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Hello! I've been an avid reader these threads for a while, and I figured it's about time to jump in.
My husband and I currently rent in Auburn, but are looking to buy our first home. We both work in South Portland, so it's important to be no more than an hour away.
Ideally, we'd like to move to a small, friendly town that has homes on a fair amount of land (an acre or more, preferrably) and in private settings. Our price range is low; we're looking at homes around $150,000.
The agent that we're thinking about signing with is not very much help. He gave the MLS listing website and told us to let him know which properties we'd like to see. Maybe I was misinformed, but I thought agents were supposed to actually help you find a home.
The website requires you to search by town, and outside of a few areas, I'm lost as to which ones to look into.
My husband and I are young and looking forward to starting a family in our own home. Help!
If you have reliable incomes this is an excellent time to buy a home. You should be able to find what you want in your price range if you are willing to do some minor fix-up. Your escape will be the appraisal. If you have an offer accepted at $142,000, but the home appraises for $129,000 the seller has two choices; sell at the appraised price or hope for a cash buyer.
If you buy this spring and close on your home by June 30 you will be eligible for an $8,000 tax credit. That isn't a deduction on your income; It's a check from Uncle Sam to you.
As to the broker you spoke with, he/she could be just feeling out what you really want or he/she could be discouraged due to the slow market. Before you sign anything with anybody you should get a written commitment as to what the broker representing YOU is going to do for you.
Helping you find a home is one of the many tasks of a buyer agent, but it doesn't stop there. A good buyer agent will help you with financing, help you get pre-approved for an amount that both you and the lender are comfortable with, help you write your offer on your property of choice and develop your negotiation strategy to buy at the best price and terms for you, help you find (and attend) the building inspection and the subsequent re-negotiation or termination of the contract if the house has too many issues that can't be resolved, manage the lender and title company to make sure that you meet your obligations of submitting and re-submitting endless documentation in order to keep your loan on track, schedule and attend the final walk through and closing and follow up after your move to make sure you are completely satisfied. Like a good marriage, communication and mutual expectations are crucial to a successful outcome.
Whenever I speak about real estate agents I use a great deal of cynicism. Not terribly long ago the real estate industry invented a new gimmick to blow smoke and mirrors at buyers and sellers alike: it's called "the buyers broker". It's hogwash.
Real estate sales generate commissions and NOBODY makes a cent until and unless the property gets sold. Therefore, real estate brokers ALWAYS work FOR the seller. Say that again, write it down in large RED letters on a piece of note paper and tape it to the mirror in your bathroom, the front and rear doors of where you live now, and to the dashboard of your car so that you will never forget it: REALTORS WORK FOR THE SELLER.
Oh, now, I can hear the real estate types on this forum howls and scream from here, and I haven't even posted this reply yet. The "buyer's broker" will yelp that they ONLY get paid out of the commission paid to the listing broker after the sale. That is correct. But unless the property is SOLD, they don't get paid. Ultimately no matter what, realtors get paid by the seller and therefore they WORK for the seller.
Use that as your guide, talk to a LOT of realtors all over the general area that you want, or think you want to live, and look at a lot of houses. It is a great time for you to be shopping for a home, and you will do much better than you can possibly imagine if you are stubborn and keep looking.
IF you think you need to have a realtor that you are "working with", what I would do is to talk to a lot of them until you find one that you seem to feel good about talking with. Remember: these people are NOT NOW, NOR EVER WILL BE your friend: they are professionals who want some of the money that you are going to fork over to someone for your next house.
So once you find a broker that you are willing to spend time with, make him/her your broker. Here is how you do that: tell the broker that you are interested in buying a home of a certain size, type, with such and such features. Your price range is below "X" dollars. Tell the broker that the broker will work for you, and will earn a finder's fee equal to 2% of the selling price at closing provided the broker makes sure that the price is as low as it can be, that the house passes ALL inspections and that the inspections will be ordered by the broker and that he will stand behind the quality of the inspections and the qualifications of the inspectors that he has chosen to examine the house. You will need to make sure tha tyou write all of this stuff down, and everyone will sign it. It may well be that you will need to have a lawyer make up the document, which will probably cost $150 or so: it doesn't need to be the Magna Carta: just a formal written agreement in principal.
The broker you select will earn whatever the commission split is from the listing broker, PLUS a commission from you for working FOR you. The broker who helpes you will do well for his/her time and effort, and you will in fact have a broker who is working for the BUYER.
House hunting is a long and involved process that requires a lot of time and effort on the part of buyers, and this is especially so for first time buyers. You will need to look at a lot of houses, but since the advent of the Internet, in an afternoon you can find two dozen houses that might work for you within twenty miles of where you think you need to be, for commuting and affordability purposes. These houses are all listed on the Multiple Listing Service, and virtually every house for sale is listed there sooner or later. Make your own list, and then go talk to brokers. Expect it to be very hard work. It is NOT like shopping for a new car, and the amount of work and time you put into the search will mean real money for you in ten or fifteen years.
But remember: the ONLY time a broker works for the BUYER is when the BUYER pays for the broker's service outside of the sale. All else is a game played at the buyer's expense.
Hello! I've been an avid reader these threads for a while, and I figured it's about time to jump in.
Welcome
Quote:
... The agent that we're thinking about signing with is not very much help. He gave the MLS listing website and told us to let him know which properties we'd like to see. Maybe I was misinformed, but I thought agents were supposed to actually help you find a home.
That was generally the level of support that I received when I was traveling to Maine shopping for a home.
Next if you go back to him and sign the contract. Bring a dozen MLS# written down. He can print out the full MLS sheets for each property.
Among the realtors that I signed contracts with, the best effort that I got from a Maine realtor was a realtor who would draw on a map where each property is and the easiest route for me to take to drive from one property to the next. While standing on each property, he instructed me to call the listing agent directly to ask them any questions that I had.
What really surprised me was how many listing agents had never walked on the properties that they were listing.
But of course each home buyer's experiences may vary.
I do wish you luck
Quote:
... The website requires you to search by town, and outside of a few areas, I'm lost as to which ones to look into. ...
Well you did say within a one hour commute of South Portland. I might recommend that you draw a circle on a map, and make a list of those towns.
... House hunting is a long and involved process that requires a lot of time and effort on the part of buyers, and this is especially so for first time buyers. You will need to look at a lot of houses, but since the advent of the Internet, in an afternoon you can find two dozen houses that might work for you within twenty miles of where you think you need to be, for commuting and affordability purposes. These houses are all listed on the Multiple Listing Service, and virtually every house for sale is listed there sooner or later. Make your own list, and then go talk to brokers. Expect it to be very hard work. It is NOT like shopping for a new car, and the amount of work and time you put into the search will mean real money for you in ten or fifteen years.
But remember: the ONLY time a broker works for the BUYER is when the BUYER pays for the broker's service outside of the sale. All else is a game played at the buyer's expense.
I agree.
I made five trips to Maine shopping for a home. Each time I spent between one and two weeks here, talking to realtors and driving around. It was a very long and tiring process.
The internet is a great tool, however as I found not all properties that are for sale are on the internet. I am not sure that even 'most' of them are on the internet.
Whenever I speak about real estate agents I use a great deal of cynicism. Not terribly long ago the real estate industry invented a new gimmick to blow smoke and mirrors at buyers and sellers alike: it's called "the buyers broker". It's hogwash.
Buyer Agency was created out of a class action lawsuit by several state's attorneys general in the early 1990s because sellers were getting representation, but buyers were not.
Real estate sales generate commissions and NOBODY makes a cent until and unless the property gets sold. Therefore, real estate brokers ALWAYS work FOR the seller. Say that again, write it down in large RED letters on a piece of note paper and tape it to the mirror in your bathroom, the front and rear doors of where you live now, and to the dashboard of your car so that you will never forget it: REALTORS WORK FOR THE SELLER.
Only in a case of Disclosed Dual Agency where both sides consent to limited representation, otherwise the seller's agent has fiduciary responsibilities to their seller client and if the buyer hires a buyer's agent, that agent has fiduciary responsibilites to the buyer. There are many sellers (when I've worked with the buyer) who would argue that I worked for them.
Oh, now, I can hear the real estate types on this forum howls and scream from here, and I haven't even posted this reply yet. The "buyer's broker" will yelp that they ONLY get paid out of the commission paid to the listing broker after the sale. That is correct. But unless the property is SOLD, they don't get paid. Ultimately no matter what, realtors get paid by the seller and therefore they WORK for the seller.
Sometimes the proceeds that go to the agency procuring the buyer come from the seller's proceeds, sometimes both seller and buyer participate. That is negotiated between agency and client/customer. The full service agents do get paid at closing, if there is one. If there is no closing, the agents may spend weeks or months with a buyer or seller with absolutely no compensation.
Use that as your guide, talk to a LOT of realtors all over the general area that you want, or think you want to live, and look at a lot of houses. It is a great time for you to be shopping for a home, and you will do much better than you can possibly imagine if you are stubborn and keep looking.
It is good to interview agents in their offices to see what they have to offer. If you want an agent to represent your interests in a transaction, a written Exclusive Buyer Representation Agreement must be executed. This is state law, regulated by the Maine Real Estate Commission. If a buyer does not need representation, they can work with as many brokers as they like, but none can offer representation. Most buyers need and want somebody to advocate for them. There is a federal tax credit of $8000 available to first time buyers ($6500 to some repeat buyers) if under contract by April 30 and close by June 30. Maine State Housing is also offering a $2500 grant to qualified buyers which can be used for a downpayment or closing costs for a limited time. Interest rates are also artificially low right now due to the Fed's buyback of Mortgage Backed Securities, scheduled to conclude at the end of March. Nobody knows what will happen when these incentives go away, but they won't be around forever.
IF you think you need to have a realtor that you are "working with", what I would do is to talk to a lot of them until you find one that you seem to feel good about talking with. Remember: these people are NOT NOW, NOR EVER WILL BE your friend: they are professionals who want some of the money that you are going to fork over to someone for your next house.
Most of my clients have become my friends, the official relationship ends at closing or at the expiration of the contract, but the personal relationship continues, if both parties wish.
So once you find a broker that you are willing to spend time with, make him/her your broker. Here is how you do that: tell the broker that you are interested in buying a home of a certain size, type, with such and such features. Your price range is below "X" dollars. Tell the broker that the broker will work for you, and will earn a finder's fee equal to 2% of the selling price at closing provided the broker makes sure that the price is as low as it can be, that the house passes ALL inspections and that the inspections will be ordered by the broker and that he will stand behind the quality of the inspections and the qualifications of the inspectors that he has chosen to examine the house. You will need to make sure tha tyou write all of this stuff down, and everyone will sign it. It may well be that you will need to have a lawyer make up the document, which will probably cost $150 or so: it doesn't need to be the Magna Carta: just a formal written agreement in principal.
Real Estate Commissions are negotiable between agency and client/customer and our office policy is to reduce that to writing either in a represented or non-represented agreement. Inspections are at the discretion of the buyer and are negotiated between buyer and seller with the assistance of the real estate agents, if there is a signed agreement to do so. The agent may recommend a home inspection company, but the agreement is between client/customer and inspection company. Some inspections are mandated by lenders on specific loan products and some are not. There is no law requiring a seller to fix anything that they chose not to, hence the "as is" sale. The buyer has the option to continue in the contract or cancel and pursue another property.
The broker you select will earn whatever the commission split is from the listing broker, PLUS a commission from you for working FOR you. The broker who helpes you will do well for his/her time and effort, and you will in fact have a broker who is working for the BUYER.
The fee that my company earns is spelled out in the agreement drawn up between the company and the client/customer.
House hunting is a long and involved process that requires a lot of time and effort on the part of buyers, and this is especially so for first time buyers. You will need to look at a lot of houses, but since the advent of the Internet, in an afternoon you can find two dozen houses that might work for you within twenty miles of where you think you need to be, for commuting and affordability purposes. These houses are all listed on the Multiple Listing Service, and virtually every house for sale is listed there sooner or later. Make your own list, and then go talk to brokers. Expect it to be very hard work. It is NOT like shopping for a new car, and the amount of work and time you put into the search will mean real money for you in ten or fifteen years.
Agreed, and the choice of who represents your interest in this process should be a business decision. Interview and choose the agent you feel will best represent you.
But remember: the ONLY time a broker works for the BUYER is when the BUYER pays for the broker's service outside of the sale. All else is a game played at the buyer's expense.
That's your opinion and you're entitled to it. The idea of both agents trying to get the price as high as possible is a fallacy. The difference between a house selling at 320,000 or 300,000 is $20,000 to a buyer, the difference to an agent after that fee is divided and divided again before paying expenses and taxes is a good dinner out with the family. However the additional referral business from the satisfied client for those of us who are in the business for the long term is priceless. If you are a buyer, interview several agents, check references and then enter into a relationship with somebody that you can trust and somebody that can communicate with you on your schedule, just like you'd choose any other professional in a business relationship.
That was generally the level of support that I received when I was traveling to Maine shopping for a home.
Next if you go back to him and sign the contract. Bring a dozen MLS# written down. He can print out the full MLS sheets for each property.
Among the realtors that I signed contracts with, the best effort that I got from a Maine realtor was a realtor who would draw on a map where each property is and the easiest route for me to take to drive from one property to the next. While standing on each property, he instructed me to call the listing agent directly to ask them any questions that I had.
What really surprised me was how many listing agents had never walked on the properties that they were listing.
But of course each home buyer's experiences may vary.
I do wish you luck
Well you did say within a one hour commute of South Portland. I might recommend that you draw a circle on a map, and make a list of those towns.
Not all real estate agents are created equal, like any business relationship, interview several, check references and spell out your expectations.
I had the best Realtor, he represented both the seller and me. He was honest and brokered the deal as well as going out of his way to accomadate us. Though the transaction was business, I have the utmost regard for him and consider him a friend and neighbor.
maineguy8888: I know him by heart, trust me. Thanks for the tip, though. I'm sad his radio show is no longer on. Do you know if he moved to a different station?
Quote:
If you buy this spring and close on your home by June 30 you will be eligible for an $8,000 tax credit. That isn't a deduction on your income; It's a check from Uncle Sam to you.
The tax credit is one of the reasons we decided to start looking now. I wasn't aware that it was an actual check; I thought it was a credit for taxes you might owe, and then maybe a check for the difference. A straight $8000 is even better!
All the advice about real estate agents is very helpful, thank you. I've read many books about buying a home, but nothing beats hearing real experiences. We're seeing a house this Saturday with the agent, and I will be sure to ask him the probing questions you all have mentioned. Thank you again!
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