5 reasons you still need a real-estate agent

You might think buying or selling on your own will save money, but it could be more costly in the long run.

The proliferation of services that help home buyers and sellers complete their own real-estate transactions is relatively recent, and it may have you wondering whether using a real-estate agent is becoming a relic of a bygone era. While doing the work yourself can save you the significant commissions that many real-estate agents command, for many, flying solo may not be the way to go — and could end up being more costly than a commission in the long run. Buying or selling a home is a major financial and emotional undertaking. Find out why you shouldn't discard the notion of hiring an agent just yet.

1. Better access/more convenience
A real-estate agent's full-time job is to act as a liaison between buyers and sellers. This means that he or she will have easy access to all other properties listed by other agents and will know what needs to be done to get a deal together. For example, if you are looking to buy a home, a real-estate agent will track down homes that meet your criteria, get in touch with sellers' agents and make appointments for you to view the homes. If you are buying on your own, you will have to play this telephone tag yourself. This may be especially difficult if you're shopping for homes that are for sale by owner.

Similarly, if you are looking to sell your home yourself, you will have to solicit calls from interested parties, answer questions and make appointments. Keep in mind that potential buyers are likely to move on if you tend to be busy or don't respond quickly enough. Alternatively, you may find yourself making an appointment and rushing home, only to find that no one shows up.

2. Negotiating is tricky business
Many people don't like the idea of doing a real-estate deal through an agent and think that direct negotiation between buyers and sellers is more transparent and allows the parties to look after their own interests better. This is probably true — assuming that both the buyer and seller are reasonable people who are able to get along. Unfortunately, this isn't always an easy relationship.

What if you, as a buyer, like a home but despise its wood-paneled walls, shag carpet and lurid orange kitchen? If you are working with an agent, you can express your contempt for the current owner's decorating skills and rant about how much it'll cost you to upgrade the home without insulting the owner. For all you know, the owner's late mother may have lovingly chosen the décor. Your real-estate agent can convey your concerns to the seller’s agent. Acting as a messenger, the agent may be in a better position to negotiate a discount without ruffling the homeowner's feathers.

A real-estate agent can also play the “bad guy” in a transaction, preventing the bad blood between a buyer and seller that can kill a deal. Keep in mind that sellers can reject a potential buyer's offer for any reason — including just because they hate his or her guts. An agent can help by speaking for you in tough transactions and smoothing things over to keep them from getting too personal. This can put you in a better position to get the house you want. The same is true for the seller, who can benefit from a hard-nosed real-estate agent who will represent his or her interests without turning off potential buyers who want to niggle about the price.

3. Contracts can be hard to handle
If you decide to buy or sell a home, the offer-to-purchase contract is there to protect you and ensure that you are able to back out of the deal if certain conditions aren't met. For example, if you plan to buy a home with a mortgage but you fail to make financing one of the conditions of the sale — and you aren't approved for the mortgage — you can lose your deposit on the home and could even be sued by the seller for failing to fulfill your end of the contract. (Keep in mind that the details of any contract may vary based on state law.)

An experienced real-estate agent deals with the same contracts and conditions on a regular basis and is familiar with which conditions should be used, when they can be removed safely and how to use the contract to protect you, whether you're buying or selling your home.

4. Real-estate agents can't lie
Well, OK, actually they can. But because they are licensed professionals, there are more repercussions if they do than for a private buyer or seller. If you are working with a licensed real-estate agent under an agency agreement, such as a conventional, full-service commission agreement in which the agent agrees to represent you, your agent will be bound by law to a fiduciary relationship. In other words, the agent is bound by law to act in his clients' best interest, not his own.
In addition, most real-estate agents rely on referrals and repeat business to build the kind of client base they'll need to survive in the business. This means that doing what's best for their clients should be as important to them as any individual sale.
Finally, if you do find that your agent has gotten away with lying to you, you will have more avenues for recourse, such as through your agent's broker or professional association or possibly even in court if you can prove that your agent has failed to uphold his fiduciary duties.
When a buyer and seller work together directly, they can — and should — seek legal counsel, but because each is expected to act in his or her best interest, there isn't much you can do if you find out later that you've been duped about multiple offers or the home's condition. And having a lawyer on retainer any time you want to talk about potentially buying or selling a house could cost far more than an agent's commissions by the time the transaction is complete.

5.  Not everyone can save money
Many people eschew using a real-estate agent in order to save money, but keep in mind that it is unlikely that both the buyer and seller will reap the benefits of not having to pay commissions. For example, if you are selling your home on your own, you will price it based on the sale prices of other comparable properties in your area. Many of these properties will be sold with the help of an agent. This means that the seller gets to keep the percentage of the home's sale price that might otherwise be paid to the real-estate agent.
However, buyers who are looking to purchase a home sold by owners may also believe they can save some money on the home by not having an agent involved. They might even expect it and make an offer accordingly. However, unless buyer and seller agree to split the savings, they can't both save the commission.


The bottom line
While there are certainly people who are qualified to sell their own homes, taking a quick look at the long list of frequently asked questions on most “for sale by owner” websites suggests the process isn't as simple as many people assume. And when you get into a difficult situation, it can really pay to have a professional on your side

6 Things Homebuyers Should Avoid Once They are Preapproved for a Mortgage

You have done the hard part in the home-buying process and chosen a lender and a real estate agent to work with. You have also gone out and found the home of your dreams! Best of all, your team has done a great job of negotiating the best deal for you.

Now, as a buyer, all you have to do is sit back and wait for your loan to close … right? Wrong!!

Getting a home loan these days is a very interactive process. I am always amazed by how many clients I work with who come to me unaware of all the pitfalls they face during the loan process. To help avoid any surprises while waiting for final approval, I provide my clients with a short list of "do's and don'ts" to follow.

Let's start with the "do's" ...

1. Do keep the process moving by responding to your loan officers' requests for documentation as soon as possible.
2. Do make decisions as soon as is reasonably possible.
3. Do convey questions or concerns you
4. Do continue to make all of your rent or mortgage payments on time.
5. Do stay current on all other existing accounts.
6. Do continue to work your normal work schedule with no unplanned time off.
7. Do continue to use your credit as normal.
8. Do be prepared to explain any large deposits in your bank accounts.
9. Do enjoy purchasing your home but remain objective throughout the process to help make decisions that are best for you.

After you have been preapproved for your mortgage you will want to refrain from the following...

1. Do not make any major purchases (car, boat, jewelry, furniture, appliances, etc.).
2. Do not apply for any new credit (even if it says you are preapproved or "xxx days same as cash").
3. Do not pay off charges or collections (unless directed by your loan officer to do so).
4. Do not make any changes to your credit profile.
5. Do not change bank accounts.
6. Do not make unusual deposits into your bank accounts or move money around from one account to another.

Follow these simple rules and you will help to make your loan closing as smooth and hassle-free as possible! Good luck! 

How to Help Your Appliances Last Longer

Is it just me or does it seem that appliances don’t last as long as they’re supposed to?

Our dryer died after 11 years (two years before a typical dryer’s lifespan is up), and we repaired our refrigerator three times before it reached its 12th birthday (it’s supposed to live for 13 years).

Full disclosure: I wouldn’t give myself an A in appliance care. But in the future, I vow to keep up on regular maintenance that’ll keep my new dryer running longer than my last one.

Rob Carpenter, owner of a Mr. Handyman franchise in Maryland, shares some insider tips about how to extend the life of home appliances.

Refrigerators That Last

Refrigerators break down when doors don’t close tightly, forcing motors to work overtime to keep food cold. To test your door seal, close the door on a dollar bill: If the bill slips, you’ve got a problem that requires refrigerator maintenance.

Magnetic strips embedded in gaskets around refrigerator doors make doors close snugly, but they routinely wear out and should be replaced or re-magnetized every couple of years. If you’re handy, re-magnetizing is a DIY job — just run a powerful magnet along each side of the gasket, in the same direction, about 50 times.

If messing around with the refrigerator door is beyond your pay grade, call a professional. Pros typically charge around $242 to repair door problems.

Washing Machine Endurance

Loose change banging around your washer drum can cause dents, chipped paint, and rust, so make sure to empty pockets before washing clothes.

Also, maintain your washing machine by regularly cleaning or replacing filters that trap water sediment before it enters your machine. Filters, which look like thimbles, are located in the back where supply hoses attach to the machine. Remove hoses and either poke out debris with a tip of a flathead screwdriver, then remove and wash the filter, or replace it.

Dryers That Keep on Drying

In addition to regularly cleaning out your dryer’s lint trap and exhaust hose, inspect the exterior vent — hot air must escape your house unimpeded.

Make sure the hinged exterior vent pops open when the dryer runs. If it doesn’t, open the cover and scrape out lint with the end of a hanger or dryer vent brush ($13). If your vent is louvered, clean slats with an old toothbrush.

Dishwasher Extenders

Here are ways to keep your dishwasher stress-free and long-lasting:

• Prime your dishwasher by running the hot water in your sink before you begin the cycle. This will clean your dishes with hot water from the very start of the cycle.

• Once a week, run your dishwasher empty except for a cup of vinegar, which will keep it shining and smelling fresh.

• Clean out food traps regularly.

• Wipe clean the seals around dishwasher doors.


Toaster Thoughts

Darkly toasted bread will burn out your toaster two years earlier than lightly toasted bread. So if you can live with lightly crisp rather than almost burnt, you’ll get a few more years out of your toaster.