Are you looking to hire a real estate broker? Getting the right one can catapult you to property success. However, the wrong choice could tie you down in a time-consuming, expensive process that brings few results.
If you are looking for a broker, there are a few questions you must ask. Below, we give our top 7 questions to ask a real estate broker.
1. What Is the Process?
Firstly, you need to know the process. If not, you may miss out on important information, which may result in delays or added costs. In addition, you will want to know what you have to do and prepare as a buyer or seller.
Depending upon the laws of your state, and how your real estate broker likes to operate, will determine this process. As it can differ from broker to broker, you should be sure to get them to detail how the full transaction will work. This must be from the initial process, all the way to the final signing off.
2. What Are Your Certifications?
The laws and best practices of real estate are constantly changing. As such, if your real estate agent is lacking qualifications, or they are outdated, it should be a warning sign. There are a number of official certifications that should set your mind at rest when searching for a real estate broker.
The National Association of Realtors is a professional accreditation board. They have strict rules and regulations on who can join, and any realtor who is a member should be trustworthy. After this, there are a number of certifications such as CRS, ABR, SRS, and SRES that are all specialist qualifications for various areas, such as senior citizen sales and seller representation.
3. Questions to Ask a Real Estate Broker Regarding Fees
Typically, it is the seller that pays the broker’s fees. If you are buying, costs should not affect you. A standard commission should be around 6% of the closing sales price, which is divided between the sellers and buyers agents.
Sit down and discuss all costs with the broker. This applies not just to their fees, but any costs you will incur throughout the whole process. This will give you a better idea of the profit you can expect to make after the final sale.
Don’t be tempted to go with brokers that have low fees, just to maximize your own profit. It is quite likely you will get substandard service. This can result in a longer process, or one that falls through costing you time and money.
4. How Long Have You Been an Agent?
Experience is crucial when you are searching for a real estate broker. The longer they have been working in the field, the better. At the minimum, you should be looking for someone who has around four years of experience.
Real estate throws up a lot of tricky problems. You need someone who has the experience and expertise to handle whatever may occur. Never opt for anyone who does brokering as a side job or part-time occupation.
You should also look for brokers in real estate who have experience in the location you want to buy or sell in. Knowing the local housing market can help you get the best value for money. They will know good areas to buy or sell in, upcoming areas, and any developments that may impact prices.
5. What Will You Do to Help Me Buy or Sell?
If you are extremely lucky, the market may be so buoyant that the broker really needs to do very little to buy or sell your property. However, that is unlikely. Most markets are crowded and competitive, and you need to know what the broker is going to do to earn their money.
For buyers, you need someone who knows the market and has their finger on the pulse. If an ideal property comes up, they need to be informed of it and get you in first.
If you are selling, you need to know how good their pricing is. Many brokers may hike up the price they give you so that you think they can get you more money. However, this is unlikely to lead to a sale.
They should have a sale to list ratio. This is a ratio of the asking price divided by the final sale price of properties they have sold. The closer to 100% it is, the better it will be for you.
6. Do I Pay Penalties for Cancellation?
Most agents will ask you to sign an exclusivity agreement, that will last for a specified amount of time. This ensures you are only using their services, or you could simply sign up to every real estate broker in town. Many of them will charge a termination fee if you decide to cancel this contract.
Brokers who offer very long contract periods, and make it hard for you to get out, should start ringing alarm bells. This is especially true if it seems very easy for them to get out of the contract.
7. Do You Have References?
Any good broker should be able to provide references. Of course, they will only give you good ones, so do your own research. Ask around, look online at reviews, and speak to previous customers.
The internet attracts negative reviews, so if you find a broker with mostly good but one or two bad ones, ask them what happened. Their response will tell you how professional and experienced they are. Be very wary of anyone who has no references at all, good or bad.
Starting the Process
Once you know the correct questions to ask a real estate broker, you can sort out the useful ones from the brokers to avoid. Go with your instincts and avoid any offering abnormally low prices.
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