Hi, All. I’ve been reluctant to ask this question because I truly don’t want to alienate any real estate agents here. But I’m getting close to making an offer on a property and need to find any way I can to cut the costs. One potential way is to dispense with a buyer’s agent and get the listing agent to rebate that fee - or at least a part of it - back to me.
I’m not an investor; I’m just a guy looking for a home. I’ve found the property on my own. I’ve read the “disclosures” myself and have talked to the listing agent about issues I’ve found. I’ve gotten a contractor myself to estimate the cost of a couple of upgrades. I’ve gotten the pre-qualification letter. I’ve even talked to the listing agent about getting the buyer agent’s fee rebated back to me, and, though he won’t talk about dollar amounts, he seems open to the idea. I can figure out the offer amount on my own. That’s as far as I think I can get by myself.
The question is this: will a real estate attorney to do all the things that, from the offer letter on, I can’t handle myself? All the paperwork at closing, for example. Are there any tasks remaining that aren’t really the purview of an attorney for which an agent would be useful?
Finally, is it OK to ask whether anyone knows a good (and very reasonably priced) attorney in the Bay Area, and does anyone have any notion of what a flat fee would be?
Thanks in advance and, again, I don’t mean to anger the real estate agents who might read this.
Hi, dtsexpert. Thank you responding so quickly! I’m trying to save money over the entire transaction, not just the upfront costs. For example, while I understand that I’m not paying out of pocket for the buyer’s agent, I do know that his/her fee comes out of the purchase price. I’m trying to indirectly reduce the purchase price by getting the buyer agent’s fee rebated back to me.
In that case, you should negotiate with your buyer’s agent. A few things I am aware of are:
a. Reduced purchase price through buyer agent collect less from seller.
b. Buyer agent paid for new appliances and repairs (if seller side refuses to pay for them).
c. Free staging and fresh paints.
Since you are talking to the listing agent directly, did you ask the listing agent if they’ll do dual agency (aka represent you as well) and then give you a significant discount?
That is the easiest way to save money instead of brining in a real estate attorney into the equation.
Here are your options to save money and none of them need an attorney
Get listing agent to represent you as well and then give you a significant portion of the buyer’s agent commission
Hire a buyer agent who’ll return a significant portion of the commission back to you since you did all the work. Our own @SamShuehRealtor has offered that in the past if you are doing all the work.
Btw, did you find out what’s the buyer’s agent commission on the listing? And how much are you willing to pay to a 3rd party (attorney, listing agent or buyer agent) and expect to keep with you from that commission?
Hi, hanera: Are you then saying that I should really have a buyer’s agent because (to list the items in your order) a. I can get the buyer’s agent to accept a smaller commission, thus in practice reducing the cost; b. I can (perhaps) get a buyer’s agent to pay for some of the upgrades I’m contemplating? (I don’t think I need “c.” because I don’t need to stage anything, I think.) To ask it with less verbiage: Do you think I need a buyer’s agent, then?
Thank you, intangible. You’re asking questions I didn’t even think to ask, and you’re making incredibly useful suggestions. I feel a little ashamed at not just thinking of having the listing agent do dual agency for a discount. I think I’ll get right on that. And I’ll contact Sam Shueh Realtor to see what they (you?) might be open to.
Now, to answer your questions. I asked the listing agent about taking a discount. He said, essentially, “Possibly. Let’s talk later on down the line.” But no specifics about the exact commission amount. After listening to you, I’m inclined to go back and try to see what’s possible. As for the cost of an attorney: I’ve spoken to one and will speak to a couple others. The one to whom I’ve spoken wants $7500. That seems steep to me, but perhaps for what I’m asking - help from the offer letter to the end of closing - maybe it’s fair. What do you (or anyone else out there!) think?
Your listing agent’s response makes me speculate that they are open to dual agency.
And, no, I am not Sam nor have I ever met him or worked with him. But I love his posts here and he seems like an upright guy.
You can get a realtor to be your buying agent for approx the same price as the quote you got from the attorney. In which case, I’ll prefer a realtor.
What’s the list price for the property? And what’s the buyer agent commission?
Btw, keep in mind that according to MLS rules, listing agent only needs to share seller paid commission with buyer’s agent who’s a member of the same MLS. If you do everything yourself and bring an attorney, make sure you have it in writing somewhere that you’ll get the buyer’s agent commission. Otherwise, you may end up getting the worst of both worlds
I have personally made listing agents this proposition. I call it a win-win. There are too many agents in a typical RE txn and, if an informed buyer such as yourself is doing all the work, then one agent is sufficient to process the paperwork. Since listing agent is already the agent of choice from the seller, no need to bring another agent into the mix. But, if that means extra work for listing agent, they should be compensated. So, you need to determine what portion of the buyer agent commission you’ll offer to listing agent and what portion you’ll ask they return to you. They get more money and you get some money back, hence a win-win.
Actual on-the-ground results - some listing agents understood the proposition and agreed, others did not and got offended!
I have personally purchased one property with dual agency and given this same advice to several friends when they were purchasing. All had the same initial reaction as what you listed above and at least 3 friends used dual agency when they bought their bay area homes.
Agent over attorney sounds reasonable if the reason is that an agent will end up doing more work, or will know more about assembling a team for the closing, than an attorney. Is that right? Are there other ways that an agent is the better choice? I do have one question: won’t I be hiring an attorney anyway for the title search, filing with the county, state, or whoever, and perhaps some other stuff as well? In that case, does paying an attorney make sense because I’ll have to hire one anyway at some point?
I don’t know the buyer agent commission (though I’ll ask), but the list price is roughly $700,000.
What area are you buying? I used Unlocked Real Estate and they refunded about 2% of the purchase price to me. They are legit, check out Yelp reviews. I used Jesse Payne-Johnson:, one of the company founders. https://unlocked.com/
Thanks as ever, intangible, for the concise answers.
I’m just buying an apartment to live in in the city. And I’ve contacted Unlocked Real Estate. They look interesting. EDIT: I think that answer may not have been very specific. The property is in the Haight.
That’s the highest refund I have heard of yet. If you don’t mind sharing, what was the ballpark property purchase price where they refunded 2%? And, what was the buyer commission %? E.g. do they have any fine print like buyer commission has to be 3% for them to refund 2%.
