Buyer representation is free- Why are you not using it?
Every day I am observing. Examining the world, and the people around me. I am looking for habits or systems that will create success, but I am also looking for those things that are creating failure, or have the potential to lead to failure.
As I am perusing the BP forums, I have noticed that a lot of individuals think that working with a listing agent on a purchase is enough to safeguard their interests. They seem to not even think twice about it.
Let me dispell that myth right now. If you are working with a listing agent as a buyer, your interests are not represented entirely, and you're probably not going to get the best deal.
To understand why you should avoid working with a listing agent as a buyer you have to know the basics of what is happening when you sign on the line with them.
When you agree to work with the listing agent in writing, they become a Dual Agent. This means they now legally represent the seller and the buyer. All parties must agree to this in writing.
Once the paperwork has been signed the agent now owes certain duties to each client, you will hear this referred to as "fiduciary duty."
In short, it's putting the client best interests before anything else so that the client will get the best possible outcome in a transaction.
An example would be negotiating the lowest possible price, despite the fact that a lower price means a lower commission for the agent.
Do you see the issues that come up with fiduciary duty and a dual agent?
The Listing agent now has tied hands. They will not be able to represent one client entirely without violating the trust of the other. I feel the only person that benefits in this transaction is the agent because they will be getting the full commission instead of splitting it with the buyer agent.
The money for buyer representation will be paid whether you, as the buyer, utilize it or not.
If you are a new investor contemplating a purchase, get out there and find a buyers agent that understands your investing goals. You will be able to secure better outcomes in your transactions by using a resource that costs you 0.0 dollars.
As always I try to keep my posts short, simple, and easy to digest, If you have any further questions, need some advice, or simply just want to introduce yourself, do not hesitate to reach out.