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Should You Buy A Home Without A Real Estate Agent? Your Questions Answered

6-Minute Read
Published on August 5, 2019

Whether you’re a first-time home buyer or a seasoned homeowner who’s been around the home buying and selling block a few times, it’s always a good idea to work with a real estate agent when you purchase a home.

From their expertise to their ability to stick to a deadline, there are many reasons why you should hire a real estate agent.

When almost everything is accessible online, it can be easy to adopt a false confidence that encourages you to handle it all yourself. After all, you can research listings online and plot your path to check out the homes that interest you.

For the purposes of narrowing your search, those techniques are perfectly fine. However, there are certain stages during the home buying process when you may want someone in your corner.

Here’s what you need to know about working with a realtor.

When You Should Consider Working with a Realtor

A real estate agent is an individual who represents you in the home buying process. Your realtor will set up home viewings on your behalf, give you information on houses that pique your interest and help you negotiate the best price on the home you would like to purchase.

Additionally, they provide references for reputable lenders, inspectors and other service providers that you’ll need during the home buying process.

While you might find independence is possible during the online house hunting process, once you’re ready to walk through a house you’re interested in, you may want an agent at your side.

A good real estate agent will also have access to neighborhood knowledge including comparable sales, local history and neighborhood demographics.

They should be knowledgeable about the current market and set realistic expectations for your home buying timeline and price point.

Generally, the buyer and seller may have representation from separate agents.

You can choose to use the seller’s agent; however, they may not have your best interest in mind. A seller’s agent has a fiduciary duty to the seller.

Oftentimes, they can claim dual agency, meaning they claim to represent both seller and buyer in a home transaction. However, at the end of the day, their primary duty is to the seller. For this reason, it’s wise to hire your own agent to represent your interests in the transaction.

A buyer’s agent, on the other hand, will have fiduciary duty (legally mandated obligation) to you, the home buyer.

This means they have a responsibility to act in your best interest, making sure your private information is confidential and accounting for all documents and funds in the home transaction.

When You Should Consider Purchasing a Home Without a Real Estate Agent

Purchasing a new home doesn’t require the assistance of a real estate agent. You can complete the purchase without the help of a realtor. You will be able to view homes and attend open houses without the company of a realtor.

Forgoing a partnership with a realtor can save you a significant amount of money. You can expect to save at least 6% of the purchase price of your home between buyer and seller agent’s commissions.

Additionally, you may be able to find all property information online without additional help. With the rise of technology, you can access most property data in seconds.

If you feel confident you can find everything you need on your own, you may not need the expertise of a real estate agent.

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Pros of Working with a Real Estate Agent

Even if you’re tempted to work alone when buying or selling your home, there are some benefits when working with a realtor you should consider.

  1. They’re experts in the industry. Most real estate agents have a wealth of knowledge and expertise that can help you navigate the home buying process. If you’re a first-time home buyer, a realtor can offer helpful tips to make the process as simple as possible.
  2. They can save you a lot of time and energy. With all of your daily responsibilities, it may be challenging to juggle the sale or purchase of a home. Having a realtor by your side can add a level of convenience when making one of the biggest purchases of your life. Real estate agents can also save you time by gathering marketing materials, holding open houses and searching for homes that fit your criteria.
  3. They can calm your nerves. If you choose to buy a home without a realtor, you will need to handle all the listing communication. Delayed responses to potential buyers can deter their interest in your property. Another important component of buying or selling a home is the paperwork involved. If you miss something, it will delay the process. Realtors can help you manage all listing communication and paperwork. This may limit your stress and give you peace of mind.
  4. They act as middlemen and help with negotiations. You might have questions and concerns about a home before you put in an offer. A real estate agent can express your concerns to sellers, without insulting them, by acting as a neutral party in the buying process. Your agent can convey these concerns appropriately and negotiate the best price for you.

Cons of Working with a Real Estate Agent

Although there are many positives to working with a realtor, there are still a few downsides.

  1. You will have to pay a commission. Hiring a full-service realtor can be pricey. You should expect to pay an average of 6% of the total sale price.
  2. You may be one of many clients. Realtors make money when they sell houses. Therefore, they may have numerous clients that thinly spreads their time. You need to be sure your realtor will do their due diligence during every step of the buying process.
  3. You may find yourself working within their time restraints. Most likely you have your own goals and timeframe for purchasing a home. You want to ensure your realtor can meet your standards and conduct business within an appropriate period of time.
  4. Realtors are not lawyers or home appraisers. Realtors can give recommendations for the price tag on your home, but you will still need to hire an appraiser. Additionally, you may still want to get your lawyer involved to review the legality of the documentation.

Half the battle of working with a realtor is finding the right one. Unfortunately, many consumers don’t realize they have selected the wrong agent until it’s too late.

Real estate agents can add a lot of value to the home buying process if you select the right one to match your needs. Making a poor choice could cost you time and money.

How to Buy a Home Without a Realtor

If you choose to buy a home without a realtor, do your research and prepare as much as possible. The more prepared you are the easier the home buying process will be.

  1. Prepare your mortgage documentation well in advance. Here is a list of what you will need when applying for a mortgage. Getting preapproved for a mortgage will help streamline the home buying process. Preapproval may even help you get in the good graces of the sellers. You can place an offer on a home without a preapproval, but it may slow the process down and increase your chances of not getting the home of your dreams.
  2. Research recent home sales in your neighborhood. Current listings are not indicative of actual value.
  3. Get familiar with the neighborhood. You will want to understand crime rates, school statistics, property development and anything that would sway the purchase of your home.
  4. In order to avoid losing your earnest money, build contingencies into your offer. You want to make sure you have a way to cancel the contract if something goes wrong in the purchasing process.
  5. Hire a home inspector. It’s best to ask for recommendations from friends and family.
  6. Hire a real estate attorney. A real estate attorney can review your contract and provide legal advice. You can expect to pay anywhere from $200 – $500 for their time.
  7. Ensure to purchase a title insurance policy. You can ask the seller to purchase this as part of your contract. This should help clean the title from any liens or hindrances.
  8. You will need to put your negotiation pants on. There is a lot more at stake when negotiating the price of your home. You will want to get familiar with the best negotiation tactics and what’s appropriate when negotiating the sale of your new home. Be sure to establish who should pay closing costs. You don’t want to get stuck with the expense without agreeing to it.
  9. Request seller disclosers. It’s required by law that sellers provide all seller disclosures. If you don’t know what to ask for they may not provide all the information you need.
  10. You will also want to prepare a list of questions to ask the seller prior to the sale of the home. Here are a few questions you should consider.

Buying a home without a realtor is a big task, especially if you’re unexperienced. If you want to get the best deal on your home, it may be wise to partner with a suitable realtor.

If you decide you need a realtor during the home buying process, make sure to vet all eligible candidates. All realtors are not one and the same. They all have different experience levels and expertise.

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Call our Home Loans Experts at (800) 251-9080 to begin your mortgage application, or apply online to review your loan options.

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