When I was a Realtor, I had a canned stock speech about title insurance that I used, usually at the closing table.
I told the story about a young couple buying their first home in a new subdivision. After they’d been living there a couple years, there was a claim on the title that the land the subdivision was built on wasn’t clear. The chain of title traced back to a Native American tribe, and they filed suit on the basis of this unclear title. The judge sided with the tribe and foreclosed on every homeowner. Those with title insurance got a check for the fair market value of their home at the time, and those who didn’t became homeless for nothing.
No idea if that’s true or if it actually happened… but that’s what I told people who pressed when we were trying to get a deal done.
Riverman’s absolutely correct that everyone involved in a real estate transaction… from lenders to loan officers to underwriters to insurance to attorneys and ESPECIALLY Realtors… desperately needs the deal to close more than the people actually buying the house.
My ex is a realtor. Man they sure are some shameless people.
Our breakup wasn’t good but when she heard I was looking to buy (been renting and travelling the last few years) she called me straight away offering to “help”.
How much commission would she make on a $400k sale? I know when we were together she’d tell me she got cut in on all the action she steered to attorneys and mortgage advisors.
At my parent’s company, the agent kept 70% of the commission and the brokerage firm would get 30%. Once the agent did a certain amount of sales volume in a year, that would go up to 90/10. Re/Max has a commission split model and a flat fee model.
Anybody have any experience buying a house off market (without realtors)?
The neighbors of some friends here in Chicago are selling their house and want to do it without a listing agent.
We’ve never bought a house before and have been working with a realtor to search, but would probably not use her in the process if we buy the house from these people. I’m just not sure how it works when it is lawyers or other people handling all of the transaction paperwork and such rather than a buyer’s and seller’s agent.
Nope. We started looking maybe 18-24 months ago, she took us to like 5-6 showings a while back and one last week after we started looking seriously again. No contract or agreement signed though.
I’ve been on the other side of this transaction, selling without a realtor. I believe in most states it’s easy to get access to a standard real estate purchase agreement to use. The bank financing the purchase will make sure everything is in order prior to closing.
And then for recommending the best mortgage lender mortgage lender who will give them the biggest kickback, they get X more… Plus any other kickbacks.
And of course the way their earning incentives align is stupid. If I’m looking for a house, the more I pay for it, the more my realtor makes. So your own realtor is incentivized to steer you towards overpaying!
But I’m sure, having known you for a few weeks, they wouldn’t screw you out of $20,000 to make an extra $600 for themselves or anything. Or screw you into a higher mortgage rate…
My favorite was when my realtor told me his guy was the best and he’d get me an estimate. I said, “That’s fine, but I’m not locked in right? Cause I’m going to want to compare rates and make sure I’m getting the best one - but of course I’ll give him a chance to match.”
He told me I wasn’t locked in, then went into a long explanation about how it would take longer with anyone else, I might lose the house, I wouldn’t save that much over the life of the loan over a measly few tenths of a percent anyway… L-O-fucking-L. What’s $15K to 25K in extra interest between friends, amirite?
Haven’t done it, but as others have mentioned you can just get a real estate lawyer that you pay hourly to take care of things. It will be much, much, less expensive than a realtor commission unless we’re talking about a really cheap house. And there is no reason to think that things won’t go smoothly. This is what they do.
This makes no difference on the buy side, though, right? Like if I buy a house without a realtor, the whole 6% just goes to the selling realtor, right?
Yes which should be illegal but lol America. You should be able to pay 3% less with no realtor but I think most listing contracts just let the listing realtor keep all 6% if you don’t have an agent, lol realtors.
Not sure I understand the question as it sounds like there are going to be no realtors involved in this scenario.
If the seller isn’t going to have to pay 6% in commissions, then they can accept a lower price from the buyer and still come out ahead. Everybody wins.
It also depends on how your contract with the realtor is written. Some will specify X% to listing agent and Y% to buyer’s agent. X and Y are both commonly 3%, but if there is no buyer’s agent, then seller could structure it so that so they just pay X% and not the full 6%.