Should I Use a Friend as My Agent?
February 3, 2017
Our first home buying experience is what motivated Tara and I to get into real estate many years ago. Unfortunately, it was not because the experience was so great, however we quickly learned the industry was fraught with opportunity. Over the next several posts I am going to share with you my advice, thoughts, and experience on various components of the real estate transaction. While this is mostly geared toward someone unfamiliar with how buying and selling real estate works, the principles can be applied to everyone, regardless of experience level. The topics we’ll be covering are:
Agent: “Should I Use a Friend As My Agent?”
Lending: “Eliminating The Uncertainty When Financing Your Next Home”
Down Payment: “What do you have?”
House: “Price isn’t Everything”
Inspections: “What Inspections???”
Closing: “You need me to sign ANOTHER document?”
So you have a personal friend, family friend, or family member who is a real estate agent? Let me let you in on a secret; it doesn’t mean they are qualified to guide and protect you through what is likely the largest financial transaction of your life. If you search Google right now for questions to interview an agent, not one of them would be: Are you a friend, family member or a friend of a family member. You know why? Well hopefully you would already know the answer, but also because it is not a valid qualification. It may get him/her in the door for an interview to be your agent, but don’t make it your reason to use them. Here is a few things to look for:
Experience: Do they work mostly with Buyers or Sellers? There is a difference. It takes a different skill set to list and market a home than in does to navigate the ins-and-outs of purchasing a home. How many buyer transactions did he close in the last 12 months? This question is about quantifying their experience. If she does not personally have experience, real experience, is she connected with someone who does have experience to lean on? Every agent was new at some point, so if they do not have the experience directly, who do they partner with? Realtors are not required to have any practical training before marketing their services. Generally, it is the broker’s responsibility to ensure they’re practicing in a lawful and ethical manner, however many brokerages offer little to no training to their agents. Never risk your financial well-being on someone figuring things out as they go.
Negotiating: Negotiations don’t end after a contract is signed by both parties. A home purchase has a lot of moving parts to it. A great agent knows this and doesn’t stop working for you, even after closing. Like a great coach, an experienced agent can guide you in making great decisions, handling issues, and getting you more than just a great price on a home.
Do They Really Work: Only in the world of Real Estate do I see buyers trust a decision that amounts to hundreds of thousands of dollars to an agent who works real estate part-time. Would you ask a part-time investor how to invest $200,000? Or would you look for the investor who is truly lives and breathes his/her craft and WORKS the investment market on a full time basis? Here is a great question to ask a potential agent you won’t find on many agent interview questionnaires: Tell me about your average work week? The answer will let you know where their priorities are and how much time you can expect them to spend on your home.
Are You Ok with Losing the Relationship?: Real estate is complicated and stressful. Are you prepared to lose a friend or valued relationship over buying a house? It’s certain to temporarily upset them if you use a different agent, but transactions can be full of fiery negotiations and potential lawsuits sure to put any relationship on rocky ground. Having a tough, but honest conversation with them in the beginning could mean avoiding a long and messy breakup down the road.
Next we’ll be discussing what to avoid when choosing a mortgage lender. Who you select can often mean the difference in closing on-time or losing your dream home.
WE LOVE REAL ESTATE.