What Are the Dangers of Purchasing a New Home Without a Realtor?
Here are the advantages of buying a house without a real estate agent: agents might be less willing to take an offer under their asking rate simply because they padded their asking rate to accommodate agent fees. The internet has leveled the playing field for most independent home sellers who now have easy access to historical available listings data spanning back several MLS years. Agents might not be as anxious to sell a house without a real estate agent because many sellers who are seeking the same benefits that they are now get them through the internet. Also, there is no longer a need for a salesperson to represent the seller. Listing in MLS allows the seller to list the house on his own. This level of seller control gives the savvy seller the ability to make important decisions themselves and know what the market will respond to before ever having to make a business deal with a real estate professional.
Another advantage to buying a home without a real estate agent is time. The traditional method of listing a house is time consuming and requires multiple visits to local brokers. As well, listing homes in the traditional manner requires that sellers have to have a qualified buyer in place in order to close a deal. In addition to all these hassles, homeowners might not know the rules of the game and be surprised by the agent’s attempts to close a deal on their behalf.
In some cases, the agent might present a bogus offer to secure the buyer’s commitment to go through with the transaction. Online MLS services have “lenders” that do not require a mortgage broker’s commission, which can reduce the price of the house when the time comes to sell. In addition, buyers can now conduct an inspection of a home themselves before making any kind of commitment and can avoid paying outrageous real estate agent commissions to have someone else do the work. These new tools allow homeowners to save money, which can translate into more comfortable buying decisions.
Perhaps the biggest obstacle homeowners face is finding a seller who will actually go forward with the transaction. Buyers who rely on real estate agents often do not have any independent inspectors check the home for problems. These sellers are not likely to be concerned about defects or structural damage unless there is money to repair it. As a result, they may choose to foreclose on the property and pocket the difference – leaving the buyer with the unpleasant surprise of having to pay a damaged house.
Buyers beware: No matter how quickly you think you can close a deal, you may not be able to save money on closing costs by bypassing a real estate attorney and choosing to close without an inspector. Most lenders require that buyers hire an inspector and title company before they will issue the deed of trust. At this point, the lender will require a buyer to sign a contract agreeing to pay for all expenses related to the property, including attorney fees and real estate inspections. The contract will also cover taxes and bonding, if required. If the seller does not agree to these terms, he could lose the house because he did not submit the right documents to the lender.
In many cases, buyers cannot find homes in this way without help from an expert in the field. In fact, many buyers consider a contract or a deed of trust the beginning of the real estate transaction and cannot afford to ignore professional advice. A Realtor can make buying a new or used home much easier by suggesting financing options, explaining options for securing mortgages, and discussing the ins and outs of closing costs. Buyers without an active real estate agent may not even be aware of many of these things. When a buyer is considering finding homes without an agent, finding a Realtor is probably the best idea.
Besides the difficulties of finding homes without real estate agents, there are other serious dangers that can be associated with buying without a realtor. There are laws that must be followed, such as ones that deal with the transfer of ownership and closing costs. Many buyers do not have a true understanding of these things, so it is very easy to accidentally violate them. Even if one does not violate the law, it is usually against the wishes of the seller to break the law and cause further delay in the process of buying a new home.
In conclusion, finding homes without a realtor can often be a good first step. Buying a new home can be overwhelming for someone who is inexperienced and has no idea what they are doing. This first step can save the buyer a great deal of time and money, and can even lead to a successful transaction.