Welcome back to Homebuying 101, a series on all the basics of buying your first home. For the second installment, we'll be diving into agents themselves, and explain how to find the right agent for you. When you're getting ready to buy or sell a home, finding the right representation can make all the difference. Sometimes, however, it can be hard to know where to start. First, let's define the types of agents.
Buyer, Seller and Dual Agents
A buyer's agent is someone who will help you shop for listed properties, make an offer and negotiate with the seller. A listing agent or seller's agent will help you price your home, list it, market it and negotiate with the buyer. In some cases, there can be dual representation where one agent represents both sides of the transaction, but in general, it's best to have one person who is solely working for you.
Agents, Brokers and Realtors
Next, you may notice a few different terms are used, sometimes interchangeably, when referring to representation. An agent is someone who is licensed in the states where they work and is beholden to both national and state laws. A REALTOR® is a trademarked designation from the National Association of Realtors (NAR). It applies to any agent who is a member of the organization and pledges to abide by an additional code of ethics as defined by the NAR. Because requirements vary by state, the NAR has state branches that focus more on the laws and training required to work in that state. Lastly, a broker is someone who has received a real estate broker license — this allows them to oversee other agents. Brokers themselves can work under another managing broker or operate independently. In Illinois, every agent is required to have a broker license.
Finding Your Agent
Now that you're familiar with the basic terminology, it's time to start your search. There are a few different approaches you can take when searching for representation, but you want to make sure to introduce yourself to at least three prospective candidates. Here are a few different avenues to try.
- Get a referral. The first route you can take is to ask friends, family and colleagues for a personal referral. Know someone who just bought their dream home? Ask away! Even if it has been a while, check with friends and family about who they worked with in the past — it's always a possibility that they're still working and have even more years of experience under their belt.
- Go online. Look at real estate listings in your target area and browse the sold listings. Browse a few listings and make note of who the buyer's agents were. This way, you're guaranteed to find someone who has experience looking for the type of home you want in the area where you want to live.
- Call a local brokerage. This is a great option if you are moving to a new area and don't have any trusted local connections, but anyone can use this method. Find brokerages near you and check out the online profiles of their agents. You can even reach out to the brokerage and ask a managing broker to connect you with someone.
- Get matched through your lender. If you've already gotten preapproval for a loan, your lender can match you to an agent in their network. The Real Estate Settlement Procedures Act (RESPA) forbids lenders and agents from compensating each other for referrals, and there's no obligation to go with the agent recommended by your lender.
- Use official referral sources. The local chamber of commerce can be a great resource for finding a trustworthy brokerage or agent, but you can also use the NAR's official search page.
Narrow Down Your Search
Once you've found a few agents to speak with, it's time to narrow down your search and find the one. Treat the initial consultation as a job interview and come prepared with a list of questions to ask — so what questions should you ask? Stay tuned, because we're covering it in the next installment of Homebuying 101.
