It’s not uncommon for homebuyers to at least consider the possibility of buying a house without a realtor. Some worry that they won’t get the best deal if they’re working with a realtor. Some worry the realtor just wants to get them into a home at the highest price to snag the biggest commission for themselves. But a great realtor never thinks this way: their job is all about helping buyers find the homes they’re looking for at fair prices. Even more importantly, there are six big risks you’re taking if you buy without a realtor.
You Could Overpay
When you’re buying directly from a seller, they’re setting the price, and they might not really understand the true market value of their home. It’s normal for sellers to overprice their property, and while sometimes this is for nefarious reasons, many times it simply comes down to personal attachment. If a seller has been living in a property, it naturally has a sentimental value to it that can be hard for a seller to let go of without some help.
Many sellers will rely on Zillow and similar sites to estimate the value of their property, and many don’t realize how inaccurate these sites are. Online property sites frequently have old, outdated, or even fake listings, all of which mess with calculations about property values. Even worse, some sellers price the home based on the money they believe they need rather than with any reference to the actual value of the home.
When you work with a realtor, you avoid overpaying. You have someone working in your corner who can analyze market value properly with tools that aren’t available to the average seller. Your realtor will protect you from losing money on a poor investment.
You Might Not Understand the Significance of the Inspection
Most people understand they need a home inspection before they buy, but deciphering the report from an inspector can be hard for the average person. The inspector’s job is to flag up every single flaw and point of concern they can find, and while that’s good in some ways, it can also be misleading.
Every home, unless it has just been built, is going to have issues. Things break down and there’s no way around this. Some items on an inspection report aren’t actually anything to worry about. Others may look like a serious issue when they’re not. On the other hand, something significant could escape your notice if you’re not sure what to look for.
A realtor can help you pick out the parts of your report that are key for your negotiations with the buyer. Your realtor will also have specific knowledge of the neighborhood and larger area and know if there are specialty inspections you should have done, like mold or termite inspections. If you miss one of these necessary specialty inspections, you could end up with tens of thousands of dollars in damage to fix not long after buying.
You Don’t Know What You Don’t Know
California, like most states, requires home sellers to disclose certain information about a property. Most of these disclosures relate to the ownership and physical condition of the home. Some of the things buyers must disclose include property tax issues, real estate transfer disclosures, any flood or drainage problems, and information about defects and malfunctions. It’s easy to believe that the law requires home sellers to disclose absolutely every potential issue with their home and that you can trust them to do so. The reality is more complicated.
In the first place, you may not find out about something a seller failed to disclose until long after you’ve bought the property. If this ruins the value of your property or causes you damage in some other way, you’re on the hook to pursue the seller for damages, and that only helps you if the seller has the personal worth to actually reimburse you for those damages. There are no legal penalties and no consequences if you don’t actually suffer harm that’s easy to prove in court.
A realtor is held to a higher standard. Realtors must disclose even more than private sellers, and they face strict penalties for not doing so. Even better, when you work with a realtor you have someone who can help you know what to ask about in the first place, meaning you’re much less likely to miss something. It’s far simpler and less expensive to avoid buying a property with a serious issue in the first place than try to pursue the seller for damages later.
You Might Run Into Appraisal Problems
When a seller isn’t using a professional realtor, you’re relying on them to have properly valued their property, and this can cause you serious issues when it comes time to get your loan. In a worst-case scenario, you could run into problems after a home is under agreement, a seller has accepted your offer, and your assets are tied up.
Now imagine if the appraiser comes along and says the value is less than the asking price, the lender refuses to loan you that amount, and the seller refuses to come down from their price. It can take weeks or even months to straighten everything out and get back on track. If you’re trying to sell a home at the same time, all this can really ruin your life. With a realtor, you have someone on your side to help you avoid this issue and ensure you don’t get entangled in a bad deal.
You Deal With the Paperwork Yourself
Real estate paperwork is some of the most complex you’ll ever see in your life. Home loan papers alone can run to hundreds of pages, and that’s not counting everything you’ll have to file with the city, county, and state. Every single piece of paper must be filed at the right time, accurately filled out, and correctly done. If you miss anything, you could be in for some very serious and expensive issues down the line.
Without a realtor on your side, you’re taking an enormous risk unless you hire a real estate lawyer to do it all for you. And while a lawyer can help you with the legalities and paperwork, a lawyer can’t help you with any other aspect of your buying process like a realtor can.
You May Find Negotiations Tricker Than You Think
Most of us are best at the skills we practice regularly through our education, hobbies, and job experience. Since most jobs don’t require a lot of negotiation on the level needed to navigate a property sale, the average buyer doesn’t have much skill in this area.
Now consider your realtor. A realtor has to enter into negotiations for every client they help. They’re doing this every day and building their skills month by month and year by year. A realtor knows how to negotiate, but more importantly, a realtor also knows what factors influence the value of a home and how to present these to the seller in a way that gets a response.
Don’t Take the Risk of Buying a House Without a Realtor
Buying a home is one of the biggest transactions you’ll ever undertake in life, and it’s too big to be left to chance. Don’t take the risk: contact Teresa Mack today and get LA’s premier real estate expert working on your side.