There are some things that many real estate agents don't want you to know. Keep reading, and you'll be ahead of the game.
Secret #1: You're the lone bidder on this house.
If your agent is not a buyer's agent, she's not looking out for your best interest. Why should this person, who's motivated to get as much money as possible for his client (the seller), tell you that you're the only one bidding on the house?
Secret #2: I could be working a lot harder for you.
If you have children, or think you'll have children while living in your new home, you'll want to know about school districts and crime rates in your neighborhood. Sure, you can find that out for yourself, but a good agent knows the area and is familiar with this important information. If the agent isn't offering all kinds of salient nuggets about this neighborhood and why it is or isn't a good place for you, consider seeking another agent.
Secret #3: This house is stale.
Again, this is a problem when dealing with a seller broker. "Stale" means that the house has been sitting on the market, unsold, like an open bag of potato chips that has been sitting at the back of that corner cupboard. You should have more bargaining power when dealing with a stale house.
Secret #4: My fee is negotiable.
You may be able to change the way your agent is compensated, such as making it a flat fee, with added incentives for helping you to lower the price. If that doesn't happen, though, you may also be able to knock off a percentage point from the agent's commission. They will tell you what's "normally" the commission, but that doesn't mean it is writ in stone. You can re-writ it.
Secret #5: Both the seller's agent and I might kick in some money to make the deal happen.
Imagine that you're an agent. You stand to make a few thousand bucks if this $250,000 house gets sold. However, during the negotiating process, things have gotten a bit acrimonious for one reason or another. Your client (the buyer) just absolutely, positively will not fork over the $450 for a new washing machine, or the $129 for a new garage door opener. Wouldn't you be willing to pay $225 (half of $450, with the seller's agent kicking in the other half) in order to make those few thousand bucks? Of course you would.
Legally, agents can't hand off checks to buyers or sellers. It happens, but it shouldn't. However, an agent can take a cut in the commission. So, at closing, the commission may be modified: The broker gets the modified commission amount and then hands off the correct portion to the agent.
Secret #6: You can use more than one agent.
Before you sign an exclusive agreement with your agent, you can -- as you're shopping for agents just as much as you're shopping for houses -- have several people showing you around. However, don't do anything sneaky. Make it clear to the agents involved that you're not interested (at present, anyhow) in having an exclusive broker. (It's very much like saying to that person you've just met, "I don't want to date only you, I'm still looking around -- but you're free to take me out for dinner.")
Secret #7: This house hasn't sold for a good reason.
This is another reason to have a strong buyer's agent on your side. Brokers are required by law to tell you about any structural problems in the house, but they won't always tell you about anything else that might have happened there -- for example, that it's been renovated since that drug-running family of 20 trashed the place, and that there was a shootout featuring AK-47-wielding thugs of the Transylvanian Liberation Army. A strong broker will find that kind of information out for you. A seller's broker will do all he can to prevent the subject from coming up.
Certain states require disclosure of "stigmatized properties." In other states, it's not clearly defined, or not defined at all. For instance, some states may require disclosure if such information would make a material difference to the value of the home. This would presumably include the fact that there's a hole in the roof, but not necessarily the fact that a crime was recently committed in the house.
You'll find more home-buying guidance and tips in The Motley Fool Home Center. Don't forget to also check out our Fool Mortgage Center, where you'll find links to several mortgage lenders offering attractive rates, as well as guidance on how to get the best deal. In addition, drop by our Buying or Selling a Home discussion board.
