Searching for and finding homes online is easier than ever, and most buyers are finding their homes on their own. Whether you've already found the place you want to buy or have just started browsing properties online, you might be wondering if buying a house without a realtor is a good idea. Here's what you need to know.
1. Mortgage Pre-Approval
The first thing you'll need to do to buy a house without a realtor is to get your mortgage pre-approval. Unless you plan on buying all-cash, you'll need to work with a mortgage lender and the first step will be getting pre-approved for a mortgage. Many real estate agents and homeowners will not take you seriously unless you have a mortgage pre-approval.
2. Search for Properties
The next step to buying a house without a realtor will be searching for homes and starting to explore the market. That means you should be ready to search through hundreds or thousands of property listings. While this is easier to do than ever thanks to technology, it can still be a nightmare, especially if you are new to the area. But if you know where you want to live, you won't need an agent to help you search for properties.
3. Tour Homes
Once you find suitable properties, it's time to visit them. You can either go to an open house if there's one scheduled or you can reach out to the owner or listing agent to schedule a private tour.
4. Request Disclosures
Next, you'll have to request disclosures from the seller. Seller disclosures will tell you known issues with the home, including things like structural damage or flooding. You also need to ask specific questions that may not be included in the disclosure if you live in a caveat emptor state. In most states, disclosures are given before submitting a formal offer to buy the home.
5. Hire a Lawyer
Before making an offer it's a good idea to hire a real estate lawyer. You might need to negotiate with the seller if you notice anything that's amiss with the home. This step can include asking for repairs, changing the home price, or even deciding the let the deal fall through if things aren't working out.
6. Make an Offer
Then, you have to put together the paperwork for an official offer. This will include the details about the title agency you will use, any contingencies, who will cover various fees, and the purchase price.
7. Home Inspection
If the seller is interested in your offer, you'll want to hire a home inspector to perform a thorough inspection and uncover any potential problems before it's too late. If the home inspector uncovers issues, you can negotiate repairs with the seller.
If all works out and you settle on a purchase price, it's time to close on the home. To finalize the home purchase, you'll first have to close on any mortgage loan. When your closing date comes, you'll do a final walk-through of the property before turning over the necessary checks. If you've hired a real estate attorney, they should be with you to ensure everything is in order.
Absolutely. It's perfectly legal in all 50 states to buy a house without using a real estate agent on your end. However, most people don't want to do it, as buying a home is a complicated process that most folks are unfamiliar with. A real estate agent can streamline the process and ensure it goes smoothly.
Buying a house also involves significant risk as it's the most expensive purchase many will make. That means having a professional in your corner is a good idea, whether it be a realtor, a real estate attorney, or both.
The main reason people consider buying a home without using a real estate agent is the belief that it will save them money. We all know that realtors collect large commissions, and some buyers might feel that their agent hasn't done much work at all. After all, if you're a buyer who found the house yourself, most of your agent's work will be behind the scenes.
Buying a house without an agent is rarely cheaper as the commission your realtor would collect will likely just be collected by the seller’s agent instead. So if the seller is working with a realtor, that agent will just be collected a larger commission instead of splitting it with your agent. The savings are unlikely to be passed on to you.
Additionally, a good agent might actually save you money through their experience negotiating. If you want to save money when you buy a home, the best option would be to work with a realtor who will give you a buyer rebate. This is an excellent option for buyers who are comfortable searching for homes online.
Most people do not have the knowledge and experience that a real estate agent has. There are also many problems that can arise when you don't know how to navigate a home sale. This can lead to making serious mistakes in your offer, overlooking potentially life-ruining problems with the house, or not being able to push a deal through. While a real estate lawyer can help you avoid certain potential pitfalls, an agent will be your greatest ally if you need help. Their experience and knowledge alone are enough to make most people rely on a realtor.
Sometimes, it might really make sense to buy a house without a realtor. If you already are well-acquainted with the house, the neighborhood, the process, and the seller, you might be able to wing it. You can certainly save some money if you're dealing with a For Sale By Owner property as the seller will be more willing to pass along the savings of not having to offer a commission to a buyer's agent. However, the vast majority of home sales should not be done without the help of a realtor by your side.
Buying a house without a realtor can be a risky endeavor. By going it alone, you might make a costly mistake that you will regret later on. A real estate agent can offer volumes of knowledge that can help guide you through the process, help out with the paperwork, and just be the go-to person to find your dream home. A good buyer’s agent will ensure a smooth real estate transaction. That's why so many people rely on them to find their dream home.