When You Buy a House… Make Sure You Use a Buyer’s Agent

When you start shopping for real estate, newspaper ads, signs outside of potential properties and websites all drive potential buyers to the sites and offices of listing agents.

While these agents greet buyers with broad smiles and generous, helpful attitudes, they represent the seller’s interests in getting as much as possible for their property, not a buyer’s interest.

If you are shopping around for a home to purchase, it’s a good idea to avoid the seller’s agent and find yourself a “buyer’s agent” instead. Any licensed real estate agent can broker the sale of any property that is posted on the Multiple Listing Service but not all agents represent the buyer’s interest in the deals they broker.

No matter how friendly an agent or seller is in a transaction, that agent is advocating for the best interests of the seller, not the buyer. Listing agents will happily show you numerous properties and over time, build a relationship with a serious buyer. Despite appearances, that agent still represents every seller listed in the MLS. Never forget this because they are also obligated, generally by law, to reveal any and all facts about the potential buyer to the seller. Nothing you say to them is confidential.

So, let the buyer beware, unless you seek out and find a buyer’s agent.

There are agencies that specialize in representing buyers only. In the past, a buyer could hire a representative for a fee, plus retainer to help find property, arrange financing and make an offer to a seller. Today, real estate agencies that represent buyer’s interest only abound in most parts of the country and they are paid a commission fee that has to be split between the seller’s agent and the buyer’s agent. This fee is negotiated between the two agents and is folded into the transaction.

Baltimore agent Jody Hudson says real estate laws and contracts are being rewritten in every state to allow buyers to be represented exclusively by their own agents. She says buyers are better represented in these deals and often save buyers thousands of dollars in better-negotiated deals, reduced closing costs and contract concessions these experts know enough to include in potential offers.

If you are in the market for a buyer’s agent, be sure that you ask the people you deal with to make sure you are not talking to a seller’s agent or a dual agent. In some states, dual agents are bound to be financially and legally loyal to both parties. This is often done when one agent in a firm has the listing and another agent in the same firm brings in a buyer. “Some people feel that “dual agency” is a conflict of interest,” Hudson said. Some kind of conflict of interests just seems inevitable in this arrangement.

Hudson says buyer’s agents come in two varieties, one only represents buyers. Other agents work both sides of the street in separate transactions, representing sellers in some deals, representing only buyers in other deals.

When Hudson represents a buyer, she says, “I will be your gladiator. I will do battle on your behalf, and at the expense of and against the interest of the seller and the seller’s agent.”