Purchasing a home is typically the most expensive investment most people make. It is a big decision fraught with legal paperwork. A poor home choice can cost you big time – a house with hidden problems, paying more than you need to, problems with resale value later.
Below are 5 common mistakes inexperienced home buyers make when choosing a real estate agent to help them with their home purchase:
1. Contact a friend or family member who you “heard” was an agent
This can be a hit or miss proposition. There are literally thousands of real estate agents in the Oklahoma City metro area. Only a fraction of those actually work full time as a Realtor and an even smaller fraction have the experience necessary to make your home buying process easy and pain free. Make sure the agent you choose has a valid web site, provides you with plenty of information on the home buying process, is actually a licensed Realtor, and works with a reputable broker from a major company.
2. Call the agent on the yard sign about a home
This is a very common mistake inexperienced home buyers make. The agent on the sign is actually working for and is paid by the home seller. Sure, they can help you purchase the home, but their #1 job is to sell that home. While most Realtors are ethical and per our Code of Ethics treats everyone in a transaction fairly, you are still better off having your OWN Realtor who represents YOU in the transaction. The good news is the seller pays our fee through the listing Realtor so it doesn’t cost you any money.
3. Assume all real estate agents are Realtors
The word Realtor is trademarked by the National Association of Realtors (NAR). Members of NAR must agree to a strict code of ethics and are governed by rules that demand fairness to all parties. Agents in Oklahoma do not have to be members of NAR to sell real estate in Oklahoma, and hence may not be held to the same ethical standards of conduct.
4. Assume you have to pay a fee to be represented by a Realtor
The Oklahoma City Multiple Listing Service is run by Realtors in the OKC metro area under a cooperative agreement between all parties. Every Realtor who participates agrees to share the fee charged to the home seller. The fee is split between the Listing Realtor (the one who represents the seller) and the Selling Realtor (the one that represents YOU in the transaction). Hence, as a selling Realtor, my fee is paid by the home seller, yet my job is to represent you, the buyer. The listing Realtor’s job is to represent the seller. Hence, each party in the transaction is represented fairly. The home seller pays the listing fee, which is split between the Realtors involved, and YOU the buyer don’t have to pay any fees in most cases.
5. Shopping for a house before a mortgage
It is more fun to look at homes than it is to talk to mortgage lenders and make sure your finances are in place. But it really is a waste of time and effort to look at any homes prior to getting pre-approved for a home loan. If you by chance run across the “perfect” home, sellers won’t even consider an offer until they know you are qualified to purchase the home. The delay while waiting on an approval can mean the hot property you want becomes someone else’s perfect home.
Talk to a lender first before looking at homes. If you don’t already have a lender, I can get you in contact with several lenders I have worked with in the past. They can help you navigate the complex waters of home mortgages, provide you advice on repairing any questionable credit so that you get the lowest interest rate, and help ensure that once you find the “perfect” home you are in a good position to close quickly.