Finding a Good Real Estate Agent: Things You Need to Know

Looking for a new home is both exciting and nerve wracking. Inexperienced new home buyers need to know how to locate a house that will suit their needs, and how to avoid costly mistakes. A good real estate agent can be a new home buyer's best friend.

It's important to know what to look for when hiring an agent. Before meeting with prospective agents, check realty web sites and advertisements in the area. Prepare a list of questions to ask, and listen carefully to the answers. A good agent will be willing and able to give specific answers to the your questions.

Information from Web Site

The web site can give a lot of information about a prospective real estate agent. Look for at least five years of experience, and some references or testimonials. A successful agent should have clients who can give a good recommendation. Also check for specific data about the particular real estate market such as median home prices and inventory.

Interview Questions and Answers

-          Describe to the prospective agent the type of property desired and specifics such as school district, proximity to work, and characteristics of the neighborhood that would be of interest. Then have the agent reiterate the objectives in his/her own words. This will reveal whether he/she listens carefully to what you say.

-          Ask about the list-price to sales-price ratio. A good buyer's agent should have a ratio that is under 97 percent, closer to 92 percent if this is a buyer's market.

-          Have the agent detail how she will go about finding an appropriate property. Expect to see 5-7 homes per day that the agent has previewed and can describe to you, or as many homes as you are comfortable seeing in one outing. Make sure the agent represents you exclusively for the type of home that you desire, and not other buyers who may be competing for the same property.

-          Find out whether your real estate agent  has real estate agent errors and omissions insurance. Just as doctors need to carry malpractice insurance, a reputable agent should have this protection.

-          Probe the agent's relationships with other professionals such as title and mortgage companies. How does he decide which companies to recommend? Does his agency receive any compensation for these recommendations? If so, choose a different agent.

-          Ask the agent, "What are the top three things that set you above the competition?" The answer should include integrity, ability to communicate, availability by phone or email, and other points in the buyer's favor.

Documents to Look Over

Before needing to make a decision, the client should be able to see:

• Buyer's Broker Agreement: This is the document that is signed when the buyer's agent is hired. It should state whether the buyer agrees to work exclusively with this agent, the length of time the contract will last, and that no fee is expected unless there is a closed deal. In most instances, the seller pays the buyer’s agency fee. Make sure that this is in your contract. All real estate fees are negotiable. Ask whether the client can cancel the agreement before it expires, should the relationship not be working out. The answer should be yes.
• Agency Disclosures
• Purchase Agreement: This should be a sample document, since no actual purchase agreement can be presented yet
• Buyer Disclosures

Final Question to Ask

What have I not asked about that I need to know? The agent should respond readily with specific information. No new client will ask all appropriate questions.

Armed with good questions and some prior knowledge, a new home buyer should be able to find an agent who will work in his/her best interests. This working relationship is an important key to making the experience of buying a home pleasant and rewarding.

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