Questions to Ask a Buyer's Agent
Be sure you choose a Buyer's agent that will help you through a successful home purchase.
Here are questions to ask a prospective agent about representing you to buy a home.
Questions Buyers Should Ask in Agent Interviews
- Do you work full-time or part-time as a REALTOR®?
Full-time work typically means more attention for you.
- How well do you know the area(s) I am interested in?
A REALTOR® who specializes in the area that you are interested in is preferable. He or she will be able to advise you as to home prices and how quickly you'll need to act based on the demand in that area.
- How many other buyers are you representing now?
The busiest REALTORS® are often the most efficient.
- Will you handle all aspects of my transaction or will you delegate some tasks to a sales associate or administrative assistant?
A knowledgeable assistant can be invaluable, but make sure that you can connect with your REALTOR® when you need to.
- Can you give me a Comparative Market Analysis (CMA) of recent sales in the area and homes currently on the market?
This should contain listing and sales prices for recently sold homes as well as listing prices and the listing dates of homes currently for sale. It also should include detailed property descriptions (such as square footage and numbers of bedrooms and baths).
- Can you provide me with information on the area?
Your REALTOR® should have access to information on local schools, community services, transportation, shopping etc.
- Is your license in good standing?
You should check a REALTOR'S® certification yourself with your state's department of real estate. Many states provide this information online. For example, in Virginia, residents may check at http://www.dpor.virginia.gov
- How many years of education and experience do you have?
Experience and continuing education typically make for better REALTORS®
- Are you also a broker and/or a REALTOR®?
Brokers have more stringent licensing requirements and responsibilities. REALTORS® are voluntary members of the National Association of REALTORS®, a trade group.
Smart consumers interview potential real estate agents before deciding on whom to hire. Just as you are sizing up the potential for a good fit, rest assured that the real estate agent will likely be interviewing you, too. Be wary of agents who don't ask you questions and probe for your motivation. You wouldn't work with just any agent off the street, and good agents are just as selective about their clients, too.
Caution: Don't interview agents from the same company!
1. How Long Have You Been in the Business?
The standard joke is there's nothing wrong with a new agent that a little experience won't fix. But that's not to say that freshly licensed agents aren't valuable. Much depends on whether they have access to competent mentors and the level of their training. Newer agents tend to have more time to concentrate on you. Some agents with 20 years of experience repeat their first year over and over. Other 20-year agents learn something new every year.
2. What is Your Average List-Price-to-Sales-Price Ratio?
Knowing the agent's average ratio speaks volumes. Excluding sizzling seller's markets, a good buyer's agent should be able to negotiate a sales price that is lower than list price for buyers. A competent listing agent should hold a track record for negotiating sales prices that are very close to list prices. Therefore, listing agents should have higher ratios closer to 100%. Buyer's agent ratios should fall below 99%.
3. What is Your Best Marketing Plan or Strategy for My Needs?
As a buyer, you will need to know:
- How will you search for my new home?
- How many homes will I likely see before I find a home I want to buy?
- Will I be competing against other buyers?
- How do you handle multiple offers?
- Do you present offers yourself?
5. What Are the Top Three Things That Separate You From Your Competition?
A good agent won't hesitate to answer this question and will be ready to fire off why she is best suited for the job. Everyone has their own standards, but most consumers say they are looking for agents who say they are:
- Honest and trustworthy
- Assertive
- Excellent negotiators
- Available by phone or e-mail
- Good communicators
- Friendly
- Analytical
- Able to maintain a good sense of humor under trying circumstances
6. May I Review Documents Beforehand That I Will Be Asked to Sign?
A sign of a good real estate agent is a professional who makes forms available to you for preview before you are required to sign them. If at all possible, ask for these documents upfront.
As a buyer, ask for copies of the following:
7. How Will You Help Me Find Other Professionals?
Let the real estate agent explain to you who she works with and why she chooses these professionals. Your agent should be able to supply you with a written list of referring vendors such as
mortgage brokers, home inspectors and
title companies. Ask for an explanation if you see the term "affiliated" because it could mean that the agent and her broker are receiving compensation from one or all of vendors, and you could be paying a premium for the service.
8. How Much Do You Charge?
Don't ask if the fee is negotiable. All real estate fees are negotiable. Typically, real estate agents charge a percentage, from 2% to 4% to represent one side of a transaction: a seller or a buyer. A listing agent may charge, for example, 3.5% for herself and another 3.5% for the buyer's agent, for a total of 7%.
9. What Kind of Guarantee Do You Offer?
If you sign a listing or buying agreement with the agent and later find that you are unhappy with the arrangement, will the agent let you cancel the agreement? Will the agent stand behind his service to you? What is his company's policy about canceled agreements? Has anybody ever cancelled an agreement with him before?
10. What Haven't I Asked You That I Need to Know?
Pay close attention to how the real estate agent answers this question because there is always something you need to know, always. You want an agent to take his time with you -- to make sure you feel comfortable and secure with his knowledge and experience. He should know how to listen and how to counsel you, how to ask the right questions to find out what he needs to know to better serve you.
It's not enough to know which questions to ask your agent. The answers to those questions are how you will figure out which agent to hire. Below are the best answers to each question.
1. How Long Have You Been in the Business?
While I am not suggesting that you hire some aging geezer with a cane, experience does count. It can mean the difference between knowing how to handle a difficult situation to ignoring it or not recognizing the signs of a potential problem before it develops into a crisis. Minimum of five years' experience.
2. Average List-to-Sales-Price Ratio
When hiring a buyer's agent, expect to see list-to-sales ratios within 90 to 97% in a buyer's market; in a seller's market: 100% to 103%.
3. Best Marketing Plan / Strategy
As a buyer, you should expect to see 5 to 7 homes a day, for as long as it takes to
find your home. All the homes should fit your parameters, and the agent should preview those homes for you. The agent should also agree to solely represent you and not represent other buyers who are competing for the same inventory.
As a seller, you would like your agent to advertise weekly for you, do direct mail, send e-flyers, produce four-color brochures, and present you with a marketing campaign designed specifically for you.
4. Top Three Things That Make the Agent Different
Examples can range from marketing to knowledge. Acceptable answers are:
- Strong repeat record of satisfied customers
- Extensive online marketing
- Good negotiation skills
- Assertive, doesn't take no for an answer
- Strong communicator.
5. Review of Documents
As a buyer, ask to see a sample
purchase agreement and ask the agent to point out your cancellation rights in this document. If the agent hems and haws, or hesitates to explain the purchase agreement to you, hire another agent.
As a seller, ask to see the listing agreement. Ask about reserving the right to sell the home yourself. If you see a fee you do not understand, question it.
6. Affiliation with Related Professionals
Ask the agent if the
title company she recommends charges competitive fees. All agents build teams of professionals, from title companies to escrow officers to
mortgage lenders,
home inspectors and appraisers. Ask if the agent's company is receiving compensation for the referral. If so, you might want to choose another professional. Payment of some referral fees are against the law.
7. Agent Fees
All fees are negotiable. If you are a buyer, ask the agent if the fee stated in the Buyer Brokerage Agreement will be adjusted if the offered seller's compensation is lower.
8. Personal Guarantee
If the agent will not release you from a listing agreement prior to its expiration upon request, then you should hire another agent. Ask about it before you sign a buyer's broker agreement. Some agents will release you; others will not.
9. Other Questions
You might ask the agent to reiterate your goals and objectives. If the agent does not appear to have a thorough understanding of what you want, despite your attempts to explain what you want, then hire somebody else. Some agents do not listen very well. You want an agent who will listen to you and communicate with you. The best way to find out if the agent comprehends your desires is to ask the agent to repeat it back to you.