10 Things Your Real Estate Broker Won’t Tell You
I have recently begun the search for my first home so I can capitalize on the $8,000 first time home buyer tax credit. The $8,000 tax credit, which expires at the end of this November, is a great incentive for new home ownership (more info here). And while I already have my real estate broker lined up (thanks bro) I found this list very interesting.
A part of me thinks, “does this stuff really actually happen?” Upon further reflection I’ve come to the conclusion that the answer is absolutely yes, and also happens in every other industry where money is to be made (duh)! 10 things your real estate broker won’t tell you from SmartMoney below (shortened for length):
1. “Open houses only have a success rate of 2 to 4%”. Your real estate broker is more interested in networking and meeting new prospect clients than actually trying to sell your home.
2. “My fees are negotiable.” Just make sure you ask of course. Note though this may indirectly induce behavior to cheat you later in other ways (keep reading).
3. “You’ve actually had offers. I just never told you.” Legally brokers are supposed to tell you about all offers, but sometimes ignoring a lower bid or waiting for one of their own clients to walk through (which would give them the full 6% commission) is more important.
4. “I don’t have to your personal information to myself.” Find a house, call the broker listed, walk through, then make an offer. Well if you tell that agent you can afford $300,000 but only want to offer $250,000, chances are the seller is going to find out. Also, make sure to keep your mortgage pre-approval number close to your offer price.
5. “Sometimes I may not always be on your side.” Brokerages offer incentives to agents who can sell in-house listings and furthermore in the end some agents just want the house sold, so be careful of the sweet talk that your agent is giving you to “just go for it”.
6. “I am not a zoning expert.” No every broker knows about zoning laws so if you are buying bigger land and have some creative ideas make sure to run them by an expert first, then your agent.
7. “Termites won’t kill this deal.” Make sure your inspector is not too “buddy buddy” with the broker. While it is the inspectors job to find any and all flaws sometimes they don’t get told to you.
8. “I am not a lawyer.” In the case that you close but end up wanting to lease the house to the seller for one more month until you move in, make sure a legal document is written up by an actual professional. Otherwise your house can be trashed and you are stuck with the extra cleaning bill.
9. “My website isn’t really helpful.” Don’t use the brokers website exclusively to look for potential houses.
10. “Selling by yourself isn’t as hard as it sounds.” 20 – 25% of homeowners sell their own houses each year. You can hire an independent appraiser for $200 to tell you what you should try and sell for.
Enjoy the article? This “10 things that x” piece is part of a huge collection of articles making up a brand new book, 1001 Things They Won’t Tell You: An Insiders Guide to Spending, Saving, and Living Wisely (purchase from Amazon.com).
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