This isn't entirely true. The buyers do pay for the agent, just not necessarily in terms of a payment they can see. Yes, the seller's agent and buyer's agent would split the commission, but, if you use no agent you can always negotiate that into the price and tell the seller he only has to pay his agent the half commission and that way you get the house cheaper.

The cost of splitting the commission is built into the purchase price of the home by the seller - if they pay less commission, they will sell the house for less as long as they are at least made whole at the end.

I'm not sure if agents would do this, but you could also look into seeing whether they would give you a 1/3 or whatever of their full commission in order to be your agent. Not sure what the appetite would be for that, myself I probably wouldn't try that, but who knows. If it was an agent where they were both selling my house and also being a buying agent for me, then I'd certainly ask them for a discount on the sale of the house.
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      02-26-2013, 07:49 PM   #7
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Quote:
Originally Posted by KingOfJericho View Post
A real estate agent is a realtor. I think when my sale went through I paid her something like $100. It's a rounding error amongst the other closing costs...
No, realtor is a trademarked term, and not every agent is a realtor.

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Originally Posted by Joekerr View Post
but, if you use no agent you can always negotiate that into the price and tell the seller he only has to pay his agent the half commission and that way you get the house cheaper.
This isn't true, they can't show the house to you, either you get an agent and they get 1.5% or the sellers agent shows you and they get all 3%. Either way it's going to be up to the agent if they want to give up the commission, good luck getting them to.

Also unless the agent is a broker they don't even get all the commission, and the broker has a say in how much they could give up even if they wanted to.
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      02-26-2013, 08:39 PM   #8
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Originally Posted by jlstyle View Post
Buyers don't pay a dime for the agent. It is the seller's agent who splits commission with buyer's agent. And no, you dont pay any premium for their qualification.
+1

Buyers don't pay a dime.
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      02-26-2013, 10:02 PM   #9
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Quote:
Originally Posted by O-cha View Post
No, realtor is a trademarked term, and not every agent is a realtor.
Their job function is the same.
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      02-26-2013, 10:49 PM   #10
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Quote:
Originally Posted by KingOfJericho View Post
Their job function is the same.
Doesn't make me any less right or you any less wrong.
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      02-26-2013, 10:59 PM   #11
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This isn't true, they can't show the house to you, either you get an agent and they get 1.5% or the sellers agent shows you and they get all 3%. Either way it's going to be up to the agent if they want to give up the commission, good luck getting them to.

Also unless the agent is a broker they don't even get all the commission, and the broker has a say in how much they could give up even if they wanted to.
What are you talking about? Who can't show the house to you? You make no sense. There's no "requirement" to have either an agent or a realtor when selling or buying a house...just most parties choose to engage one.

And if you are selling a house would you really sign a contract stating that you would pay your agent 3% irregardless of the other agent if you don't even know the rate? Not likely, unless that agent idemnified you against any claims by the other agent.

So, if one side of the transaction doesn't have an agent, then the seller should be smart enough to say, fine, I'm only paying my agent the half they are entitled to. And reduce the purchase price accordingly.

You smell like a realtor who is afraid for his profession. No wonder - they make a killing and for what?
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      02-27-2013, 07:42 AM   #12
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Quote:
Originally Posted by O-cha View Post
Doesn't make me any less right or you any less wrong.


I just read the way I wrote it in my first post and I did write it backwards so you are just a little bit more right - for those keeping score.
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      02-27-2013, 10:56 AM   #13
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I was working with an agent that was charging 6%. Every offer i gave got shot down. I figured the sellers were already paying 6% for the sale that they didn't have room to negotiate with me. FF 6 months later I am buying a home on my own without any agents and I paying 13k below asking price.
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      02-27-2013, 02:02 PM   #14
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Buying agents arent entitled to a commission the selling agent is. And 6% is WAY to high im buying and selling with the same agent and she is only getting 3%.... BTW 13k below asking price is just a couple bucks off of your mortgage depending on the term and rate of course.
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      02-27-2013, 02:41 PM   #15
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Buying agents arent entitled to a commission the selling agent is. And 6% is WAY to high im buying and selling with the same agent and she is only getting 3%.... BTW 13k below asking price is just a couple bucks off of your mortgage depending on the term and rate of course.
So in your opinion, the buying agent is just helping you for the good of their health?

Kevinbahnz - good for you - these guys need to come down a peg or two, they charge far too much. Just make sure you have a good lawyer read over all the paperwork and everything if you're not using an agent.

And its refreshing to see someone who isn't duped by all this nonsense that O-cha is trying to spout about how one needs an agent / realtor.
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      02-27-2013, 03:22 PM   #16
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Buyers don't pay a dime for the agent. It is the seller's agent who splits commission with buyer's agent. And no, you dont pay any premium for their qualification.

Lastly, you would want to ask your agent about his transaction histories if you want to interview but I wouldnt. You would want to find a person who can click with you, not a person who passes your test. It all varies what buyer wants from the agent.
Yes this is not entirely correct info. Its all about what the closing bill of sale says. Most of the time it is the seller that pays but it can be split based on a percentage between the buyer and seller. And if you really get anal rapped the buyer can pay call the closing costs. Look at it this way; the more demand for the property the more leverage the seller has in negotiating terms for the closing.

Good luck in your home search.
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      02-27-2013, 03:34 PM   #17
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Buying agents arent entitled to a commission the selling agent is. And 6% is WAY to high im buying and selling with the same agent and she is only getting 3%.... BTW 13k below asking price is just a couple bucks off of your mortgage depending on the term and rate of course.
Yes 6% is high but they were splitting that between the buyers and sellers agent. A couple of bucks off monthly payments may not sound like much but $13k is a heck of a lot more than I would like to pay for anything..

Joekerr- Thanks with the information and resources on the internet you can do most of the research yourself The only thing we needed was for someone to let us into the actual property and let us walk around.
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      02-27-2013, 03:39 PM   #18
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Ok guys not here for an argument or debate... Anyways...

A realtor is generally speaking a person that is part of the board of realtors, agent or broker, etc...

It is not necessary that you join the board, but you cannot tell people you are a realtor (as mentioned above realtor is trademarked)... you are instead a real estate agent or other title depending on your job description...

As far as agent quality, it depends on the individual not whether they are part of the board of realtors.

Buying agents and selling agents deserve a piece of the commission simply because the selling agent list the property and hopefully markets it while the buyer's agent helps you find the property, brings in buyer for the selling agent (basically screening, as a seller you don't want your time wasted with people that can't obtain a mortgage or cash). They also schedule inspections, fill out paperwork, schedule appointments, and if you find a good agent help you through the home buying process as well. On the other hand if you are only working with the selling agent, you don't have anyone on your side and it is difficult to negotiate the buyer's agent split into the price because the seller probably signed a commission for dual agency meaning the selling agent receives the full commission if the transaction was a result of their "marketing" even if all they did is list it...

As far as who pays the commission... The seller does. If there isn't a buyer's agent and only a listing agent then the full commission would go to them. If there is both a buyer and selling agent the commission is split.

Yes buyer's agents are completely worth it to the person selling their home and to the buyer searching for a home.


I am technically a full time realtor, but really a direct response copywriter. PM me if you have questions or concerns. I picked up my licenses because I found most of the agents to be completely incompetent when I was looking to purchase a property, so for many of you that have had bad experiences and claim that buyer's agents aren't worth it, you probably had a terrible agent that didn't do anything for you. For seller's if your home didn't sell than you probably have a terrible agent unless there are extenuating circumstances...

Also guys i'm on facebook and one of the guys from Helix motorsports is also an agent so check us out or add me as a friend. Feel free to PM me, I am extremely approachable and will be glad to help. https://www.facebook.com/JwRealEstateKellerWilliams
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      02-27-2013, 03:42 PM   #19
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Obviously the price of the house has a lot to do with this but getting $13k off of asking price is nothing to crow about... I think I got $60k off mine.
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      02-27-2013, 03:52 PM   #20
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Quote:
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Obviously the price of the house has a lot to do with this but getting $13k off of asking price is nothing to crow about... I think I got $60k off mine.
yes agreed. mine is 10% of the asking price.
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      02-27-2013, 04:15 PM   #21
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Our "realtor" or "real estate agent" was a f*cking joke. She screwed up meetings between us and the seller and didn't do squat. And got paid thousands of dollars to do a sh!tty job. That was our first home so lesson learned.
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      02-27-2013, 05:03 PM   #22
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Given the current buyer's market, it seems to me that buyers should be able to negotiate more creative buyer's agent commission structures than merely 1/2 of the total sales commission (historically 1/2 of 6%, down to 1/2 of 3% in recent years). The typical structure doesn't incentivize the buyer's agent to negotiate the purchase price down; rather it incentivizes the buyer's agent to convince the buyer to pay *more* than what they expected (i.e. close the sale, get more $). Maybe something like this could be more of a market commission structure for buyer's agents (using fake numbers):

Assume the commission structure is 3% total, with 1/2 going to buyer's agent. List price is $500,000. So, under the typical structure, if sale is at list, then buyer's agent would get $7,500. But we could structure the compensation differently:

If the sales price equals or exceeds $490,000, then Buyer splits 1/2 of Buyer's agent's commission (so if the sale is at list, then buyer's agent would keep $3,750 and give the other $3,750 back to the Buyer).

For every $1,000 that the sales price is below $490,000, then Buyer's refund is 1/2 of the Buyer's agent's commission, less $75. So if the sale is at $475,000, then Buyer's refund is (half of $7,125) - $1,125 = $2,437.50. Agent keeps $4,687.50. If the refund becomes a negative number, then Buyer pays that amount as a bonus. So if the sale is at $425,000, then Buyer's refund is (half of $6,375) - $4,875 = -$1,687.50. So Buyer would pay the agent an additional $1,687.50.

Seems like this would make the buyer's agent's interests align with the buyer.
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