Thinking About Buying A Home?
Wonderful idea . . . if you do it the right way.
Step 1: Find a Great Agent.
Step 2: Relax. We’ve got your great agent right here.
Yes, You Want and Need an Agent!
Look, I just want to find a house to buy. I can look on the Internet. Why would I need an agent?
Many think the buyer’s agent’s job is to say, “Here is the kitchen.” Or that it’s about looking in the MLS to find the buyer a property they like. Or that it’s making showing appointments with listing agents and sellers. Yes, we do that, but the real job of a buyer’s agent is to find you the best property for your needs given your circumstances, and get you the best possible bargain on it, and get you through the maze of legal and contractual tasks you’ll have to do to complete the purchase.
But couldn’t I just use the seller’s agent?
This is what is known as a big mistake. The seller’s agent and the seller have an agreement specifying the responsibilities of the agent. All of their legal responsibilities are to the seller. They are working for the seller, not for you, and they have a contractual obligation to sell that property at the highest possible price, on the seller’s best terms.
The buyer’s interests don’t enter into it. The sellers’ agents don’t care if you could buy a better property for less, or get a better deal on this one, and they don’t care about any potential problems or issues with the neighborhood or the home itself, now or later.
The seller and his agent know more about the property than you. A good buyer’s agent can fill that information gap. They spot issues that buyers need to know about before they make an offer. When you get to negotiations, a buyer’s agent has been watching what’s been sold in the area recently. You haven’t—and you’re not going to get in now. A buyer’s agent keeps your interests front and center.
If the seller’s agent convinces you that he can represent you as well as the seller—a situation known as “dual agency,” which is legal in Virginia but not everywhere—you have to ask yourself: What happens when the interests of the seller and buyer diverge, as they usually and naturally do? In that situation, the agent can’t do much more than back slowly out of the room, shut the door, and let the parties fend for themselves. Have fun …
How much does a buyer’s agent cost?
The quick and easy answer is … nothing! Wow! What a deal!
That is correct. The listing contract calls for the seller to pay the seller’s agent a set percentage of the sales price, and share that amount with the buyer’s agent, if there is one. If there isn’t, the seller’s agent gets to keep it all. Of course, the only person bringing money to the table is the buyer, so in that sense the buyer is paying it all—whether they have an agent, or not.
So, not using a buyer’s agent is not going to save you any money—and remember, you certainly aren’t going to get as good a deal, and may wind up making a huge mistake on the most important financial decision of your life. Why not get what you are paying for?
What’s this “cash back to the buyer” thing?
Just another one of Samson Realty’s little improvements to the way business is done in the local real estate industry. What we do is offer the buyers we represent a rebate of 0.5% of the sales price, if the buyer agent commission is at least 3%. While there is no standard, about 90% of commissions offered are in that range.
On a $400,000 purchase, that would be $2,000 to you. It’s our experience that most buyers, especially first-time buyers, are short of cash, and every little bit helps!
Aside from the commission having to be 3% or better, the only other caveat is that there are sometimes limits imposed by your mortgage company on the amount of seller subsidy and other incentives you can accept, which might curtail the rebate in some cases.
I’d be happy to answer real estate questions for you with no charge and no pressure. Email me, phone me, or check my blog – updated regularly with all kinds of interesting stuff – at
Tips for Buyers
Can you afford to buy a home? Did you know that paying rent can be more expensive in the long run? When you pay rent, your money is gone forever. But when you make mortgage payments you build equity in your home. Your home may also appreciate in value, often faster than the rate of inflation. Property taxes and mortgage interest paid on your personal residence are usually 100% tax deductible, and profits on the sale of your home are often tax-free. There are numerous advantages to owning a home. Here are some things to consider when buying your first home:
Credit and Affordability
Get a copy of your credit report. Most lenders will get a credit report and review it with you as part of their pre-approval process. The sooner you do this the better. If your credit report contains items that need correcting, you’ll want to fix them before you make an offer on a home. Many web sites offer calculators that help you determine how much home you can afford. Many of these use standard debt ratios of 28/36, meaning that your housing payments cannot exceed 28% of your gross income and that your total debt cannot exceed 36% of your gross income. However, depending on your assets, credit history and earning potential, you may qualify for more than what the standard debt ratio calculations would indicate. Contact a lender such as Prosperity Mortgage, First Savings Mortgage, or Wells Fargo Home Mortgage to determine how much you can afford. These lenders are backed by strong banks, they know the best programs, and best of all, they’re nice people that I know personally.
Buyers often assume they need to save 10-20% of the purchase price before they can buy a home. While most loan programs require cash for the down payment and closing costs, some allow 95-100% financing, and often the sellers can contribute closing costs.
In addition to your mortgage payment, you will also pay for property taxes and homeowners insurance. If you buy a condominium you’ll likely pay a monthly condo fee. Could your requirements change? Will you have a larger or smaller family in the near future? Will you some day need a home office or work area? Consider how your needs may change in the next several years.Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com
If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.
4 – 4.5% Listings with First-Class Service — Cash Back To Home Buyers!