Shady sellers agent

hello

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My friend is looking at a house.  She was thinking of using the sellers agent as her buying agent also.  What does she need to look out for?  She thinks the selling agent is kinda shady, but wants to use him because she thinks she can get the house for a better deal.

 
hello said:
My friend is looking at a house.  She was thinking of using the sellers agent as her buying agent also.  What does she need to look out for?  She thinks the selling agent is kinda shady, but wants to use him because she thinks she can get the house for a better deal.

What type of discount is that agent giving?
Is it max discount?  ;)

 
I wouldn't recommend it unless the buyer really, really knows her stuff and understands what to look for and what questions to ask. Generally you should always protect your interests by having a different agent represent you. She should trust her gut if she already feels the agent is shady.

Here's an article on how dual agency can go wrong:http://www.ocregister.com/articles/case-736188-dual-ruling.html[Note: slightly different scenario as this is not the same agent representing buyer/seller, rather the same broker. But, the lessons learned are still applicable.].
 
I think the only advantage in having him as a double agent is it would probably increase your chances at getting the property as the agent would essentially be double dipping into both the buy and sell commission so it's in his interest to have you be the final buyer...but of course if he already is shady, can you really trust him to have your interest at all and not jack up the price?

Main question I assume would be ...is this home "the one"? Or are there other choices as well?  Once you get emotional on a primary residence, your friend will likely say yes to everything to get the house
 
I've thought about this before as well.  Let's say I walk into an open house listed for $900k.  I tell the agent hosting the open house that I'd like to make an offer for $850k and I'd like to use them as my buyers agent.  Then let's say later in the day another buyer comes and makes an offer for $875k but has their own buyers agent.

Now, the realtor has to present both offers to the seller:
Offer 1: Mine for $850k (with them as the buyers agent)
Offer 2: Other offer for $875k (with another buyers agent)

Assuming traditional 3%/3% split commission.
Offer 1: Selling Agent receives 6% of $850k ($51,000 total)
Offer 2: Selling Agent receives 3% of $875k ($26,250 total)

I would think the agent will find a way to make Offer 1 look much more attractive to the seller than Offer 2, regardless of the surrounding circumstances... Of course there are always outliers or exceptions, but maybe one of our resident agents can tell us if this typically happens and whether or not this works in the buyers favor.
 
aquabliss said:
I've thought about this before as well.  Let's say I walk into an open house listed for $900k.  I tell the agent hosting the open house that I'd like to make an offer for $850k and I'd like to use them as my buyers agent.  Then let's say later in the day another buyer comes and makes an offer for $875k but has their own buyers agent.

Now, the realtor has to present both offers to the seller:
Offer 1: Mine for $850k (with them as the buyers agent)
Offer 2: Other offer for $875k (with another buyers agent)

Assuming traditional 3%/3% split commission.
Offer 1: Selling Agent receives 6% of $850k ($51,000 total)
Offer 2: Selling Agent receives 3% of $875k ($26,250 total)

I would think the agent will find a way to make Offer 1 look much more attractive to the seller than Offer 2, regardless of the surrounding circumstances... Of course there are always outliers or exceptions, but maybe one of our resident agents can tell us if this typically happens and whether or not this works in the buyers favor.

Im sure this happens much more often then any agent would like to admit.  I dont expect any agent to admit this as it would be completely agents their code of conduct or even that matter, probably against the law.
 
aquabliss said:
I've thought about this before as well.  Let's say I walk into an open house listed for $900k.  I tell the agent hosting the open house that I'd like to make an offer for $850k and I'd like to use them as my buyers agent.  Then let's say later in the day another buyer comes and makes an offer for $875k but has their own buyers agent.

Now, the realtor has to present both offers to the seller:
Offer 1: Mine for $850k (with them as the buyers agent)
Offer 2: Other offer for $875k (with another buyers agent)

Assuming traditional 3%/3% split commission.
Offer 1: Selling Agent receives 6% of $850k ($51,000 total)
Offer 2: Selling Agent receives 3% of $875k ($26,250 total)

I would think the agent will find a way to make Offer 1 look much more attractive to the seller than Offer 2, regardless of the surrounding circumstances... Of course there are always outliers or exceptions, but maybe one of our resident agents can tell us if this typically happens and whether or not this works in the buyers favor.

Typically there is a slight discount when there is dual agency.  Standard is 2.5%/2.5%, but if there is dual agency, typically total commission is 4%.  Still a difference, but not as drastic as your numbers make it seem. 

Buyer needs to make final decision and I would hope they understand the pros/cons of each potential buyer and net sales price.
 
I'll speak as a listing agent who has and is representing buyers on my listings.  First off, I always forward all offers and counters to my sellers no matter what.  There are buyers who actively seek out working with the listing agents as they believe that it will increase their chances of getting the home (this has happened to me several times).  Some of them ask me if I can ask the seller to give them the ability to match the highest offer in a multiple offer situation (which most of my sellers do agree to).  In non-multiple offer situations, I provide relevant closed comps and limit my price/term recommendations as to not provide any one side an unfair advantage.  In my commission structures, the seller definitely does play less total commission if I represent both sides.  A good agent focuses on the long-term and building relationships with their clients, not what they can make on a transaction.  All that being said, as a buyer you have to feel like your agent will go to bat for you and that you can trust them.  Sounds like your friend already has doubts about the listing agent so she might best get her own buyer agent.
 
woodburyowner said:
aquabliss said:
I've thought about this before as well.  Let's say I walk into an open house listed for $900k.  I tell the agent hosting the open house that I'd like to make an offer for $850k and I'd like to use them as my buyers agent.  Then let's say later in the day another buyer comes and makes an offer for $875k but has their own buyers agent.

Now, the realtor has to present both offers to the seller:
Offer 1: Mine for $850k (with them as the buyers agent)
Offer 2: Other offer for $875k (with another buyers agent)

Assuming traditional 3%/3% split commission.
Offer 1: Selling Agent receives 6% of $850k ($51,000 total)
Offer 2: Selling Agent receives 3% of $875k ($26,250 total)

I would think the agent will find a way to make Offer 1 look much more attractive to the seller than Offer 2, regardless of the surrounding circumstances... Of course there are always outliers or exceptions, but maybe one of our resident agents can tell us if this typically happens and whether or not this works in the buyers favor.

Typically there is a slight discount when there is dual agency.  Standard is 2.5%/2.5%, but if there is dual agency, typically total commission is 4%.  Still a difference, but not as drastic as your numbers make it seem. 

Buyer needs to make final decision and I would hope they understand the pros/cons of each potential buyer and net sales price.

That's definitely a more accurate representation of what happens.  When I'm representing both sides, I still provide a commission rebate to the buyer despite the lower buyer agent commission.
 
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