Home owners often consider selling their home for a variety of reasons. They may be seeking to move into a different area, get out of debt or their living situation has changed and the current home can no longer accommodate their needs. When selling a home, no matter what the reason for the sale may be, the object is to get the most money back on your original investment. Knowing what real estate brokers and agents can do to help you is the first step towards a successful home sale.
What is a Real Estate Broker?
To put it in the simplest terms, a real estate broker assists real estate sellers and buyers in finding each other and completing the sale transaction. As licensed professionals, the real estate broker has been trained in the legal filings needed for the sale of property. Sellers sign a listing agreement with real estate brokers that provides for the broker to include the property in their lists of available properties which are for sale in exchange for a commission (a portion of the sale price) being paid to the broker when the sale is realized. These brokerages are usually divided into two classes; traditional and non-traditional.
What is a Real Estate Agent?
Real estate agents are also licensed professionals who have been trained in the legal proceedings surrounding home and property sales. Working under the direction of a real estate broker, the real estate agent collects a portion of the real estate broker’s commission off of any sales they directly participate in by showing houses to buyers or signing new sellers.
Traditional vs. Non-Traditional Brokerages
Since not every home selling transaction is the same, your home sale may not require all of the same services as another sale may. Due to this fact, real estate brokers provide a wide range of services to ensure that every home seller’s needs are met. While some real estate brokers -known as traditional brokerages- provide full services under a blanket contract at a premium price, other real estate brokers -known as non-traditional brokerages- offer these services in packages or as options to your contract.
The traditional brokerage handles every matter involved with the sale. They assist with getting the property ready for sale, suggest property values and asking prices to the seller, introduce the property to prospective buyers, negotiate between prospective buyers and the seller and finalize the sale through legal contracts. In exchange for this extra attention and work, the traditional brokerage usually claims a higher percentage of the sale price as payment for the services rendered.
Non-traditional brokerages, on the other hand, offer a wider variety of optional services. While it is still possible to get all of the same services provided by a traditional real estate brokerage, the non-traditional brokerage offers each of these services as a separate option for a specific price. For those who can handle the majority of their home sale needs themselves, the non-traditional brokerage may save them a significant amount of money when compared to paying the commissions demanded by traditional brokerages. Inversely, if the seller needs assistance with almost every factor involved in the sale of the property, they may actually pay more by opting to pay for each of the non-traditional brokerage’s services individually rather than paying a blanket rate charged by traditional brokerages.
When choosing the type of brokerage you need for your particular sale, you should ask yourself a few questions. Does the property require any special conditions to the sale? Can you show the property to prospective buyers on your own or do you need a real estate agent to meet with prospective buyers? Are you able to negotiate prices with prospective buyers? Can you handle the legal aspects of the sale contract or do you need the real estate broker to assist with this service? If you can handle most or all of these requirements on your own, then you may benefit from signing with a non-traditional brokerage firm or even listing your home as For Sale By Owner (FSBO) on a Multiple Listing Service (MLS). If you feel that you cannot personally see to all of these tasks, a traditional real estate broker might be better suited to your needs.
Choosing a Real Estate Broker
Once you know what kind of real estate brokerage you need, the next step is finding one that fits your need. While it is not uncommon for home owners to list their property with the first real estate broker they approach, it may save you money in the long run if you do a bit of research and talk to several real estate brokers in your area before signing a listing agreement. When signing with a real estate broker, be sure to ask questions to determine if there are additional fees and commissions for services such as home inspections, MLS listings, closing the sale or removing your home from the market. Reputable brokers and agents will be happy to answer any questions and they will put things in writing.
As the saying goes, “An ounce of prevention is worth a pound of cure”. Get to know your local real estate broker options. Ask friends and family members who handled the sale of their property and how their personal experience went. Look online at reviews offered by home sellers who used the services of a particular real estate broker. Ask the broker for references. By dong this, you may save yourself a lot of headaches dealing with real estate brokers and agents who don’t have a good track record of successful sales and satisfied customers.
Once you have decided upon a real estate broker, signing the listing agreement is the next step. Before signing, make sure that you understand all of the wording in the paper because it is a legally binding contract. If you do not understand, ask the real estate broker or your attorney to explain it to you. Also be sure that the listing agreement includes any oral agreements you may have with the broker and a clause for termination of the broker’s services should you become dissatisfied with their services at a later date.
Selling your home can be a stressful time, full of legal and monetary pitfalls. Understanding how real estate brokers, agents and listings work can save you a lot of time, trouble and money.