BUYER’S MYTH: I’LL GET A BETTER DEAL IF I CALL THE LISTING AGENT
I hear it many times, “We’ll get a better deal if we work with the Frederick listing agent because he/she can give up a portion of their commission.” Since I hear it so often, I’d like to address it in this post. The answer to that assumption is…maybe…maybe not.
The listing agent is hired and contracted by the seller. Their commission is negotiated upfront. Then the listing agent agrees to share that commission with any cooperating agents when the property is marketed on the local MLS (Multiple Listing System).
If the listing agent sells the house themselves, they are under no obligation to change the amount they have negotiated with the seller. That is between themselves and the seller. If the listing agent sells the home to a buyer, they have twice the amount of work to do to shepherd the deal to settlement.
Now, like any other business person, making a concession is the choice of any real estate agent. It might be the best business decision to make. Sometimes its better to help out and make the transaction successful than to see the entire deal fall apart. But that is a business decision that an agent may or may not make. To assume something like that upfront isn’t a good idea.
A Buyer’s Agent Is The Best Choice
The main reason why this assumption is not a good one, comes to an issue of representation. The listing agent represents the seller, which means they represent the seller’s best interest. It is a legal and fiduciary responsibility, made by contract. If you don’t have a buyer’s agent, you don’t have representation.
In the case that anything goes wrong in a home inspection or in any of the negotiations, the listing agent works for the best interest of the seller, not for you, the buyer. You could very well end up in a situation that nets you a greater loss than the 1% or so you might think you are saving without a buyer’s agent.
New Home Construction
One of the biggest misconceptions is that you save money by not using a buyer’s agent when you are dealing with New Home Construction. The X% commissions are built into the deal, it is already a cost of doing business for the builder. So if you don’t have a buyer’s agent with you, the selling agent(s) are paid the entire X%. You also could be better off with a buyer’s agent to negotiate on your behalf when dealing with new home construction.
If you are looking to buy a home in Frederick or Central Maryland, Contact Us and ask about our buyer representation… we’d love to help you make Frederick home.
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