8 Things Your Real Estate Broker will Never Reveal
Do you believe that the relationship between you and your real estate agent is based on trust and understanding? Think again.
Real estate agents are thought to be almost indispensable for property transactions. While you may assume that your property is in safe hands, there could be conflicting interests you’re unaware of.
Be cautious of the following 8 things your broker might well be concealing:
1. My Interest Takes Precedence over Yours
Real estate brokers may let you believe that they are working in your best interest but that is usually not true. They might make you believe that organizing an open house is the best way to tap potential buyers for your house. But it has been observed that its success rate is as low as 4 percent.
An open house does serve another important purpose. Holding such meets allows your broker to build contacts with prospective clients.
If you are the buyer, then be a little more alert. Though brokers are supposed to work for the buyer, helping him strike the best deal without pitfalls, most of them represent companies that work for the seller. These brokerage companies offer a commission to the brokers who, obviously, just want the house sold for their cut.
2. Do Not Reveal Everything to Me
You might come across your dream house and call the broker listed on the sale sign to facilitate the deal. Since most brokers represent the seller to help him get the best price for his home, do not get loosed lip while dealing with him.
If you tell your broker that you can afford to pay $450,000 but want to pay $400,000, he is likely to pass on the information to the seller. Do not forget: the higher price you pay for the house, more the broker earns as commission.
3. The House is Falling but I Won’t Let that Mar the Deal
If you think that buying a house is the best bet to double your investment value over the next five years, wake up; the times have changed. So do not get lured when your broker says that buying the house is a great investment.
Further do not expect the broker to tell you that the house has a leaky basement, or there are termites residing etc. Get a home inspection before striking the deal and ensure that the home inspector is not in a secret alliance with your agent.
4. I am Not an Expert
The broker’s is a profession that does not necessitate any education. He could tell you the ways to upgrade the property that you buy, like removing trees to get a better view or fixing up a dilapidated house etc., but most of the brokers do not have any knowledge of laws related to zoning. Find out from the local zoning commission as to what you can or cannot do with the property that you plan to buy.
Even if the deal is sealed, the possession does not happen immediately. In the process there are certain documents required from the broker. If the clauses are worded improperly one party may take advantage of the other. Do get the document reviewed by your lawyer.
5. You Cannot Prosecute Me
Most brokerage firms work under Financial Industry Regulatory Authority (FINRA). Any dispute arising between you and your broker is settled here and not in court. If your broker cheats on you, it is difficult to win damages in brokerage arbitration.
6. My Fees is Flexible
In the past few years, there has been a proliferation of brokers. Though the broker may make you feel that his commission is not negotiable, that is not true. Since there is a lot of competition for listings, brokers do lower their fees to increase their client base.
Further, in the wake of property prices falling, there is a chance of getting a good deal at a low commission charge.
7.You Think You Had No Offers, Actually There Were Many
The broker you hire to facilitate sale should tell you all the offers from the prospective buyers, but they do not always do so. They might feel that the offer price is too low to earn them a fat commission.
8. My Service is not Indispensable as You Think
Brokers tends to make you believe that selling or buying a house is difficult and best left to professional. It is not complicated as it might seem. If you properly advertise your house and fix the right price, you will immediately find buyers.
Get the property appraisal done to know the exact value of your house.
These tips will surely help you know your agent better, and ensure that you seal the best property deals.