Chicago, IL · Member since 2018 · 90 posts · 37 votes
Hello,
I am pre-approved for a mortgage and two days ago I walked through (with the listing agent) a 30K two flat that I am interested in. This is my first time buying a home, and I have a home inspector that I will work with to assess what needs to be done. I know that it will need a ton of work and that's fine, but what kind of agent do I need to make an offer? A friend of the family is going to help me, but I don't know if she has experience with distressed properties.
@Jay Garrison from what you just described, I would say you desperately need an experienced agent. Many people mistakenly think that the agent is just there to open the door and collect a check. If you are working with the right agent, they can guide you through re-positioning a property. You need to know the future value of the property (ARV), you need to know rental comps, you need to know current value of the property, you need a good attorney referral, and you need contractor referrals along the way.
As @Sam Valme said, you aren't even going to pay a buyer's agent. The sellers will! Which part of Chicago are you buying in? Due to the purchase price, it sounds like it is probably the south side. You should connect with @Ronan M.
I’ll let someone else really breakdown ALL of the benefits of using an agent as a buyer lol. In short - Yes. It doesn’t cost you anything and they’ll help you navigate a lot of red tape and potential issues. :)
@Jay Garrison from what you just described, I would say you desperately need an experienced agent. Many people mistakenly think that the agent is just there to open the door and collect a check. If you are working with the right agent, they can guide you through re-positioning a property. You need to know the future value of the property (ARV), you need to know rental comps, you need to know current value of the property, you need a good attorney referral, and you need contractor referrals along the way.
As @Sam Valme said, you aren't even going to pay a buyer's agent. The sellers will! Which part of Chicago are you buying in? Due to the purchase price, it sounds like it is probably the south side. You should connect with @Ronan M.
Jay Garrison you don't technically need an agent and if you don't use one in this scenario, I would guess the listing agent would take all the commission to try to represent you and the seller.
I 100% agree with the advice John Warren provided since you are new. Good luck.
You absolutely need an agent. The first they'll point out to you is it doesn't sound like this property will qualify for your financing....you need to have that discussion with your lender..they can give you some guidelines. The only way you'll finance something like this is a 203k or similar, finance purchase plus reno(which you can't do yourself) and you wont get any loan for less thn %50k.
@Jay Garrison if this property is on the Southside let me know if I can help. I own property on the Southside and I am a licensed RE agent with Second City Real Estate. If you are aware going in to the deal that the property requires work do also check for any City violations that are common with property in that price range.
City violations (and permits if required) might add a significant amount of time and money to your rehab project.
@Jay Garrison I could not agree with @John Warren more. As an attorney, I work with Buyer's in these types of scenarios from time to time. Typically, a Buyer will go directly to the Seller's agent hoping that since he/she is going through the same agent, he/she (the Buyer) will receive some type of discount since the Seller is saving on commission. This may or may not be true, as we don't know whether the Seller's agent will take the Buyer side commission or waive it. What you lose is an advocate. The Seller's agent knew the Seller ahead of time and has developed a working relationship with the Seller. There is an old saying in law that "A servant cannot serve two masters". It would be difficult to see how there would not be a conflict of interest for that agent.
You indicated that you are a new buyer. That being the case, I would recommend you go with an agent who is keenly familiar with the area.