Most people don’t buy a home every day -- it’s a once-or-twice-a-decade activity for many of us as opposed to a day-in-day-out activity.
So when you start getting serious about buying, whether it’s your first home or your fourth, it’s easy to feel overwhelmed pretty quickly. Some parts of the process (like searching for a home) have recently become more accessible through technology, but when every buyer has access to the same technology and resources, it’s tough to stand out in a crowd of bids. And there’s a lot more to the journey than just finding the home: You need to figure out financing, negotiate on price and possibly request repairs or make concessions, get the home appraised and inspected, and make sure all the i’s are dotted and t’s are crossed by the time you sit down at the closing table to sign your name on a stack of paperwork.
That’s why a real estate agent can be a valuable resource for buyers -- unlike most of us, real estate agents do manage home sale transactions every day, and they can serve as a sherpa on the buyer’s journey, ushering you from Base Camp “I Think I Want To Buy A House” to Summit “I’m A Homeowner,” step by step.
Here are just a few of the ways an agent can help smooth your homebuying path.
Getting pre-approved by a lender
Instead of paying rent to the owner of your residence every month, as a homeowner, you’ll be paying back a bank for the money you borrowed to buy your own place.
But before you get there, you need to find that bank and secure that loan. Where do you start that process?
A real estate agent is one good place -- agents work with an array of local loan officers representing different lenders, and depending on whether you’re a veteran, your down payment size, your credit score, and a number of other factors, a good local agent will know which lender (and loan officer) might be the best fit for you.
The right loan officer will explain your financing options and help you drill down to the real nitty-gritty, like the size of the monthly mortgage payment that’s affordable on your current income, what you should expect in terms of closing costs, and whether the down payment amount you’ve saved is going to cut it.
Agents can also explain what to expect during the mortgage loan application process, what you should know about transferring money during the sale, why it’s important to review certain documents -- and they can usually even attest to whether certain lenders have parameters that might be better for one type of home instead of another.
Choosing a home
Many buyers (mistakenly) think that they don’t need an agent’s help finding a home. They know what they want, and they know how to search the internet -- what’s the point of hiring an agent?
Here’s the thing: You might not need any assistance when you’re picking out a car, but there is no consumer report that exists for the specific home you’re about to spend 30 years paying off.
What if you’re someone who thrives on direct sunlight and your “dream home” happens to be located by a hill that’s going to cast it in shadow half the year?
What if you can’t sleep when airplanes are flying overhead and your soon-to-be home is in a major airport’s flight path?
What about the schools? What about the amenities? How do homes in that area hold their value -- can you expect this investment to appreciate in the next few years, and by how much?
Cars come off an assembly line; homes do not. Whether it’s the condition of the home or the neighborhood around it, you don’t want to be unpleasantly surprised once you move in.
A real estate agent has seen other buyers make mistakes (and find gems) and can help you find a home that you still love two or three (or ten!) years down the road.
Making an offer
This can be one of the most nervewracking parts of the process for buyers. Because even if you love the home and are making an offer at the very top of your budget … there is no guarantee that the seller will think it’s worth accepting. You could wind up starting all over again on the home search process.
Real estate agents can help you do more than make an unsophisticated stab in the dark when it comes to offers -- they can show you data that will help you understand whether you’re likely to be underbidding or overbidding, for example, such as the recent sales prices of similar homes nearby, the price-per-square-foot range in the neighborhood, and much more.
This is really where the home sales rubber meets the road. If your offer is high for the market, the seller may leap at it … but you’ll always wonder if you could have gotten a better deal. And if your offer is low, you should understand that so you won’t feel offended or put-out if the seller comes back with a counter-offer.
You did it! You found a home you love at a price you can afford, the seller accepted the offer, and now all you have to do is sit back, relax and enjoy the closing process. Right?
OK, that’s not exactly true. Even the simplest real estate sale involves quite a few mandated hoops that must be jumped through -- like the inspection, the appraisal, title review, and more.
In some states, a title company manages the the closing process; in others, a lawyer is involved. But the negotiation isn’t over yet, not by a long shot.
What happens if the inspector finds an issue with the home that must be addressed before the sale is legal? Who will pay for those repairs -- you or the seller?
And what can you expect in terms of finalizing the loan and moving your down payment or earnest money from your account to the seller’s? What should you look for during the final walk-through?
An agent can lay out a road map from offer acceptance to keys-in-hand and make sure you’re staying on track ... which can feel like a lifesaver to a buyer drowning in details.
… And beyond!
When you’re all moved in and settling down, you’ll probably discover some upgrades you’d like to make and work on shaping your home to fit you instead of the previous owner.
Your real estate agent already knows your house (and the neighborhood), so why not reach out when you’re considering adding a deck or redoing a bathroom? They can help you figure out which improvements are timeless and will increase your home’s value versus quickly dated trends that you might have to redo again before you sell.
And that’s not all -- your agent probably knows people in the neighborhood, from home service providers like plumbers and electricians to lifestyle service providers like day-care operators and petsitters. If you need a recommendation, ask your agent!
Buying a home goes well beyond finding one for sale on the internet. Buyers who use the services of a real estate agent find the process more enjoyable and less stressful -- and they also have an advocate to negotiate tirelessly on their behalf.