Won't I Save Money Working With The Listing Agent?
This is another misconception many have and still believe in. You aren't being represented doing this. That, in itself, could actually cost you money!
When an agent lists a property they owe a fiduciary duty to the seller. If they also find the buyer on the property, they are now considered a Dual Agent and cannot give fiduciary duties to either party. The agent is now more of a liaison, just trying to get a contract accepted by both parties without giving either one full representation.
This is legal in Illinois (although illegal in many other states) but why would a buyer want to do this? Some buyers feel that the agent will drop their commission, enabling the buyer to make a lower offer. The listing commission is between the agent and the seller and a contract was already signed when the property was listed. If commission is going to be reduced, the seller wants this reduction in their pocket - not yours.
Maybe you think because you're working with the listing agent they'll tell you the seller's bottom line. If they did, they'd be breaking our Code of Ethics and Standard of Practices and if the seller found out they could sue the agent. Do you think an agent would want to take this risk?
The truth is, I rarely know my seller's bottom line until an offer is made. Sometimes I'm surprised that it was much lower than I anticipated. Sometimes I'm taken aback when they won't budge from the list price at all. I rarely have any insider information and I certainly can't pass it along to a buyer if I'm acting as a dual agent.
Another thing to keep in mind is that a dual agent wants to sell this listing to you. You are not going to be told if the property is overpriced. You will not be offered a Comparable Market Analysis (CMA) so you can compare prices of similar homes. What if you demand a CMA? The listing agent can certainly manipulate the findings and how would you know?
Can you bring in another agent for their opinion? We work on commission only. If you ask another agent for their opinion on a purchase they are not involved with, be prepared to pay an hourly or flat fee for this service.
I have been a dual agent. I don't like it and have never felt comfortable with it. My sellers feel I'm not giving them full representation, and they're right. (Of course, all parties have to sign an agreement to accept the dual agency). The buyers feel they're not being represented, and again, they're right. Dual agency does not allow representation.
Find an agent you trust and are comfortable with and stick with that agent. Don't call the listing agent for information, get it from your agent. Let your agent make your calls for you and do the searching. If you want to visit an open house, let your agent know and ask them to attend with you.
You want and deserve full buyer representation when making what is probably going to be the biggest investment of your life. Every seller has their own bottom line. There is no guarantee that any agent can save you "x" amount of dollars off the list price of a home. But you do have a better chance of saving money by working with one agent that is representing you.
I hope this explains to you how important full Buyer Representation is. If you have any further questions please call me at 708-536-8200 or Contact Me.