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Buying A House Without A Real Estate Agent: Should You Do It?

6-Minute Read
Published on July 14, 2021
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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 an experienced real estate agent when you purchase a home.

From valuable 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 an agent.

Do You Need A REALTOR® To Buy A House?

First, a quick lesson in terminology. A REALTOR® is an individual who represents you in the home buying process. While the term “realtor” is often used colloquially in a way that implies it has the same meaning as the term “real estate agent,” there is a small difference between the two. All real estate agents must be licensed and are all held to a strict code of ethics. REALTORS® are simply real estate professionals who are members of the National Association of REALTORS®.

This does not mean that REALTORS® are better or more qualified than regular real estate agents; it just means that they’ve joined a broader network of real estate professionals.

REALTORS® and real estate agents alike 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, home 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 have access to neighborhood knowledge including comparable sales, local history and neighborhood demographics. They should also be knowledgeable about the current market and set realistic expectations for your home buying timeline and price point.

Working With Buyer’s Agents Vs. Seller’s Agents

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, also referred to as a listing agent, has a fiduciary duty (legally mandated obligation) to the seller.

Oftentimes, they can declare 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 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

Despite the perks of working with an agent, purchasing a new home doesn’t require the assistance of one. You will be able to view homes, attend open houses and complete your purchase without the company or assistance of a real estate agent or REALTOR®.

Forgoing a partnership with a real estate agent 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.

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 real estate agent 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, your agent 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 an agent 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 an agent, 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. Your agent 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 an agent, there are still a few downsides.

  1. You will have to pay a commission. Hiring a full-service real estate agent 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.  Real estate agents make money when they sell houses. Therefore, they may have numerous clients that thinly spreads their time. You need to be sure your agent 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 agent can meet your standards and conduct business within an appropriate period of time.
  4. Agents are not lawyers or home appraisers. Real estate agents 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 an agent 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 House Without A Real Estate Agent

If you choose to buy a home without a real estate agent or REALTOR®, you should do your research and prepare as much as possible. Here are ten important steps to take before entering the home buying process:

  1. Prepare your mortgage documentation well in advance. Here’s a list of the documents you’ll need when applying for a mortgage. You’ll want to start by getting a mortgage preapproval, as it can help streamline the home buying process, and 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 be rejected or 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. However, getting an understanding of how much homes are selling for in the area where you’re interested in buying property will make it easier for you to navigate the market without encountering any unpleasant surprises with regard to house prices.
  3. Get familiar with the neighborhood. You should make an effort to gain a sense of local crime rates, school statistics, property development and anything that would sway the purchase of your home.
  4. Build contingencies into your offer. You want to make sure you have a way to cancel the contract without losing your earnest money 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. Be sure 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. Be ready to negotiate. There’s a lot more at stake when negotiating the price of your home. You’ll 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 disclosures. It’s required by law in many states that sellers provide documentation disclosing any issues with the property you’re looking to purchase. If you don’t know what to ask for, they may not share all the information you need.
  10. Prepare a list of questions to ask the seller prior to the sale of the home. Don’t hesitate to ask about things like their reason for selling, how much they paid for the home when they first purchased it or whether there were any previous issues with the property that were addressed in the time that they lived there.

The Bottom Line

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

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

Ready to begin your home buying journey? Talk to an expert at Rocket Mortgage for assistance in getting started today!

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Victoria Araj

Victoria Araj is a Section Editor for Rocket Mortgage and held roles in mortgage banking, public relations and more in her 15+ years with the company. She holds a bachelor’s degree in journalism with an emphasis in political science from Michigan State University, and a master’s degree in public administration from the University of Michigan.