General Question

AshlynM's avatar

How do you know if a real estate agent is legit and being honest with you?

Asked by AshlynM (6380 points ) April 9th, 2010

What are some odd behavior and warning signs to look out for?

Also, is there a difference between realtor and real estate agent?

Observing members: 0 Composing members: 0

46 Answers

PandoraBoxx's avatar

Real estate agents are paid their commission by the seller of the property. The commission rate is negotiable, but is generally 7%.

Are you a buyer or a seller? If you’re a buyer, you don’t need an agent to represent you, the selling agent can do both. As a buyer, keep in mind—caveat emptor. Let the buyer beware. Read everything. Have an independent home inspection, spend time in the area of the home without the realtor at night or on the weekend (that’s when you find out about the airplanes that go overhead at night or the problematic neighbors.)

I have never heard of anyone complain about “odd behavior” but not all agents have the connections to move houses. Some are better at their job than others.

AshlynM's avatar

I’m a potential buyer…I don’t have much experience with real estate agents. I was just wondering how to protect myself in case of a scam artist hanging me out to dry and running off with my money.

Cruiser's avatar

I would get your own agent as using the sellers agent creates what is called dual agency and that agent must somehow represent both parties best interests…not always an ideal situation. All agents are licensed by the state they work in so they should all be pretty honest and forthright. I would go with a Real Estate Broker who has more training that a Realtor Salesperson. Find one that is not uber busy but does work full time would be my recommendation. Look for a company that has a big name in the area and most will show the “Realtor” Sign that shows they are legit.

Skippy's avatar

The phrase Realtor is a designation of an agent or broker who is a member of the National Association of Realtor’s. Anyone who sells real estate, be it an agent or broker would be considered “an agent”

By using your own agent as a buyers agent, your best interest is in better hands than only going thru the sellers agent. The commission is standard, and would then be shared by the two agents.

Ask a friend or neighbor who has recently bought or sold for a recomendation of an agent they have had experience with.

PandoraBoxx's avatar

If you are the buyer, find yourself an agent to represent you. You will not have to pay them; they will split the sellers commission with the listing agent.

JeffVader's avatar

I always apply this test….... are their lips moving? If so, then they’re lying.

Cruiser's avatar

@JeffVader She is asking about Realtors not Senators!;)

snowberry's avatar

We’ve had some dishonest ones. We were bidding on some property, and just as we were about to sign, he said someone else had put in a bid for the same property $5000 higher than ours (meaning that we were supposed to up our bid). We did some checking (had a friend who’s a real-estate agent who checked out his claim). Our “competitor” turned out to be our own real estate agent!

Cruiser's avatar

@snowberry If that was the case then both your friend could be sued for that kind of disclosure of confidential and the Real estate agent for not disclosing his bidding on the same property. He should have removed himself as your agent.

dpworkin's avatar

They are asleep and their lips are not moving.

JLeslie's avatar

If you are the buyer I recommend using an agent, because you pay nothing more. The majority of residential real estate contracts are for about 6%, if the buyer has no agent the seller still pays 6% and the listing agent gets the whole thing. If you have your own agent, the sellers agent gets 3% and the buyers agent gets 3%, so the seller is still paying out the same amount of money, and you pay nothing. Having access to the MLS is the best way to know what is on the market, so working with a realtor they will have access to that, athough all listing are on realtor.com, BUT again you will be calling an agent anyway to see the property.

It varies by state…in FL if the listing agent has both sides of the contract they have must be or transition to being a “transaction agent” which means they are loyal to the transaction, and equally loyal to both the seller and the buyer. Some states still have it that the agent is always representing the seller.

Realtors are simply licensed real estate sales people or brokers who have also joined the realtors association. To be a realtor you are required to follow a certain code of ethics, but mostly it also gives the person access to the MLS and other tools for selling property like sales contracts and other forms.

JLeslie's avatar

Also, you should be able to look up any licensed real estate agent on line in your state, under the professional licenses on your states website. There should be a place to see if there has ever been a complaint about the agent. If you are a first time homebuyer, you might want to find someone who specializes in that, if it exists where you live. They typically are more helpful in explaining every step. I have to say in Florida I generally had a good experience with realtors, and eventually decided to become one myself. When I moved to Memphis, I was so disgusted I did not get my license here.

thriftymaid's avatar

Being a Realtor only means that agent is a member of the Board of Realtors. Not all agents are. You can call your state real estate commission if you have questions about the legitimacy or licensing of an agent.

Warning signs to look out for as to the honesty of an agent? Just use whatever life skills you have.

silverfly's avatar

@PandoraBoxx You will have to pay him/her. And you’ll have to pay the loan broker as well. All of this comes out of the settlement amount which is paid back over time through your mortgage payments. The seller typically pays for a big chunk of that though.

john65pennington's avatar

Can a real estate agent be compared to a car salesman? has it come to that point in America?

JLeslie's avatar

@silverfly No. I have never heard of a buyer paying a real estate agent when buying residential property.

Cruiser's avatar

@JLeslie Yes you can have a Realtor represent you in a for sale by owner transaction where you would pay the Realtor’s fee for their services. It is not often but I have seen that occur with busy and or out of town buyers who need a home pronto and who want to see any and all available property and need a professional to seek out these homes.

CyanoticWasp's avatar

No matter what representation you get, whether you have what is called a Buyer’s Agent or not (and for the record, I did on my last home purchase, and always will again—she helped tons in finding the places I was interested in, no matter who was selling, and in negotiating the offer, right up to closing—still a good friend), get a good home inspector.

You can find Home Inspectors in the Yellow Pages or get recommendations from friends who have used them. They will finding things about the property that the seller “should be” disclosing (maybe they just ‘forgot’, or ‘didn’t think it mattered’) and they will probably find things about the property that even the seller isn’t aware of.

thriftymaid's avatar

@JLeslie Buyers may certainly contract with agents and pay a commission.

JLeslie's avatar

@Cruiser Sale by owner I would get a lawyer to do the contracts, what more do you need than that? Many for sale by owner sellers are still willing to pay a commission if a realtor brings a buyer. I would never pay a realtor if I were a buyer. Maybe it happens in some states, but that doesn’t sound good to me. The biggest part of the buyer’s realtors job is to FIND the perfect house for you. Then they follow the contract, make sure all contingencies are met, to make sure it does not fall apart.

@thriftymaid I have honestly never seen that, except back in the day there were some services that a person who needed to rent an apartment might pay a finders fee, but even that I have not seen in a long time, usually the realtor even in that case is solely paid by the landord now.

Maybe it varies by state.

thriftymaid's avatar

@JLeslie No it is more prevalent now with changes in agency law. Agents must disclose with which party the agency exists. If they are in agency with both parties, that must be disclosed in writing to each party. I’ve held a license 35 years and am an attorney. You are right that 20 years ago, the agency was always between the seller and agent and caveat emptor applied to the buyer. That has changed.

JLeslie's avatar

@thriftymaid That is not what I said above. In FL, that is where I am licensed, you can be a sellers agent, or a buyers agent or a transaction agent, but they are all paid by the seller. If you are originally contracted as the seller’s agent, but you bring the buyer, then you have to transition to transaction agent in writing, making both the seller and buyer aware. Many of us were simply transaction brokers to begin with, not needing to transition. Either way the seller is paying.

When I had moved back to FL in 2000 the realtor helping us (I was not a realtor then) had taken us around for several days. Anyway, we were interested in looking at a new community, and the builder did not coop (which sucked for her, because believe me the builders were making hand over fist back then) and she was just SOL on the deal. Made nothing.

JeffVader's avatar

@john65pennington Hehehe, yeh, in the UK they both occupy the position of bottom-feeders. I cant think of many more disliked professions thats for sure.

Cruiser's avatar

@JLeslie If you read my answer you would see why “someone” not necessarily “you” as I did not say @JLeslie I said…

“It is not often but I have seen that occur with busy and or out of town buyers who need a home pronto and who want to see any and all available property and need a professional to seek out these homes.”

It does happen…ask any Realtor…It even happened to me twice!

thriftymaid's avatar

@JLeslie I’ve seen the same type thing happen. What you call a transaction agency is called dual agency in my state (which is next to yours). An agent may still be contracted by a buyer and the buyer pay a commission. In some cases an agent may earn two commissions on one sale. The key is disclosure.

JLeslie's avatar

@thriftymaid In FL we like to think that Dual Agency is illegal and that is why we are transaction brokers. At least that is how they teach it :). Our fiduciary responsibility is diminished to both the buyer and seller as a transaction broker, again the loyalty is to the deal. I think it is just different in your state. Obviously, if you are a lawyer and agent you know what you are talking about, I am not questioning your knowledge, just saying it is different where I come from, and where I am now. I am in TN, I have not heard of a buyer paying an agent directly.

@Cruiser We dealt with out of state buyers all of the time, I am talking about Florida. Investors, people who wanted second homes, people being transferred.

I was a realtor, and I am still licensed.

Cruiser's avatar

@JLeslie I thought I was pretty clear in that I was referring to busy and or out of town buyers who need a house pronto…I’m sorry I did not see the Florida reference you now refer to and don’t see how that changes anything cause even in Florida a busy and or out of town buyer may want to see FSBO’s too if the listed market is particularly lean, then a commission fee would be negotiated. But you are correct that in the know Investor or out of town buyers would probably only need a lawyer if they had the time to source their own purchases.

JLeslie's avatar

@Cruiser Generally if it is a FSBO the realtor would call to see if the seller will pay a commission. Most will. People so dependent on their realtor as you describe, generally would not be searching themselves, and not even come across a FSBO.

Cruiser's avatar

I worked the Chicago market and we had out of towner’s all the time and I did negotiate buyers “fee” contracts when the need arised and I do agree that most times FSBO’s are not part of the routine. But it was my obligation to my busy buyers to find them the best possible home and if a FSBO fit their “needs” better than listed homes I would offer to show it to them and negotiate a services fee. Plus doing so I could work the seller for the best possible price something I couldn’t do if I was to accept a “commission” from the seller.

JLeslie's avatar

@Cruiser So, it is different in IL then. You would not call the seller and see if they would pay you a commission, because I guess whoever is paying is who you are loyal to in your state. In FL I would call the seller, and say I have a buyer who might be interested in yur property are you willing to “cooperate.” The seller usually is because they want their home to get shown.

Also, in the area where I lived most subdivisions would not allow signs in the yard, and we had many gated communities, so there were fewer FSBO’s.

snowberry's avatar

@Cruiser “If that was the case then both your friend could be sued for that kind of disclosure of confidential and the Real estate agent for not disclosing his bidding on the same property. He should have removed himself as your agent.”

If that’s the case, how could I possibly have protected myself? Who would have known? Nobody. I’m certain there are laws against doing what he did, but the fact that my friend told me, and that was illegal, now I’m even more uneasy at the thought of dealing with another real estate agent. They’re showing up like crooks to me, and the law is on their side!!!?!??!!!

Cruiser's avatar

@snowberry You aren’t supposed to know they are! They are the professionals but even professionals will bend the rules for a loved one or friend as they more than likely would never get found out. Realtors have a “Fiduciary” responsibility to their client which legally binds them to protect any and all information germane to their parties transaction and sharing known our found information from the other party however it is obtained is strictly forbidden.

JLeslie's avatar

@snowberry @Cruiser Wait, I don’t get that situation. You are saying your agent put in a bid on a property you were bidding for? Who bought the property in the end?

snowberry's avatar

We were wanting to buy a piece of property, and we started to put ernest money down on it. But before we could, the realtor told us that someone else had put in a bid $$5000 over what we were going to offer. I mentioned this to another realtor who happened to be a friend. She said that something didn’t sound right, so she looked into it. She told me that in fact, the realtor himself was the other bidder.

We dumped that guy so fast he never knew what happened.

JLeslie's avatar

@snowberry But, was your realtor at the time trying to get you to up your bid for the seller? Or, did your realtor actually want the house? That is where I am confused. What his intention was.

snowberry's avatar

Who knows what his intention was? If he really wanted that house, he should have bid on it and not showed it to us. Regardless of whether he was bidding on it for his own, or someone else, to bid on it at the same time as trying to sell it to us was a clear conflict of interest, and just “a tiny bit” against the law.

JLeslie's avatar

@snowberry I agree, total lack of ethics. If he bought it you have proof of the unethical action and you can report him, if you want to.

snowberry's avatar

@JLeslie, If what @Cruiser said (see top) is true, I don’t think I’ll ever want to buy a house again. How will I ever know if I’m being cheated like that or not? I know it’s unethical and unlawful, but how do home buyers protect themselves, if there’s no legal way to find out?

JLeslie's avatar

@snowberry The best is to get someone through a referral. A friend of a friend, that type of thing. What state are you in? Really, for the most part agents are going to behave ethically. They are sales people, true, but most will not jeopardize their license for something like that in my opinion. My experience was much better in FL than it has been in TN though. TN they are more focused on the money. Like I said you can look up their license and see how long they have been licensed and if there are any complaints. Make sure you have recent comps before you put in an offer. I actually made a mistake when I moved to TN, and am going to lose some money in the end because of it. I paid a little too much for my house in retrospect. I am dissappointed the realtor did not guide me better, so I understand your frustration. I knew the market I worked in really well, but was a fish out of water here.

It’s like anything else, how do you know you have a good lawyer, or a good accountant? I had an accountant make a $12,000 mistake on my taxes a several years, I caught it before I signed and sent them in. Luckily, the mistake was so big (an extra $12K in taxes for me is a lot) that it stood out. I don’t know why I bother to pay an accountant I swear. My first time using an accountant here in TN, he sent my paperwork and had not done the TN taxes at all. When I called him, he said, “it shouldn’t add up to much.” WTF kind of answer is that? He did them free of charge, and I did owe some money.

I still don’t understand why he was bidding on the property? If he wanted it he would be better off that you did not bid higher, better for him not to tell you there was another offer. So if he was unscrupulous, well for sure it looks like he is, but he would have bid just a little higher and you would not have had a chance. Or, he thought the seller would not take your original bid so he told you that to up your bid?

snowberry's avatar

I was under the impression he was trying to make a bigger profit off of the sale of the property by artificially pumping up the price. I guess we looked gullible enough he thought we could be taken.

JLeslie's avatar

@snowberry I don’t know any realtor who would do that. An extra $5K on the sale is probably $150 for him, $300 if he had the listing. I don’t know how much the house was, but there is no way he would risk the deal happening for a couple hundred of bucks, Something does not make sense.

snowberry's avatar

Well, I don’t know one either. I dropped him like a hot rock, and he’s been out of my life for 15 years. That was not the only stupid thing he did. He allowed us to put earnest money on another piece of property, but the sign was in the wrong place. The land down the road that was actually for sale wasn’t nearly as nice, so we got our earnest money back. He definitely didn’t have all his marbles.

Response moderated (Off-Topic)
AnnemarieGerald's avatar

Hence in order to find that the real estate agent is legit and being honest you should do some home work before you look at your houses. Ask your relatives or the people surroundigs of you for an agent referral. Ask a potential agent for referrals. And the another most thing is check with your bussiness agency of which any complaints has been filed in the state agency’s that issue real estate license. therefore in order to avoid this choose a reputed and professional agency of which like brampton agency where you can find brampton real estate agents. Hence choosing a reputed agency is your real protection against any frauds.

snowberry's avatar

@AnnemarieGerald Good advice, except for the plug for your company. That’s kind of spammy. See, this website attracts people all over the world. I’d be surprised if any of us were inclined to even look up your business, because we’re so used to spammers.

Also, I don’t take unsolicited advice from strangers over the Internet about how good their business is!

Answer this question

Login

or

Join

to answer.

This question is in the General Section. Responses must be helpful and on-topic.

Your answer will be saved while you login or join.

Have a question? Ask Fluther!

What do you know more about?
or
Knowledge Networking @ Fluther