Choosing an Agent
Find Your Home
Some people like the extra attention that a hands-on real estate agent can provide. Others just want to be left alone as much as possible so they can look at the houses. You're in the process of educating yourself about the entire process so that you won't need as much hand-holding as some people. Be realistic about your time frame for buying a house and about the amount of time you'll be able to devote to the process. Let any prospective real estate agent know what you expect from her.
Ask for referrals
If you're staying in an area you know, ask friends and family if they can recommend someone to you. If you're moving to a new area, ask the Better Business Bureau or the Chamber of Commerce for the names of brokers in your new town that are members of their organizations. Call at least five of them and actually meet at least three.
Interview your agent
Remember that this person is going to have a huge effect on your life for at least several months. Make sure that you trust the agent, above all else. Ask about background and training. Ask about the area of town that you're interested in. Does the agent seem knowledgeable? Does she ask you questions about what it is that you want?
You want a strong agent. That is, you want someone who knows the market well enough to advise you on any given house; you want someone who's had experience in negotiating with sellers, and with closing; you want someone who can steer you toward at least three excellent settlement attorneys or building inspectors if you so desire.
Ask them to show you one house
Take a tour of the house with your broker wannabe. Has she listened to your requests? Did you want to see a single family detached home with two acres and are being shown condos instead? A good real estate agent will let you know if your desires are out of whack with reality but should also try hard to find you what you want. Is she showing you what you like, or what she likes?
Negotiate a fee
You can negotiate a flat fee with your buyer broker. Start with what you expect to pay for your house. Then take 3% of that amount (or half the standard commission rate in your state). If you're looking for a condo that costs $100K, tell your buyer broker that you'll pay her a flat $2,500 commission and then another $100 for every $1,000 that she saves you under $100K. This means that she will make money no matter what. Plus she has the incentive to make it as cheap as possible for you.
But remember, you are going to be signing a contract. Make sure that the services and method of compensation you expect are spelled out in the agreement. Will you have to still pay the fee if she hasn't found a house that meets your criteria in three months? Probably not, but get it down on paper.
If you don't hit it off...
Interview another agent. These guys are professionals and are used to having prospective buyers shop around for their services. Thank her for her time and say that you have decided to use another agent. Don't waste her time (and yours!) if you'd rather work with someone else.
What if the agent does a bad job? You can call the local real estate board if you feel that you are being treated unfairly. Agents are held to the standards by a state regulatory board, and if they violate any of the rules or regulations, they can lose their licenses.