A buyer’s agent is a real estate professional who is legally licensed to represent the buyer’s interests in a real estate transaction. Buyer’s agents search for properties, schedule showings, and negotiate contracts on behalf of homebuyers. Plus, there is no additional cost, as the buyer’s agent receives a commission from the sale price.
When buying a home, the safest way to ensure your interests are protected is to sign a contract with a dedicated buyer’s agent. To evaluate the agent agreement before signing, use Rocket Lawyer’s “Ask a Lawyer” service. You can ask specific questions about the contract and get answers from a qualified attorney on-demand. Ready to try Rocket Lawyer? Get a free trial.
What Buyer’s Agents Do
A buyer’s agent represents buyers in their search for and purchase of a home or other real estate. As part of this, agents help buyers identify and tour properties that match their needs, submit and negotiate offers on the buyer’s behalf and navigate the due diligence and closing process. Generally, a buyer’s agent simplifies the homebuying process by connecting clients with reliable real estate professionals like home inspectors and ensuring a timely closing.
Help Buyers Find the Right Property
The process of working with a buyer’s agent typically begins by uncovering the buyer’s wants and needs—including their budget. These agents will also research homes that meet the buyer’s criteria and sort through active listings to make appropriate suggestions. Then, to help the buyer decide which home is right for them, a buyer’s agent will schedule appointments to tour homes, explaining the pros and cons of various properties and neighborhoods.
Submit and Negotiate Offers on the Buyer’s Behalf
Once the buyer settles on a property they want to purchase, the agent advises the buyer on an appropriate offer amount and will write up an offer letter to purchase the property and present it to the listing agent—who represents the seller. If the offer is rejected, they either renegotiate the offer or try the alternative properties on the buyer’s list.
Refer Buyers to Reliable Professionals
Buyer’s agents typically have extensive experience in their markets and can recommend other home professionals to help a buyer navigate the due diligence and closing process. These include real estate attorneys, inspectors, mortgage brokers, and other local professionals. Also, a buyer’s agent may be able to recommend a local mover, contractor, or landscaper to help simplify the moving process.
Overcome Obstacles in the Closing Process
The homebuying process can be difficult to navigate, especially for first-time homebuyers. Once you’ve found a home and negotiated an offer, a buyer’s agent will help you through the due diligence period and ensure the transaction closes on-time. This may involve scheduling an appraisal and inspection, communicating with the listing agent, and renegotiating based on findings during the due diligence period.
Difference Between Buyer’s Agents and Listing Agents
A listing agent is a real estate professional legally licensed to represent a homeowner in the sale of their home and has to represent the seller’s best interests. In contrast, buyer’s agents represent homebuyers and see to their best interests throughout the entire buying process.
Once a homebuyer makes an offer, and the parties agree to contract terms, the buyer’s agent becomes known as the seller’s agent. This is because the agent facilitated the sale of a home to a buyer. Generally, “selling agent” and “buyer’s agent” are used interchangeably because their duties are the same.
How Much Buyer’s Agents Cost
In general, a homebuyer doesn’t pay a fee to their buyer’s agent. Instead, the agent receives a portion—typically half—of the overall commission for the sale. In most real estate transactions, the listing agent has a contract with the seller for a commission between 4% and 6%. When an offer is submitted through a buyer’s agent, the listing agent splits their commission with them. Read more in our article on real estate commission splits.
How to Find a Buyer’s Agent in 4 Steps
The best way to find a local buyer’s agent depends on where you are looking for a home. If you’re staying close to your current location, ask local friends and family for recommendations. Alternatively, visit websites like Zillow to search for qualified agents in your neighborhood or across the country. Then, interview candidates to learn more about their experience, specialization, and availability. If possible, avoid dual agency representation.
1. Use Agent Matching Tools on Websites Like Zillow
Zillow Agent Finder helps match you with a qualified real estate agent. It’s a tool that takes into account ratings from Zillow users, as well as data on past sales and any listings an agent may have. To find a great buyer’s agent on Zillow, look for someone with great reviews and experience working with homes in your neighborhood and price range. For example, an agent who sells $2 million homes is probably not a great fit for your $100,000 house.
2. Ask People You Trust for Referrals
Ask family, friends, or coworkers you trust if they have an agent they can recommend in the neighborhoods you’re considering. Once you have a list of names, look them up using Zillow or realtor.com to make sure they have good reviews and experience finding and selling homes like the one you’re looking for. Just remember that the best real estate agent for someone else may not be the best fit for your homebuying needs.
3. Interview the Top Candidates
Once you’ve selected a few agents who you think might be a good fit, the next step is to interview them. Before signing a contract, ask about their experience, specializations, and current schedule and availability. Finally, consider whether they’re someone you want to spend time with. For example, if they’re not capable of being calm, focused, and friendly, they may not be a good fit to assist in your homebuying experience.
Some of the most important questions to ask when interviewing a buyer’s agent are:
- What neighborhoods do you specialize in? Find an agent who has the local expertise and has recently closed a large number of deals in the areas you’re interested in.
- What’s your schedule and availability? You’ll want an agent who will be readily reachable. If you work odd hours, make sure they will be available when you’re free.
- How long have you been a real estate agent? You ideally want someone with a couple of years of experience and a proven track record of selling homes.
For more ideas about how to find a qualified buyer’s agent in your area, check out these tips for finding agents from the pros.
4. Avoid Dual Agency With an Agent/Buyer Contract
A dual agent is an agent who represents both the buyer and seller in the transfer of real estate. In the case of a dual agency relationship, the agent does not have a duty to put the buyer’s interests above the seller’s. For this reason, you should be cautious if your agent shows you a house for which they’re also the listing agent. In this situation, the agent will have to balance your interests against the seller’s rather than exclusively representing your interests in the deal.
If you use a buyer’s agent, remember that, legally speaking, your interests will be represented by their boss—the designated broker. This means that if you decide to purchase a home listed by an agent who works for the same designated broker, the broker is technically representing both your interests and the seller’s interests.
Using a dual agent may save a small amount on closing costs and commissions, but this arrangement can put your best interests at risk. One way to avoid potential dual agency is to sign a contract with an exclusive buyer’s agent who works for a brokerage that only represents buyers. This can be tricky but could be your best option if you’re concerned about potential conflicts of interest.
Pros & Cons of Using a Buyer’s Agent
Using a buyer’s agent is a great way to simplify the process of searching for and buying a home. What’s more, a dedicated agent will represent your best interests during the entire real estate transaction and help you through the complicated due diligence and closing process. Even so, working with a buyer’s agent may require a contract, and you may find that it’s more difficult to negotiate a deal when the listing agent is splitting their commission with your agent.
Pros of Using a Buyer’s Agent
The pros of using a buyer’s agent include:
- No conflict of interest: A dedicated agent will focus exclusively on protecting your interests throughout the entire homebuying process.
- Help when touring houses: Most homebuyers visit 10 or more houses before choosing one, so the selection process can be difficult. Buyer’s agents are experts at helping people find their perfect homes and can provide much-needed assistance and insight while you search for a new house. Plus, they’ll coordinate viewings so that you don’t have to.
- Advanced negotiation skills: A buyer’s agent will help you negotiate the best deal possible without being influenced by the interests of sellers. They will also be able to help you through additional negotiations that come up during the due diligence process.
Cons of Using a Buyer’s Agent
The negatives of using a buyer’s agent include:
- Shared commission: If you and the seller have different agents, the final commission for the sale will be shared. With a dual agency, the agent may be able to shave a few thousand dollars off the price to close the deal. However, when there is both a buyer’s agent and listing agent involved, this is less likely and may make it more difficult to negotiate a price.
- Limited skill set: Buyer’s agents are also licensed to list houses but may not have the experience of a dual agent or dedicated listing agent. This can be a limitation if you want to use the same agent to buy a new house and sell the house you currently own.
- You may have to sign a contract: Most buyer’s agents require homebuyers to sign a contract to ensure they receive their portion of the commission if a sale goes through. The duration of the contract can vary, and details can be complicated—requiring guidance from legal experts to understand.
Frequently Asked Questions (FAQs)
Can you buy a home without a buyer’s agent?
Yes, but having a good buyer’s agent will make the homebuying process much easier and ensure your interests are protected. This is because the dedicated agent representing you has to put your interests ahead of their own and ahead of the seller. Even better, since the agent is paid by the seller, it won’t cost you anything.
Who pays the buyer’s agent’s commission?
Typically, the seller pays the buyer’s agent’s commission after the deal closes. This commission is usually split between the listing agent and the listing agent’s broker, and the buyer’s agent and their broker. A buyer’s agent may want you to enter into a contract to ensure they receive their portion of the commission.
How much money do buyer’s agents make on a deal?
The amount of money a buyer’s agent makes per deal can vary widely depending on the price of the home, the commission offered, and other factors. Generally speaking, however, buyer’s agents get half of the total commission paid by the homeowner, which can range from 4% to 6% of the home’s sale price.
Bottom Line: What Is a Buyer’s Agent?
The homebuying process is complicated and stressful for many buyers. However, a buyer’s agent can leverage their knowledge and experience to help buyers find, evaluate, and negotiate the purchase of a property. Not only will a buyer’s agent protect your best interests during the homebuying process, but they won’t cost you anything because their commission is paid by the seller.
Once you decide to enter into a contract with a buyer’s agent, have it reviewed by an attorney before agreeing to terms. If you don’t have an attorney already, consider using Rocket Lawyer’s “Ask a Lawyer” service. The platform lets you ask a specific legal question and get an answer from a qualified attorney on-demand. Get a free trial today.