Buying a house? Don't call the listing agent

You know those "For Sale" signs real estate agents stick in the ground with their name and number? If you're seriously looking for a home, get a buyer's agent. Tell them exactly what you're looking for, what you can afford and let them take you out house hunting--even to the open houses. Let them do all the talking and negotiating for you. Here's why:

Seller's agent vs. buyer's agent

The real estate agent on the "For Sale" sign is what's known as the "listing agent," also known as the "seller's agent. The listing agent markets the home and negotiates an offer strictly on behalf of the seller, the person who is trying to get top dollar from buyers like you. They have a signed contract with the seller(s) and certain obligations to them. Your best interests as a buyer are not one of those obligations.

You may think you're being cagey not having an agent-- that you'll just slip in under the radar and have a look during an open house, chat with the listing agent, get a little information, no strings attached. You get to talking and end up telling the listing agent all about yourself…perhaps mentioning how well-qualified you are to afford the house. The seller's agent is obligated only to the seller, so if you do not have an agent representing you and share personal information that gives the seller an advantage in later price negotiations, guess what? The seller's agent is obligated to share that with the seller, and they can use that to negotiate in their favor if you make an offer they think is too low.

Maybe you think you won't have to pay a commission if you don't have an agent. That's what a friend of a friend of mine thought when he called my listing agent to let her show him my house. He thought he'd save himself and me from paying the commission, but I had a signed listing agreement with my agent. That agreement stipulates the seller (me) pays both the listing and buyer's agents' commissions. It's customary: 3 percent to each agent, though the commission to the buyer's agent is negotiable; I could have requested as low as 2.5 percent, but my agent discouraged me. She cautioned that many buyer's agents won't bother showing homes where the seller hasn't agreed to pay them the full 3 percent commission.

If you're a home-buyer

1. Get your own agent--and not the listing agent's partner, spouse, son, daughter or buddy from the same office. My listing agent has a husband and daughter who are licensed real estate agents. If someone came to her as my listing agent wanting to buy the house, she would have steered them their way so they would get the 3 percent on the buyer's side. In other words, don't ask the listing agent for their recommendations for a buyer's agent.
2. Take time to find an agent with whom you feel completely comfortable communicating and who thoroughly understands the locations and price range you're looking in.
3. Do as much preliminary house hunting online as you can to get a snapshot of what's listed in your market.
4. Have your agent set appointments for you to see the homes that pique your interest or accompany you to open houses.

Let your own agent be your eyes, ears, mouthpiece and negotiator if you're buying a house.