Why contract with a buyer’s agent?
Many home buyers have no clue why they should contract with a buyer’s agent prior to looking for a home, but it should be obvious when you ask a simple question: Who’s working for you? Whether you’re buying Illinois real estate or Texas ranch land, if you don’t have a buyer’s agent under contract, the answer is a resounding “No one!”
You see, in every real estate transaction, there are two sides to the deal. There is the buyer’s side and the sellers side of the exchange, and the two have sometimes opposing interests. It’s in the buyer’s interest to get as low a price as the market will bear, and it’s in the seller’s interest to get as high a price as the market will bear.
Few agents will turn down a chance to “double end” a deal and work both sides of the transaction, and there is nothing unethical about it as long as the proper legal disclosures are made. This arrangement does have one big benefit when either the buyer or seller is extremely motivated: So is the agent. Since he won’t get paid unless the deal goes through, you can count on a double-ending agent to work extra hard to smooth out disagreements and keep the transaction on the table.
On the other hand, when disagreements come, an agent in a double-ended deal is put in an awkward position of being able to side with no one. He sites squarely in the middle, unable to advocate forcefully for either side.
By contrast, when the buyer and seller each have separate agents, they act as counterparties in the deal, and can advocate forcefully for the best interests of their respective clients. When it comes to price negotiation for that Texas ranch, the buyer’s agent should give honest and frank advice about property values to keep her client from overpaying. The seller’s agent should naturally seek to protect his client by attempting to negotiate the best price and terms possible.
Protect your investment. It is usually best to contract with an experienced buyer’s agent who can negotiation vigorously for you.
