Here’s Why You Still Need an Agent
Let’s say you’re selling your house, and before you even get a chance to snap listing photos and put it on the market, a buyer comes along. Perhaps the buyer makes you an offer you just can’t refuse. Congratulations, you just cut out many steps of the home-selling process—showings, open houses, and haggling over price.
With an offer in hand, you might be asking what commission an agent would receive ifthe agent were to get involved at this stage of the home-selling process, but keep in mind what may seem likea straightforward transaction between a seller and buyer once an offer is accepted, it’s usually not that simple at all. You still have a marathon to finish before getting to the closing table. I’ve broken down the home-selling process into steps so you can see what an agent could help you with.
Neither federal nor state laws govern commission rates, which means commissions are fully negotiable. Negotiating the commission is between you and your agent.
To crunch some general numbers, if a home sells for $250,000 at a 6% commission, the seller’s agent would get $15,000 right? It’s not that simple.
How agents are paid varies by state and brokerage, but in most cases ~ such as what we typically see in Georgia ~ your agent’s broker will be paid a percentage, the buyer broker must be paid a percentage, the buyer’s agent will be paid a percentage, and if your agent is on a team, another percentage may be paid to the team. Always talk with agents about your particular home-selling needs. Find out if and how they would want to handle the sale to a buyer found by the seller.
In this scenario, a buyer made you an offer and you accepted. However, it’s time to take a step back: Keep in mind verbal offers are not legally binding in real estate transactions. Agents supply a variety of forms such as residential Purchase and Sale Agreements, Seller’s Property Disclosure Statements and various exhibits to get offers in writing. These forms vary to conform to state and local laws, and eventually become a binding sales contract. It’s essential that an offer contains every element needed to serve as a blueprint for the final sale.
An agent can also handle a buyer’s earnest money—usually 1% to 2% of the home’s purchase price—by depositing it in an escrow account held by a third party such as a real estate attorney, a real estate broker, or a title company (depending on the state you’re in). Remember, escrow protects sellers. You get to keep that money if a buyer bails on a transaction outside the terms stipulated in the contract.
The terms of the sale and contingencies
While it may seem the hard part is over if a seller found a buyer on their own, many obstacles can occur during the contract period that will require an agent’s skill to keep the deal together. For instance, an agent will ask if you and your buyer agree on not just the sales price but also the terms of the sale. Terms within a purchase agreement include basic information such as the names of the parties involved, the legal description of the property to be transferred, and the agreed-upon price. But terms also list crucial details such as what personal property will be included in the sale (e.g., appliances or fixtures). Leaving any terms of sale out of the purchase agreement can come back to haunt the buyer, the seller, or both.
An agent will also ensure contingencies are added to your contract. Standard contingencies include a buyer securing financing, a home inspection, repairs, and an appraisal—which is crucial to the mortgage process.
Furthermore, just because a buyer presents an offer, how will you know whether that buyer can follow through with the sale? Never ever take someone’s word for it. A great agent knows what must be provided with the offer to substantiate whether the buyer has the funds, where it will come from and how it will be provided.
Remember, you need multiple legal documents for the closing, including a clean title. This step is usually done by an attorney who collects a fee at the closing, but a real estate agent handles the many steps it takes to get you from a binding agreement to the actual closing table. This includes but definitely is not limited to: negotiating on your behalf to make sure you get the best offer possible, providing all pertinent information as required by law, coordinating with appraiser and inspectors, setting a date, assisting in coordinating repairs, coordinating everyone’s schedule, communicating with the closing attorney (or title company), paralegals, and ensuring all the needed paperwork (which is a mound of documents), is ready and correctly signed.
Other important benefits of using an agent
Who has time 24/7 to take calls and requests for home tours/showings? An agent can handle it all and provide you with protection buy installing a lock box on your home which electronically tracks and allows/disallows access to your home. Not only that, they handle who comes and who goes at all times per your direction AND they can follow up with buyers and realtors on feedback from showings.
A great realtor will know how to strategically market your home through various methods and provide professional photography of your home which are ABSOLUTELY PARAMOUNT to selling your home! Having access to reports of online activity around your home listing is a huge benefit so you know what’s working well. I could go on and on…:)
The bottom line
When a real estate professional assists you, their compensation is a matter of negotiation between you and the agent. Hiring an agent coordinate your listing, to write the offer and guide it and YOU toward a successful closing table can make the difference in a slam-dunk and a fail. If you’re considering selling your home, let’s connect! My motto: Your Home. Your Memories. My Focus.