home buying

Home Buying 101: Step 3 - Set Your Criteria & Plan

Home Buying 101: Step 3 - Set Your Criteria & Plan

 home is more than a number of bedrooms and bathrooms. We find that it is more important to get to know you, listen to you, learn how you live, and what understand your expectations will be in your new home. Anyone can find a house. We find your HOME. As if we were going to build your home from scratch, we will build a home on paper and will talk about the flow of your day and how you live life. 

Home Buying 101: Step 2 - Meet Your Agent!

It is important for you to have all the right information before making your decision. I have compiled a list of great "interview questions" for you to ask your potential buyer's agent. These questions are a good starting place to get to know them and will inform you about their professional expertise.

[As I hear of more good questions, I will update this list]

Q. Are you a full time agent? How many clients are you working with now? How many clients have you served this year?

An active, full-time agent is more likely to be up-to-date on the market and the law. They also have the experience of pervious transactions and have probably been though some highly unlikely scenarios. They will have a plan in place and will know what to do if things do not go according to plan!

Q. Have you worked with buyers and sellers in my target area or city?

You want an agent who is familiar with the current market in the area you are searching. For large cities, you may want to find an agent working the in specific neighborhood. In Arkansas, most agents work a variety of neighborhoods and cities, but they should have some knowledge and expertise in your area.

Q. When clients are unhappy with your service, what has gone wrong? 

Every agent has had a bad experience with a client. This question will help you to understand who they are and how they operate. Look for an honest answer here.

Q. Has a client ever filed a complaint against you? 

Hard question to ask, but you need to know. We are talking about one of your largest investments here! If you don't feel comfortable asking, check with the commission.

Q. What's your fee? 

Some agents don't have any additional charges. Some agents charge up front fees & some charge an additional percent or two and charge it back to the seller. In central Arkansas, the listing broker typically splits the commission with the buyers agent. Most great buyers agents do not look at the commission offered to the agent when showing homes. Our primary goal is serving YOU and finding the right home for you.

Q. What services are provided?

This is where you find out everything they do to work for you in the process of finding, negotiating, and purchasing your home.

Q. When am I committed to working with you? 

Don't start touring homes until you know who you are working with and they know what you are looking for.

Q. Have you handled short-sales or foreclosures?

Distressed properties can be great deals, but the paperwork is complicated, and your liability is greater. The best agents have experience closing deals with banks.

Q. Who else will be working with me?

An agent is often supported by a team. But the person you hire should do most of the work.

Q. Am I obligated to work with the lender, inspector, or other service providers you recommend? 

Due to a ruling called "RESPA" a "yes" here is a big red flag. While many great agents have a list of highly professional vendors in the area, you should never feel pressured to use the recommendation of an agent. It's illegal.

Q. How quickly can you get me into a home?

Great homes in any market move fast. Ask how your agent goes about the process of setting up showings and how quickly you would be able to see a favorite home.

Q. Will you represent me exclusively, or will you represent both the buyer and the seller in the transaction? Dual agency?

This one is a little complicated. Less experienced agents have a hard time managing a dual agency transaction. The agent is attempting to act in the best interest of all parties and it can create some headache for them. Many commentators on this topic only look at one factor: "the deal". They ask the question, "How can an agent working to get the sellers the highest possible price also work to get the buyers the lowest possible price?" That is a great question, but it is the wrong question. The simple answer is that the agent sticks to the numbers with a comparative market analysis and then asks the buyer "How much would you like to pay?" then asks the seller, "Would you sell it for ____ ?" 

What can cost more than the price of the home are TERMS. Often, in a dual agency transaction, both parties receive favorable terms because the agent is familiar with the situation of both parties. The transaction is usually smooth with less uncertainty saves money and headache for the buyer and seller.

An important distinction: In Arkansas, the listed property is represented by the listing broker, not just the agent. Any agent who refuses dual agency agrees not to let their buyer see any of the properties listed by their broker. This could eliminate hundreds of potential homes for you. 

It is best to select an agent with experience in managing a dual agency transaction and has the knowledge, expertise, and professionalism to appropriately handle both sides of a transaction. How is it in the best interest of my buyer to withhold a property that is a perfect fit that I have listed to avoid dual agency? I would argue that I am then NOT acting in the best interest of either party. 

Q. What sets you apart from other agents? 

Look for real expertise here, not just excitement and likability. Look for an agent with a proven track record, great testimonials from happy customers, a good professional reputation, deep knowledge of the market, and willing (with the "know how") to meet any special needs or requirements that you might have in your home search.

Q. Can I cancel the contract if I am unhappy with your service? 

Some agents change a fee if you try to cancel. This could be a major problem if you are attempting to purchase a property and your agent goes out of town without any way to contact them, or if you wind up having a personal conflict with them. What is their policy regarding cancelation?

Q. How will you keep me informed about the progress of my transaction? How frequently?

Communication is KEY! Make sure your agent has the appropriate avenues of communication open and has a plan for how to communicate through the process.

Q. What's your business philosophy? 

There is no right or wrong answer here. This question will help you to get to know your agent better, learn what is important to them, and how they think about their business and their relationship with you.

I hope this list of questions helps you as you interview potential agents!

Drop by the office and take 30 minutes to say Hi and get to know us. We will tell you a little more about the home buying process and the next steps to find home. We will also review your plan to buy and talk about your needs and wants and will help you to narrow or expand your criteria and will provide some additional questions to talk about and help develop our plan.

Lets meet up to see if we are a good fit for each other. I would be honored to be the one to help you find your next home.  In the meantime, checkout my bio.

Home Buying 101: Step 1 - Get Pre-Approved

This is the first post in a series of posts that will take you through the process of buying a home. 

Many buyers want to start seeing houses right away, before getting PreApproved. Most of them have great credit, good income to debt ratios, and no real reason to be denied for a loan. So, why is it important to visit with a lender first?