Buying house without realtors

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bdylan
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Buying house without realtors

Post by bdylan »

So, our family is growing by leaps and bounds and we've been slowly looking for a larger space. We learned that some individuals who live in our same neighborhood are planning on selling this fall/early next year. After touring the house, we're interested in purchasing, and we had a conversation with them about doing it without realtors, which everyone seems on board with in order to save the 6% fee that can make everyone better off.

My question is -- without a realtor what are the key things that we need to be thinking about? Is there a checklist that folks have used before to ensure that everyone is protected?

Thanks!
daheld
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Re: Buying house without realtors

Post by daheld »

I personally would never do this. As a buyer, you don't pay the 6%, the seller does. There is no financial cost to you as a buyer for using a realtor.

We bought a home two and a half years ago that seemed simple from the outset. By the time it was done, our realtor, who we've used before and think very highly of, said it was the most complicated transaction and negotiation she's had in 20 years. We didn't pay her a dime since we were buying, but she earned the 3% she was paid from the sale.

A good realtor is worth it, and again, YOU'RE NOT PAYING THEM.
AerialP
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Re: Buying house without realtors

Post by AerialP »

I keep finding these "you don't pay the realtor" arguments to be a matter of mental accounting. Of course you are paying the realtor(s) - their services are embedded in the purchase price. You may not be cutting a check directly payable to their name(s) but surely they are being paid within the process and it will be part of what you are mortgaging.
Murgatroyd
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Re: Buying house without realtors

Post by Murgatroyd »

Consult an experienced real estate attorney
stoptothink
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Re: Buying house without realtors

Post by stoptothink »

daheld wrote: Wed Jul 01, 2020 2:59 pm I personally would never do this. As a buyer, you don't pay the 6%, the seller does. There is no financial cost to you as a buyer for using a realtor.

We bought a home two and a half years ago that seemed simple from the outset. By the time it was done, our realtor, who we've used before and think very highly of, said it was the most complicated transaction and negotiation she's had in 20 years. We didn't pay her a dime since we were buying, but she earned the 3% she was paid from the sale.

A good realtor is worth it, and again, YOU'RE NOT PAYING THEM.
You don't think the fact the seller has to factor in 6% to the realtor has any bearing on negotiations? The realtor's fee is built in to the price of the home.

We used a realtor to buy our home, and he is a great guy (who we've recommended to many others), but his entire role in the transaction was typing up the formal offer and sitting with us at closing. There are absolutely risks in not using an agent, but if you are detail oriented it isn't particularly difficult to handle the process yourself with a few hours of help from a real estate attorney. I know countless people who have done it (no horror stories that I know of) and it's what we intend to do next go-round.
eagleeyes
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Re: Buying house without realtors

Post by eagleeyes »

We are in process of purchasing a 1.7 million dollar home. Not having a realtor can cause some friction. Particularly during negotiation. But having a realtor add some lubricant was going to cost me 50k.

I don’t think they were doing extra work from when I bought a 500k house. How come the commission is tripled? Doesn’t seem worth it. Real estate attorney costs 500 bucks and talked me through the contract.
Doug007
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Re: Buying house without realtors

Post by Doug007 »

As others have mentioned, a real estate attorney and an escrow company can facilitate all you need without involving commission based sales people (realtors) who often provide little in the way of value.
knowledge
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Re: Buying house without realtors

Post by knowledge »

I sold my condo last year privately. Since the 5% fee wasn't involved, I sold to the buyer at lower price than what I would have listed for, which worked out for him as well. This was dead simple to do since an almost equivalent unit had sold the month prior at a known price.

We both used lawyers, and the typical inspections and appraisal processes were followed. It ended up working out quite nicely.
Topic Author
bdylan
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Re: Buying house without realtors

Post by bdylan »

I guess I should add -- as a buyer I do believe that I am paying for the realtor fees in some way the same way I feel that I am paying both sides of the payroll tax.

So, folks seem to think that initial steps would be to identify a real estate attorney and a good escrow company?
arsenalfan
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Re: Buying house without realtors

Post by arsenalfan »

I've done 3 of these, no problems. We had sales comps for the area, agreed on a price, then subtratcted 3% from it to share the 6% realtor fees.

Just get a get a good inspector/general contractor paid by buyer, to look over the property. And make a list of all repairs.
Real estate Attorney - really any reputable closing agency. They will tell you what's customary in the area (e.g. who pays recordation tax, etc).
Last edited by arsenalfan on Wed Jul 01, 2020 3:31 pm, edited 1 time in total.
Seal the Deal
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Re: Buying house without realtors

Post by Seal the Deal »

I have done it. Keys are having a good real estate attorney and thorough inspections (HVAC, roof, electric, etc. all separate). As mentioned, it can add some extra friction to the transaction so be prepared for that.
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MrBobcat
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Re: Buying house without realtors

Post by MrBobcat »

bdylan wrote: Wed Jul 01, 2020 2:53 pm So, our family is growing by leaps and bounds and we've been slowly looking for a larger space. We learned that some individuals who live in our same neighborhood are planning on selling this fall/early next year. After touring the house, we're interested in purchasing, and we had a conversation with them about doing it without realtors, which everyone seems on board with in order to save the 6% fee that can make everyone better off.

My question is -- without a realtor what are the key things that we need to be thinking about? Is there a checklist that folks have used before to ensure that everyone is protected?

Thanks!
Talk to the title company where you plan on closing to see what they need.

It's been many years but I have bought one residence and sold one w/o a realtor directly. On the first one I sweet talked the realtor I was using on purchasing to help me with the buy/sell on the house I was selling (different cities). On the second one I sweet talked the realtor I was using to sell my house to help me with the buy/sell on the house I was buying (again different cities). On the second transaction i did run things over with the title company to make sure all was in order. It was. Also on the second home I negotiated with the seller to drop his price by 50% of the RE commission he would be saving.

All buy/sells were done contingent on a home inspection and appraisals.
Last edited by MrBobcat on Wed Jul 01, 2020 3:39 pm, edited 1 time in total.
rich126
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Re: Buying house without realtors

Post by rich126 »

I'm not a fan of realtors but a good one (not a part timer, etc.) can be a huge help.

I think the flaw in people going this route is that they think they will get a better deal w/o a realtor involved but if I'm a seller and I already have an agent, I'm already committed to paying the agent and whether he/she splits it or keeps it all doesn't matter to me.

A strong agent knows what houses sell for and the conditions of the homes. Just because 2 homes listed for the same $/sq ft it doesn't mean they are equal especially with respect to the interior.

Maybe you can get a bit of a deal if you can find a seller who is listing it themselves and not paying a broker.

Now once you get an agent you can listen to their recommendations but when it comes to a home inspector, title company, loan, etc. I always do my own homework since most agents get money from recommendations. Doesn't mean they are bad recs since they want referrals but it does add a bias.
123
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Re: Buying house without realtors

Post by 123 »

The main things you need when you by a house without a realator are the same things as when you buy a house with a realator. You need financing (unless you are paying cash) and you need home inspection by a professional (unless you feel comfortable relaying on your own skills and abilities for this). If you use financing there is an issue of property appraisal but you would need that whether or not you use a realator, the appraisor is usually provided by the lender since the purpose of the appraisal is to primarily protect the lender.

Real estate procedures vary by state/area. I've been involved with two real estate purchase/sales in California without a realator and they were done without any difficulty (one involved financing and the other was cash).
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alfaspider
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Re: Buying house without realtors

Post by alfaspider »

stoptothink wrote: Wed Jul 01, 2020 3:14 pm
daheld wrote: Wed Jul 01, 2020 2:59 pm I personally would never do this. As a buyer, you don't pay the 6%, the seller does. There is no financial cost to you as a buyer for using a realtor.

We bought a home two and a half years ago that seemed simple from the outset. By the time it was done, our realtor, who we've used before and think very highly of, said it was the most complicated transaction and negotiation she's had in 20 years. We didn't pay her a dime since we were buying, but she earned the 3% she was paid from the sale.

A good realtor is worth it, and again, YOU'RE NOT PAYING THEM.
You don't think the fact the seller has to factor in 6% to the realtor has any bearing on negotiations? The realtor's fee is built in to the price of the home.

This. The seller would accept 3% less money if you didn't have a buyer's agent. We did exactly this (no buyer's agent) and got 3% discount on our recent purchase. This worked out to the price of a modest new car. The fee might be worth it if you are a first time homebuyer who is pretty clueless and who is purchasing a relatively inexpensive house, but I'm of the opinion that 95% of realtors do not justify their fees- doubly so on the buyer's side.

As for OP: going without a realtor is a GREAT idea, but I would consider hiring an attorney for the contract negotiations. Unless the house is really cheap or you go with a really expensive attorney, it should be much cheaper than paying realtors. You'll have a bit more administrative work to worry about with the title company, but they do most of the heavy lifting.
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ray.james
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Re: Buying house without realtors

Post by ray.james »

If there is no buyer, the seller has no transaction. So he is the one paying 6%

The buyer then goes ahead with mortgage and pays interest on that 6%. :D

edit: I am not against real estate agents. But I think it should change. Homes are found on redfin. Home report and everything is packaged via docusign. seller, buyer sign via docusign. They settle via escrow account manager. All of them take fixed rates. In what way are real estate agents special that needs percentage ? It is in the same vein as portfolio managers, pay them a percentage irrespective of out performance of index.
Last edited by ray.james on Wed Jul 01, 2020 3:45 pm, edited 1 time in total.
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CAsage
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Re: Buying house without realtors

Post by CAsage »

daheld wrote: Wed Jul 01, 2020 2:59 pm As a buyer, you don't pay the 6%, the seller does. There is no financial cost to you as a buyer for using a realtor.
Home buying is often recommended only if you are going to stay in the house for years - time needed for inflation or demand to recoup the transaction costs in selling. If you buy a house today, and then try and turn around and sell that same exact house a day later, and pay the realtors 6% plus all the other title insurance etc, you can lose 10%. It is true that the "comps" on a house include that fee, so it would be fair to base your offer on a 3~5% discount off the comps. Houses ain't worth list price! Think of it as back end sales load....
Oh, and you really need a good inspector, good comps, escrow company and lawyer if that's what's common in your area.
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adamthesmythe
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Re: Buying house without realtors

Post by adamthesmythe »

So is the idea that the seller gets 6% more, the buyer pays 6% less, or both share in the savings?

After you decide on this you have to figure out what the value is. In a usual sale the market determines this. Without marketing the house you need to guess or get an appraisal, maybe more than one?
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Watty
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Re: Buying house without realtors

Post by Watty »

bdylan wrote: Wed Jul 01, 2020 2:53 pm My question is -- without a realtor what are the key things that we need to be thinking about?
One time when real estate agents can really help is when an inspection brings up problems that need to be negotiated and they can act as a buffer to get the buyer and seller through it. You can be prepared to handle that but just be prepared to deal with that situation yourself.

Another is helping figure out who pays which closing costs. For example if a county has a $250 recording fee is that customarily paid by the buyer or the seller? A real estate agent would know that.

One other thing to watch for is that in some areas there may be important disclosures that need to be made so that a buyer cannot come back six months later with a problem that did not have the right disclosures. A title company or a lawyer that does not deal with real estate all the time may miss these. Be sure to use a lawyer that specializes in real estate in your area since each city and county may have special requirements.
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cheese_breath
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Re: Buying house without realtors

Post by cheese_breath »

daheld wrote: Wed Jul 01, 2020 2:59 pm A good realtor is worth it, and again, YOU'RE NOT PAYING THEM.
Just like you're not paying the insurance salesperson who tells you there's no commission because the company pays her or him.
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SR7
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Re: Buying house without realtors

Post by SR7 »

We sold a family house recently, no realestate agents used, just a real estate attorney for both parties. They are a order magnitude cheaper over here. The sale went through fine.

We sold the house a little cheaper to stimulate the sale, as the COVID-19 clouds gathered, and the house was some distance away. Yet we probably made the same or a little more due to very low fees with an attorney.

Inspection, finance approval and any searches were on the buyer to attend to, but they always are anyway.
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Lloydo
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Re: Buying house without realtors

Post by Lloydo »

Great timing... I just sold my house. I figured out the comp (high end) and sold for 3% less. I will have more in my pocket and the buyer is getting a great deal. I was able to use the standard Realtor agreement for my state and completed it with advice from a Realtor friend.

Do it if you can. Use a real estate attorney if you’re unable to access the most recent document versions.

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Katietsu
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Re: Buying house without realtors

Post by Katietsu »

OP- do you know anyone that owns rental properties? They might be able to direct you. The best professional is going to depend on the state. Sin my state, you must have lawyer involved and there is no such thing as a title agent that facilitates the sale. My understanding is that this is just the reverse in some states.

Make sure you go through all the steps, inspections, etc that you would use if working through a real estate agent and an unknown seller. I do not ascribe to friends and family and business do not mix. But I do think when the parties know each other that they sometimes get too casual with due diligence and communication. You should do all the same inspections that are customary in your area. You should put everything in writing.
Clemblack
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Re: Buying house without realtors

Post by Clemblack »

I have bought and sold many houses without using a real estate agent. I prefer it, and it saves everyone money.

Real estate agents are, for the most part, unnecessary. I am a real estate investor and have a real estate license.
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Re: Buying house without realtors

Post by 260chrisb »

Murgatroyd wrote: Wed Jul 01, 2020 3:13 pm Consult an experienced real estate attorney
This is all you need to do! I bought my house without a realtor and used my attorney. I was buying from a long time friend and of course offered them a review and the opportunity to make changes and was up front about everything that needed to be included (for example; the dock at a lake house). A real estate attorney will make this easy and be versed on all inclusions that will cover both buyer and seller. This isn't that difficult and you can save money on realtor fees.
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Re: Buying house without realtors

Post by dachshunddad »

I've bought 3 properties and never used a realtor. The sellers all had realtors but I negotiated my 3% off the price for not using one. It isn't necessary if you have knowledge of the area/property. Most states have a standard realtor contract. It is usually very straightforward and covers all the bases. Get an attorney and see if you can find your states realtor association contract. I do agree that you can get more friction without a third party. If you are a hard negotiator you may want to use a low fee fixed cost realtor to facilitate the deal.
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Re: Buying house without realtors

Post by ScubaHogg »

Real Estate Attorney > Real Estate Salesperson (euphemistically called a real estate “agent”)
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Bobby206
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Re: Buying house without realtors

Post by Bobby206 »

Murgatroyd wrote: Wed Jul 01, 2020 3:13 pm Consult an experienced real estate attorney
This is the opposite of what you should do. Just connect with a realtor and let the seller pay the fees. Don't overthink it.
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Cubicle
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Re: Buying house without realtors

Post by Cubicle »

The buyer is paying the commission. The thinking they are not is flabbergasting. Honestly. Auto salesmen aren't being paid by the buyer? Ebay isn't being paid by the buyer? The selling price wouldn't be any lower if the seller didn't have to cut someone a check? Nice place to live in.

I like the buyer's agent I used. Nice guy. Didn't really do much work. Would avoid a realtor if I can help it. Or tell them to split their commission with me.

I also found: my question -> buyer's agent -> seller's agent -> seller took very long. And the usual explanation from my agent was "I called her, she hasn't called me back". That's just a waste of time. I should call the seller & query them directly.
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jbourne99
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Re: Buying house without realtors

Post by jbourne99 »

The main purpose of the realtor is to match a buyer and seller. If you've already done that part than there is little value add for the realtor. You should use a real estate attorney.
daheld
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Re: Buying house without realtors

Post by daheld »

So my comment that you as a buyer aren't paying the real estate agent has clearly gotten some flak. I understand the contention that it's simply a game of mental gymnastics and the 6% fee is factored into the final price, which of course the buyer pays. I get it.

I think this is a valid argument if a sale is straightforward and simple. As I said, we bought a home about two and a half years ago that seemed simple at the outset, but two months later wound up being incredibly tedious with a nearly endless back and forth of negotiation, extensive inspections much beyond the usual structural, HVAC, roof, chimney, and sewer lateral inspections. Our realtor was incredibly helpful, diligent and prudent in dealing with all these issues, and honestly drove a harder bargain in the negotiation than we did.

I grew up in a family of home builders and know a fair bit about construction, and I can walk through a place and get a good sense of what's going on with a building. And I still think it makes sense to pay a good realtor. If someone is going to spend a half million or a million bucks buying a place and isn't familiar with evaluating real estate, having a good realtor is definitely worth a few percent of that home purchase.

Lots of folks may go the DIY route and come out just fine, but surprises happen and I prefer having peace of mind.
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Re: Buying house without realtors

Post by bsteiner »

jbourne99 wrote: Wed Jul 01, 2020 11:17 pm The main purpose of the realtor is to match a buyer and seller. If you've already done that part than there is little value add for the realtor. You should use a real estate attorney.
Correct. The broker's job is to find a buyer. In this case, the seller has already found a buyer (the original poster). So the seller doesn't need to hire a broker.
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Re: Buying house without realtors

Post by Jack FFR1846 »

If you're a buyer, think about what a real estate agent's pay is coming from. The bigger the price paid, the more they make. They're the ones who told me anything less than 95% of asking is an insult. Then I made an offer of 60%, which was accepted.

I've purchased 2 houses (out of 3) without agents. You simply hire the bank's attorney to also represent your interests as they coincide well. We sold one house and bought another and the attorney handled both closings in one day. Worked well and his fee was less than 2 times the single transaction fee because he simply did one closing, then went to lunch and then did the other.

What value has an agent brought to me ever? Well, our 2nd house was bought through an agent. The house was going to be listed on a Tuesday morning. We had contacted the agent late Monday during a house hunting trip. We were at the house Tuesday at 8:30am. That agency actually took its agents on a tour of new listings in a bus. We waited outside the house until the bus loaded, then looked at the house. We put in an offer and that afternoon it was accepted. So the agent's value was showing the house before it actually hit the listings. This was not in a fast moving market. We could have waited a month, most likely.
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Big Dog
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Re: Buying house without realtors

Post by Big Dog »

another alternative is for your neighbor to engage with a listing agent with the proviso that you get first dibs and if you buy it before it hits multiple listing, the agent gets a small flat fee for his/her trouble, say $500.
deltaneutral83
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Re: Buying house without realtors

Post by deltaneutral83 »

Lot of psychology. As a seller, I would probably go without one, as a buyer, I'd probably get one. Most people engage in mental accounting, you probably aren't going to get a break on the buy side by not having one, especially if the seller has an agent and the seller's agent is getting the 5-6% one way or the other, so probably bring an agent as a buyer. If you find a FSBO like the OP and you are a buyer you may be able to swing something with no agents on either side and everyone wins. I do not suffer mental accounting on the issue as a seller, x is what it costs and if you have a agent it's x+ whatever your buyer's agent wants. But most people don't think like this (as evidenced by the "the buyer doesn't pay" comments) so as a buyer your agent is much "cheaper" when it's all said and done and the value is probably worth it. Just my opinion.
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Re: Buying house without realtors

Post by Dottie57 »

ray.james wrote: Wed Jul 01, 2020 3:40 pm If there is no buyer, the seller has no transaction. So he is the one paying 6%

The buyer then goes ahead with mortgage and pays interest on that 6%. :D

edit: I am not against real estate agents. But I think it should change. Homes are found on redfin. Home report and everything is packaged via docusign. seller, buyer sign via docusign. They settle via escrow account manager. All of them take fixed rates. In what way are real estate agents special that needs percentage ? It is in the same vein as portfolio managers, pay them a percentage irrespective of out performance of index.
My brother and I are selling an inherited home. The real estate agent has been invaluable. She is shepherding us through all the steps. We have a list of 6 items to fix before closing and realtor has contactors/ handy people to fix all.
Last edited by Dottie57 on Thu Jul 02, 2020 8:45 am, edited 1 time in total.
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wander
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Re: Buying house without realtors

Post by wander »

When I was young (early 20s) and didn't know much but I knew a good realtor. When he showed me a house, he actually looked at the neighborhood and gave me advice. He pointed out stuffs that needed to be fixed or conditions and estimated the cost. While many want to sell the house ASAP for commisions, many are very helpful.

Most transactions are not complicated, you don't really need a realtor.
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bdylan
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Re: Buying house without realtors

Post by bdylan »

Thanks all! Very helpful - sounds like the key is getting a real estate lawyer and the rest should be fairly simple.
260chrisb
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Re: Buying house without realtors

Post by 260chrisb »

Bobby206 wrote: Wed Jul 01, 2020 9:28 pm
Murgatroyd wrote: Wed Jul 01, 2020 3:13 pm Consult an experienced real estate attorney
This is the opposite of what you should do. Just connect with a realtor and let the seller pay the fees. Don't overthink it.
I'm curious to know why you think this? A qualified real estate attorney would likely charge more than a non specific real estate attorney would (mine is not a real estate attorney) but my cost of having her draft a sales agreement was less than $400.00. The sales commissions saved were in excess of 15-20K. I have nothing against realtors but in some instances you simply don't need them as their fees are built into the selling price. I found it odd and very annoying that during my closing one of the reps from my bank who was not my local contact remarked three times about how much money I saved by not having realtor costs in the price of the home. :?
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Re: Buying house without realtors

Post by LittleMaggieMae »

You can find "boiler plate" real estate contracts for your state online for free.

You can check the accessor's office and recorder of deeds websites for the county the house is in - to find all sorts of public info on the house. It will show any permits pulled and may show documents on the loan(s) currently held for the house (and the previous sale prices). It may also show the demensions of any buildings on the property AND will describe them. It's really good if this info actually matches what's on the property. :)

You may have to deal with local codes/regulations/fees for the sale or purchase of the house. A local real estate atty and/or a local loan officer will be able to help you with this.

If you work with a local bank/credit union/S&L that primarily does mortgages in your area - your loan officer may be very helpful and will work with a title company and your lawyer to help you (and the seller) navigate the process with a realtor.
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Re: Buying house without realtors

Post by LittleMaggieMae »

I've found a Real Estate Agent useful for getting me info about local properties for sale right before the property hit the listing services. I've found a real estate agent (who had experience dealing with foreclosures/short sales/203k loans) to be extremely helpful and worth the expense.

I've found a Real estate agent extremely useful when looking for/buying a property in another state that I personally could not walk thru. I've bought two properties long distance without ever visiting the property - between the agent and a trusted relative and the marvels of modern technology (cameras on phones) and my ability to research properties/areas on line it worked out beautifully).

For buying or selling a house in an area where I'm familiar with the housing stock, the local codes, the local government involvement in house sales, the schools... a real estate agent isn't all that helpful. I've done this kind of local purchase and sale without an agent. The online real estate contract did the job. My lawyer and the loan officer (and a title company) kept all the moving parts moving.

Actually, I think once there's a signed contract (the negotiation between buyer is seller is done) there isn't much else a realtor does. OK, maybe holds the escrow $$ and is around to give you the keys to the property after the closing - but a RE lawyer can do that too.
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4nursebee
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Re: Buying house without realtors

Post by 4nursebee »

+1 for attorney to handle.
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alfaspider
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Re: Buying house without realtors

Post by alfaspider »

Bobby206 wrote: Wed Jul 01, 2020 9:28 pm
Murgatroyd wrote: Wed Jul 01, 2020 3:13 pm Consult an experienced real estate attorney
This is the opposite of what you should do. Just connect with a realtor and let the seller pay the fees. Don't overthink it.
Unless the buyer is giving you a gift in the amount of 3% of the value of the house (and why would they do this?), you are 100% paying for the realtor as the buyer. The cash is coming out of your purchase price.

Attorneys have to have an undergraduate degree, spend 3 years in law school, and pass a grueling bar exam. A realtor has no educational requirements other than a few weeks course and passing a ridiculously easy exam. Both may or may not be experts in real estate. Why would you pay many thousands more for a less qualified adviser :confused

Another point is that an attorney has an incentive structure that is better aligned with your interests. A realtor doesn't get paid unless you close. They are incentivized to downplay issues and are strongly disincentivized to tell you to walk away from a bad deal. They also get paid more if you pay more. An attorney that gets paid hourly will get paid regardless of whether the deal closes and how much you pay.
barnaclebob
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Re: Buying house without realtors

Post by barnaclebob »

daheld wrote: Wed Jul 01, 2020 2:59 pm I personally would never do this. As a buyer, you don't pay the 6%, the seller does. There is no financial cost to you as a buyer for using a realtor.
This is not always true. Most reasonable sellers in the OPs situation will recognize that they wont be paying the 6% to a realtor and will split the difference.
brandy
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Re: Buying house without realtors

Post by brandy »

I SOLD a home without a realtor or attorney. We got all the necessary papers from the title company, I had very recently had standard inspections done and the results available, the buyer accepted those results, everything went smoothly.
A second house, the buyer had an agent. Again, I had very recently had standard inspections done and the results available, the buyer paid for a second inspection (with the same company) the agent caused a few delays and I contacted her broker, then everything went smoothly. We did use their contract. Part of my requirement was the price: I was to get that amount. What THEY paid the agent was between them.
xerxes101
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Re: Buying house without realtors

Post by xerxes101 »

Murgatroyd wrote: Wed Jul 01, 2020 3:13 pm Consult an experienced real estate attorney
^^^ +1 be careful you are entering into a legally binding contract and while I agree that saving that 6% sounds attractive, you have no protection if you do this without an attorney.
xerxes101
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Re: Buying house without realtors

Post by xerxes101 »

bdylan wrote: Thu Jul 02, 2020 9:38 am Thanks all! Very helpful - sounds like the key is getting a real estate lawyer and the rest should be fairly simple.
Also, hire the best home inspector your money can buy. Make sure you hire that inspector and not the seller.
hoops777
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Re: Buying house without realtors

Post by hoops777 »

Realtors are just trying to make a living, so not trying to be negative towards them. However in my business before I retired, I worked with many because we installed flooring to make the homes more attractive to buyers.
The toughest part about being a realtor is getting listings. With that being said the commissions in hcol areas are ridiculous when compared to other professions that require years of education and special skills. You can definitely buy or sell without one but I would suggest an attorney for the legal documents.
K.I.S.S........so easy to say so difficult to do.
chuckb84
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Re: Buying house without realtors

Post by chuckb84 »

We sold a house 5 years ago when we retired with no realtors involved. The buyers got a very thorough home inspection---the most thorough I have ever seen---and then we just used an attorney to close. Buyers paid for the inspection and we split the few hundred dollars for the attorney. Total cost was something like .2% of the sale, not 6%!

Here's how the pricing worked. I did very careful comps and then presented the buyers with a price that was 3% less than what I thought a sales price with a realtor would be, and told them "3% for me and 3% for you". They countered, of course, but I pointed out that they were already getting a deal, that I wasn't budging, and with some very minor tweaks on conveyances, that was the sales price.

I ended up with more money in my pocket, they got a discount. I might have negotiated harder than a 3/3 split, but that last 1% was pretty much in the noise, so I was happy with it. Using realtors might have resulted in a higher SALE price, but I only care about the money in my pocket, and I'm quite sure I got close enough to an accurate market price that we came out slightly ahead.

I think this approach is worth trying, but be willing to walk away if you get uncomfortable. I can't fathom the BH gang, who fight for the last basis point on fees, just shrugging and paying 6% to realtors...
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Random Musings
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Re: Buying house without realtors

Post by Random Musings »

I have used a real estate attorney and it worked well versus the 6% alternative. And no, I did not tip the real estate attorney.

RM
I figure the odds be fifty-fifty I just might have something to say. FZ
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