Is it possible to make an offer on a MLS listed property without using a selling agent? If so, what happens with the selling comm, does the listing agent get 100%?
@Paul Stephan The listing agent will then keep 100% of the commission. Also if you are going to do this, you need to be completely sure you know what you are doing and how to comply with the laws of your jurisdiction.
Frankly if it is an MLS listed property, I see zero reason why you wouldn't use an agent. They are going to be a great resource to you.
I have seen many times when a buyer thinks they will be able to get a better deal going straight through the listing agent. They think oh he is going to be incentived to sell to me at a better price since 100% of the commission is better than 50% . What happens in reality though is you have no one looking out for your interest. If the selling agent is someone who thinks like that, and puts their needs in front of their clients needs...then they are also likely to be an accomplished liar, who will steer the deal towards you, but they will also make sure you are doing something stupid in the process like over bidding, or hiding defects in the home from you.
I was really looking at it more from a direct interface with the selling agent (say I'm not happy with the response time and negotiating prowess of my realtor) but I understand the buyer's agent is working for me and the selling/listing agent is working for the buyer. And I don't think a listing agent can legally hide defects, or am I being naive?
*edit: listing agent is working for the seller.
Yes, I agree… there is zero reason not to have an agent represent you… You have someone looking out for your best interest… before I was licensed, I always had an agent representing me in all of my transactions… Not only are they working for you on that specific transaction, but if you develop a good relationship with one agent, they will keep you in mind when they come across a good deal ... Make sure you find an agent that you are comfortable with and one that truly is working for you… Not just someone looking for a quick commission.
legally, the seller must disclose any known defects… That transfers to the listing agent if the agent is aware of the defects they would put their license at risk by not ensuring that the seller discloses defects in the sellers disclosure notice .... As a practical matter, I'm sure there are agents and sellers out there who purposefully hide defects… I don't think working directly with the listing agent would change the situation – and honest agent will be honest/a dishonest agent will be dishonest .... I personally would not be involved in the transaction where I didn't have direct representation .... If you aren't happy with your agents timeliness/negotiating skills… Keep searching until you find one that is a good fit
"a good agent" Very tough to find unfortunately. Most I have come across only want to do bigger deals which equate to more $. I'd recommend getting your license.
@Paul Stephan , I agree with what @Russell Brazil said. As a buyer it makes little sense to NOT use a Realtor. The only reason would be if you simply do not want to rely on another person as a go-between. I'd think of them as a "free" assistant (no disrespect to Buyers agents!) on the transaction. The seller is usually paying all commissions so if you have a Realtor representing you then they will be handing most of the paperwork and phone calls for you.
If you're unhappy with your Realtor then you need a new investor-friendly Realtor. Otherwise, just make sure you know what your doing if you go directly to the Listing Agent.
When I make my offers without an agent (which is always), I have a contingency that I am representing myself, but if the offer is countered at all, I will get my own representation from a different agency OR the seller can only pay the listing agency commission, as their is no co-broker. Depending whether I see myself working with that listing agent/agency again or not. I don't mind if the LA gets both sides if I get my price/terms.
My first offers tend to get countered less often as a result. Funny that, right? I wouldn't recommend a new person go solo, though. A quality buyers agent is worth the little bit of discount you may receive going on your own @Paul Stephan .
Know any experienced investor friendly agents that specialize in NW Houston? :-) And I am looking at the self-licensed option. But it does take a lot of time and costs money, not to mention all the pros and cons of whether that is actually a benefit for investors.
I got the answer I was expecting, that there is no legal requirement to use an agent but every reason to do so. Thanks for the responses!
i'm all for getting your license… Nobody will represent you as well as you… assuming you will conduct enough transactions to make the cost and effort worthwhile
There's an old saying that "You don't know what you don't know." It's very true when purchasing real estate of any kind, and more so if it's for an investment purpose. As an investor-friendly realtor (who is an investor herself), I like to think of myself as your defense against making an unintentional error due to inexperience or lack of knowledge. A lot of my clients have come to me with erroneous ideas or information that I am able to set them straight about, which saves them a lot of time, money and headaches. It also often opens them up to possibilities they weren't aware they had.
Anyways, if you would like to chat more about my services and experience, please feel free to PM me @Paul Stephan . I do work in the area you mentioned.
I never use a realtor make offers on the MLS to motivated sellers. I tell them my terms, take it or leave it.
@Paul Stephan You definitely can go through the listing agent directly. You may be able to negotiate a better price since the listing agent typically would get double commission. Many agents won't want to represent you AND the seller though so you will need to check with the listing agent about that. Other agents will represent the seller only and have you sign a disclosure that you are unrepresented.
@Paul Stephan , if you need a Realtor, I can help you out. Thanks.
Having read this entire thread, I feel compelled to share this much from my own experience investing in properties under $245k in Houston: a number of realtors will not respond to, or communicate with, a buyer's agent. The listing agent takes the initial phone call and then becomes awfully hard to reach. Over the past year, I'd estimate rate of this Bad Behavior as 10-15%.
Good, really good, cash offers, delivered 8 hours after the listing goes active, receive no response for a week before the property sells to a buyer who worked with the same agent or broker. I have no proof that the seller saw the offer and no proof that the seller did not see the offer. The facts are simply presented for your consideration.
Perhaps especially in the case of modestly priced properties, some agents want that commission and apparently believe the current market will deliver (1) a non-licensed buyer without representation amenable to intermediary arrangement or (2) a buyer who is a licensed attorney seeking to represent him/herself as a principal in the transaction (Texas prohibits lawyer from taking split in commission if lawyer is principal in transaction). Take it from a licensed but non-practicing attorney who got traction on 2 mobile-phone calls made, whilst seated in buyer-agent's office, to Vanishing Listing Agent. An investor-friendly agent can be a great hedge against shenanigans, but agents come in all flavors and sizes. Please note that the conduct I describe runs afoul of rules of ethics set by the state real estate commission, is grounds for a complaint that can result in disciplinary action, and so on, and so forth, etc., etc. Just wanted to round out the otherwise excellent range of responses to the original question posted.
If you know what you are doing and know your mind on the numbers you can make an offer through the listing agent. In most states I have been in this works fine. I hate bringing in a buyers agent just to have an agent. It is an extra layer of management I don't want. All that said we know the terms that will make the deal work for us. If a deal is more complicated or brought to us by an agent we use that agent. If you are asking you probably don't have the experience and might benefit from a buyers agent to find deals. Over the years I have had two awesome agents and the rest were forgettable. The awesome agents were well worth it, not sure if they would have been critical for every transaction.
@PG Henderford From my experience what you're describing is almost certainly coming from the seller, not the listing agent. The listing agent is legally obligated to present ALL offers in a timely manner. Most likely this situation is caused because the seller wants to hold out for what they hope will be a better offer.
To avoid it I would put an expiration date in the offer. State something like "this offer will automatically terminate if not accepted by seller by ___________."
Hi Paul if you are still looking for a Realtor, I will be more than happy to assist you. I'm investor friendly and my contact information is in my profile.
I do it all the time. I disclose I am a prequalified investor . Most sellers agents will transact the deal. Only problem I experience is some realtors/agents will not speak to me since I am not a licensed agent - for whatever reason - their loss. I want to also add I know RE contracts for my state as well or better than most licensed agents. So by being able to talk the talk and walk the walk, I get taken seriously which I believe gives me an edge in working with other agents. If you don't know your local RE contracts well, consider hiring an agent or RE attorney for an hour and get educated - it will go a long way in your success !
Yes...i just did it.
@Fred Heller Done and done. I deliberately do not speak to whether the silence reflects seller or listing agent. My point goes to my preference for an accepted offer over an expired offer.
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