Tell your agent what you are looking for and why. Make it clear upfront how often you wish to communicate, your budget, your timeline, and any barriers you’re up against. —-
If you’re new to buying a home, you might be wondering where to start and how to work with a real estate agent. Sure, the internet is a decent resource (it probably led you here! welcome!), but after scrolling through pages of agents with the same star ratings and blindingly similar reviews from clients, you probably still aren’t sure where to start.
How do you know if an agent is good or not? What can a real estate agent really do for you, and how do you find the right one?
Here we will guide you through everything you need to know about working with a real estate agent for the first time, including a step-by-step overview of the homebuying process, from finding an agent to signing all the paperwork.
What is a real estate agent?
A real estate agent’s job is to represent their client’s interests in a real estate transaction.
Regulatory agencies in every state license real estate agents. The exact requirements vary from state to state, but you can generally expect agents to have been through some training and have passed a certification process. Agents often have opportunities to engage in ongoing learning as well to stay up to date.
Many agents are members of the National Association of Realtors® (NAR). The word “Realtor®” is the term used to refer to NAR’s members. Members must subscribe to a code of ethics that covers many real estate best practices.
Some agents specialize in working with buyers (buyer’s agents), some with sellers (listing agents); some specialize in specific neighborhoods or blocks; some specialize in types of homes (for example, waterfront homes). And some states allow a kind of real estate deal known as dual agency — when an agent represents both the buyer and the seller in the sale.
According to Cindy Boutwell, a Houston-area real estate agent with more than 20 years of experience, “An agent will hold your hand as you go through the process and help you find the neighborhood that best fits your lifestyle and financial capabilities.
“Agents know the area. For example, you don’t want to buy a property that backs up to nature, only to find a mall is about to be built right behind your house.”
A quality agent can help you avoid mistakes like that and many others involved in real estate deals.
How do you find an agent?
You may have seen real estate agents advertising their services on the internet, or you’ve driven by real estate offices, so you likely know how to find an agent … but how do you find the right agent for you?
Let the following steps serve as a guide for getting started.
Step 1: Determine what you’re looking for
The first part of the process is to make a list of your needs and parameters.
What type of home are you looking for? What features are essential? What is your budget? Are you concerned about schools in the area? Property tax rates?
You may want to consider attending a first-time homebuyers class for more ideas.
Step 2: Find agents that meet your criteria
Making a detailed list of what you’re looking for and what you need will help you narrow down your search to buyer’s agents who specialize in the locations and types of homes you are interested in.
Consider asking friends or family members who have had recent home-buying success for a referral. Even faster and more effective: You can search for agents meeting your specifications online on sites like ours by using the agent-matching tool.
Step 3: Read reviews to narrow your search
Once you have a preliminary list of local agents, you can read their reviews. According to Boutwell, as with most things these days, “You can find reviews on agents just about anywhere.” Then you can eliminate any agents from your list that have been poorly rated or reviewed.
But hopefully any referrals or agent-matchers will do a good enough job that this can also serve as a research step: What do other buyers really appreciate about these agents? What problems did they solve for their clients?
Step 4: Ask questions of prospective agents
After compiling your shortlist, it’s time to interview your top choices. Ask questions such as how long the agent has been in business and whether they have experience finding homes in your price range and in the areas you are looking to live.
Not only does getting questions answered help you determine if the agent can do what you need, but it will also give you a sense of their personality and whether or not they are approachable for you or compatible with you.
Look into each agent’s availability as well; this can be critical in a very active seller’s market. If your agent is unreachable outside of standard 9-to-5 work hours, you can easily end up missing out on opportunities to tour homes or encountering other communication difficulties.
“If an agent doesn’t have their cell phone posted,” says Boutwell, “or they list restricted working hours,” those can be red flags for buyers.
Step 5: Choose your agent
Once you have chosen an agent, you can expect to sign a buyer broker agreement to protect both of your interests. This agreement outlines how your agent will get paid, most likely from a commission on the sale.
Some agents might request a flat fee instead of an agent commission, but according to Boswell, if your agent asks you to pay them upfront, this could be another red flag, according to Boutwell. It’s not typical for agents to get paid before the deal has closed; usually, they’ll receive their compensation at the closing table.
Tell your agent what you want and why
When it comes to the relationship between you and your agent, the critical thing to keep in mind is that you are in charge.
According to Boutwell, “Sometimes first-time homebuyers are just grateful to get a loan or a home at all — but they need to understand: everyone is working for them. The buyer is like the CEO of the whole process.”
Tell your agent what you are looking for, what you want, and why. Make it clear upfront how often you wish to communicate, your budget, how much wiggle room it might have, what your timeline is, and any barriers you’re up against.
If something happens that you don’t like, say so. If you are unhappy with the lender’s terms, you can find a new lender. Ask your agent to explain any documents you don’t understand, and don’t be afraid of seeming unknowledgeable. Your agent has likely worked with many first-time homebuyers, and they’re there to serve you.
Making the offer
Once your agent has helped you find a home you like, it’s time to make an offer. Your agent will write the offer, and if it’s accepted, it will become the sales contract. The offer will include any contingencies and a timeline for when everything needs to get done.
If the seller doesn’t accept your offer but counters, your agent will help you during the negotiation process.
Along with making the offer comes securing the financing. You may complete this part of the process even before finding a home you like by getting preapproved for your mortgage loan by a lender. However, the lender will still need to approve the final loan amount for the house you choose after the offer is accepted.
According to Boutwell, new homebuyers often don’t realize that securing financing is not a 24-hour process.
“Lenders don’t just ask to run your credit. They also require your bank statements, your pay stubs. They’re going to look at your debt-to-income ratio; they’re going to look at all of this stuff before offering you a loan. And even after providing all your information, the lender may come back needing more.”
The key is, “Don’t get freaked out, and don’t get upset. The lender is just doing their due diligence.”
Keeping the deal ticking along
After you get an offer accepted, beware that the remainder of the process can still take a while. Not only does the financing have to get final approval, but there is a lot more that has to happen.
There may be back-and-forth around the contract contingencies — including an appraisal, inspections, a title review, and many other details that must be taken care of before you can finalize your home purchase.
Your agent can help you keep tabs on the transaction and ensure all tasks are completed on time. If there are any problems with the inspection or appraisal, your agent will help you negotiate around those, as well.
Finally, your agent will also likely come with you on the final walkthrough to make sure everything is okay before you sign papers.
Closing and beyond
At the closing table, your agent will likely be by your side to answer any final questions.
And once everything is finalized, your relationship with your agent doesn’t necessarily end.
“I love working with first-time homebuyers,” says Boutwell, “because I want to build that relationship long-term. You’re going to work with me for your first and hopefully the next couple of homes.”
If after you move in, you need an electrician, plumber, or another kind of specialist — ask your agent! They likely know many professionals they can refer you to. And don’t forget to invite them to the housewarming party!
Header Image Source: (Christina @ wocintechchat.com / Unsplash)
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