It can be tempting to buy a home without hiring a real estate agent. If you can save the 3 percent fee, why not try to do it on your own, right? Wrong.
Attempting to purchase a home on your own can present many risks that can damage your bank account, your chance at a dream home and future investments. Keep reading to learn more about the numerous risks of buying a home without using a real estate agent.
Overpaying for a Home
Are you knowledgeable about local market trends and home appraisals? If the answer is no, there is a good chance you will overpay on a home if you don't have a real estate agent guiding you.
In most cases, homes that are listed For Sale By Owner (FSBO) are overpriced. Sellers can easily overestimate the value of their home, and if you aren't aware of that, you'll end up paying more than the actual value.
Lack of Neighborhood Knowledge
Many real estate agents specialize their services to specific neighborhoods or communities. Because of this, they usually know the ins and outs of an area more than most. They're knowledgeable about what other properties in the area are selling at, how a home's value may increase or decrease in the future, school ratings, safety and more.
Having a real estate agent on your team will be a great asset if you're looking into buying a home in a neighborhood you are not familiar with. After all, you're not just purchasing a home, you're investing in your future.
Misunderstanding of Laws, Regulations and Contracts
The real estate industry is full of laws and regulations that vary by state, city and county. Without an agent, you won't have someone to be there with you every step of the way to explain the process to you and make sure everything is legal. Nobody wants to be blindsided by a seller who wasn't abiding by the laws, and you certainly don't want to be the one breaking the law yourself.
There will also be mountains of contracts and other paperwork to go through.Real estate jargoncan be confusing, and it is good to have a trusted agent who can explain any terms to you. It is also imperative to ensure that deadlines are met and any paperwork is filled out correctly. If you make mistakes during this step, it can cause serious, expensive issues down the road.
Buyer's agents are well-versed when it comes to inspections. They understand what type of inspections are necessary and which inspectors can get the job done. If you try booking an inspection without an agent, you may end up purchasing a house with serious problems or spending too much money on unreasonable inspection requests.
Overpaying on Closing Costs
Closing costs can already be confusing and present last-minute fees you didn't realize you'd have to pay. You don't want to end up footing the bill for all closing costs just because you didn't know any better. If you are represented by an agent, they can break down and explain the amount of your closing costs, and they can negotiate with the seller what you will cover and what the seller will cover.
To avoid these risks, find a trusted real estate agent here. As long as you do proper research and interview prospective agents, you'll find the right fit for you! For more advice during the buying/selling process, visit www.crye-leike.com/blogs.