Jack's Real Estate Questions

[Jack Hawksmoor]

What exactly, in your opinion, is a realtor? Is he like a car salesman but sells homes instead?

Who pays the realtor?

Is the realtor self employed so that he may buy the home and than turn around and sell them?

Prudential, is that a board of realtors or a company that hires them and sends them out?

Does the State of Hawaii by law require a realtor to be involved in the transaction between the two parties or just be present at closing?

Have you ever been insulted by a real estate agent? My pride bruises easily.


I like to do things by myself if it can save me money. You know, since when does anyone call a car dealer and tell him your selling your car (paid in full) on craigslist. It is none of his damned business.

[glossyp]

Re: Realtors...are they like car dealers?

Selling your house or buying one is not comparable to selling/buying a car. The legal ramifications in this modern sue-happy world make real estate transactions potential minefields for the uninitiated. (BTW, I am not a real estate agent.) In a former lifetime I did work as a real estate appraiser so I have had enough contact with real estate agents to know that there are good ones and bad ones, just like in anything else. The profession does seem to attract more than its fair share of shark-type personalities - though it could be argued that the profession makes them this way. I tend to believe that those who go into real estate already have a predisposition - kind of like only those prone to self importance and power hunger become politicians.

Who pays the real estate agent? It depends, but generally it is the seller and that means the agent has a fiduciary responsibility to the seller, not the buyer. Many people don't realize this and it can lead to misunderstandings. If I were buying real estate, I'd hire my own agent and pay them directly to ensure I was represented. If I was selling, I'd list with an agent to maximize exposure and save myself countless hours of time and reams of paperwork that are now required by law.

And, FYI, the word "Realtor" is a trademark of the National Association of Realtors and only members of the NAR can legitimately call themselves a Realtor.

[Jack Hawksmoor]

Re: Realtors...are they like car dealers?

Thankyou, i don't know what happened but when i tried to post my topic it kept disappearing and the message board kept telling me i was logged out and couldn't edit my post.

I will go back to doing my research because i think i am confusing a realtor with a real estate agent.

[Leo Lakio]

Re: Realtors...are they like car dealers?

I see this thread, and all I can think is: in ANY line of work, you will find unscrupulous practitioners, and you will find those who are dedicated to doing the best job they can for their clients - same with car salespeople, attorneys, educators, journalists or mental-health workers.

[anapuni808]

Re: Realtors...are they like car dealers?

I spent a few years working for a real estate investment firm. All "Realtors" are real estate agents. However, all "Real Estate Agents" are not realtors. There are 2 kinds of agents: Brokers and sales persons. A sales person can advance to Broker level with more education and experience. All persons designated as "sales persons" must be supervised by a Broker. and that pretty much exhausts my knowledge of real estate

If you are buying property, you should definitely have your own agent with no ties to the seller. Your own agent will be concerned with making the sale so they get a commission. The seller's agent also wants to make a sale but because most commissions are percentage based, the seller's agent is motivated to negotiate a higher sales price so their commission is larger.

Good luck!

[tutusue]

Re: Realtors...are they like car dealers?

[...]Who pays the real estate agent? It depends, but generally it is the seller and that means the agent has a fiduciary responsibility to the seller, not the buyer. Many people don't realize this and it can lead to misunderstandings. If I were buying real estate, I'd hire my own agent and pay them directly to ensure I was represented. If I was selling, I'd list with an agent to maximize exposure and save myself countless hours of time and reams of paperwork that are now required by law.

Yes, the seller pays the commission to the seller's real estate company (unless it's stated otherwise in the listing). However, the buyer need not pay his/her agent directly as the sales commission is split between the sellers and buyers agents. I'm not really sure if a buyer paying his/her own agent directly is even legal. Someone please correct me if I'm wrong. I believe the standard is still 6% commission based on the selling price with 3% going to each of the real estate companies involved (again, unless it's stated otherwise in the listing). If an agent doesn't own his/her own company then each company has an agreement on how that 3% will be split between the company and the agent.

What should be avoided is both seller and buyer using the same agent during a transaction for the reason mentioned above...fiduciary responsibility. The listing agent's responsibility is to the seller.

There was a time when one could fairly safely sell his/her own home. I did it decades ago. It's still legal to do that but, if something goes awry, the ramifications are huge. This is not a transaction one should try to cut corners on.

For disclosure purposes, I had my RE license from the late 70s to early 90s and used it for personal transactions when I was flipping homes. I also helped 2 friends with their sales. I really disliked RE sales as a business and let my license expire.

There are many reputable agents around and, no, I don't classify them the same as car sales people!!!

[glossyp]

Re: Realtors...are they like car dealers?

Yes, the seller pays the commission to the seller's real estate company (unless it's stated otherwise in the listing). However, the buyer need not pay his/her agent directly as the sales commission is split between the sellers and buyers agents.

In this case the commission is being paid by the seller so the agents for both buyer and seller have a fiduciary responsibility to the seller.

I'm not really sure if a buyer paying his/her own agent directly is even legal.

I'm not sure of the legality here, but in most jurisdications, including California, it is perfectly legal for a buyer to hire an agent to represent them; in this case the buyer's agent receives no commission from the seller which removes the fiduciary responsiblity to the seller, seller's agent and selling agency.

[tutusue]

Re: Realtors...are they like car dealers?

In this case the commission is being paid by the seller so the agents for both buyer and seller have a fiduciary responsibility to the seller.

This subject is interesting enough to me that I've emailed a broker friend of mine for clarification. She's not always good about responding but if she does I'll report her insight here!!!

I'm not sure of the legality here, but in most jurisdications, including California, it is perfectly legal for a buyer to hire an agent to represent them; in this case the buyer's agent receives no commission from the seller which removes the fiduciary responsiblity to the seller, seller's agent and selling agency.

So, using Calif. as an example, when the buyer's agent receives no commission via the seller, does the seller's agent still expect a 6% commission upon sale or is negotiating the percentage common practice now?

[oceanpacific]

Re: Realtors...are they like car dealers?

Seller's agent will often specify that they will share commission with buyer's agent.

[kamuelakea]

Re: Realtors...are they like car dealers?

Realtors work only for closing the deal. They don't really work for either party. While the 6% might come out of the seller's escrow account, we all pay for it by simply adding to the cost of home ownership.

Realtors are at a crossroads. They probably won't go the way of the typewriter repairman but they are going to change drastically. I don't need a realtor or a real estate agent of any kind when I buy or sell property. I can get all the information I need from the internet. I do need a real estate attorney to advise me regarding the contract. Interestingly there aren't a lot of attorneys specializing in this type of service. They tend to try to charge the same 3% of the sales price as opposed to a reasonable hourly fee based upon time spent. I think there is a niche for attorneys out there in the near future.

The only reason the real estate profession was able to exist for so long with the 6% fee was their control of the MLS system. That is slowly breaking down and with that, they are toast.

Don't get me wrong, a good salesman is always worth their fee and I'm sure many a real estate agent has got their client far more than the 6% fee but the system has been and continues to be based upon an inefficient monopoly. But it's days are numbers.

[oceanpacific]

Re: Realtors...are they like car dealers?

In this state, a licensed attorney is deemed to be qualified to handle real estate transactions.

[tutusue]

Re: Realtors...are they like car dealers?

This subject is interesting enough to me that I've emailed a broker friend of mine for clarification. She's not always good about responding but if she does I'll report her insight here!!![...]

Insight report! This is from a broker who I've known for years and years:

There is a somewhat new thing called being a "Buyer's Agent". You have a Buyer-to-be sign a contract saying they will buy only thru you and you will look for things for them and then you are paid thru the Seller's commission (as usual). This protects the Realtor from working, showing, negotiating, etc. and then have a Buyer walk into an Open House and get emotionally involved and buy on the spot from the sitting Realtor. Or going to a For Sale By Owner and buying directly after you have spent time, effort, gas and tires showing him and educating him on the market. In either case he owes you a commission!
The newest Realtors' code of ethics requires us to treat all parties honestly (it used to say 'fairly' but that was hard to pin down). In our transaction, my fiduciary duty was solely to <buyer - name removed> but I could not take advantage of <seller's agent - name removed> nor her client, the Seller.
The really hard thing to do these days is "dual agency", representing both parties. There are addenda to fill out, etc. PRIOR to both the listing and the sale. There are law suits everywhere over this. Some Buyers will work only with the listing agent which is fine but it can trigger problems.
The business changes every day.

[Jack Hawksmoor]

Re: Realtors...are they like car dealers?

Realtors work only for closing the deal. They don't really work for either party. While the 6% might come out of the seller's escrow account, we all pay for it by simply adding to the cost of home ownership.

So it is safe to say, that Realtors get thier 6% commision after completing escrow, closing. Do they have a flat rate?

What happens if they fail, what are the consequences? Say one of the parties violates a clause making the agreement void. Does the seller and buyer still have to pay that 6% to the Realtors? Or do they keep trying again and again to seal the deal?

[Jack Hawksmoor]

Re: Realtors...are they like car dealers?

Selling your house or buying one is not comparable to selling/buying a car. The legal ramifications in this modern sue-happy world make real estate transactions potential minefields for the uninitiated. (BTW, I am not a real estate agent.) In a former lifetime I did work as a real estate appraiser so I have had enough contact with real estate agents to know that there are good ones and bad ones, just like in anything else. The profession does seem to attract more than its fair share of shark-type personalities - though it could be argued that the profession makes them this way. I tend to believe that those who go into real estate already have a predisposition - kind of like only those prone to self importance and power hunger become politicians.

Who pays the real estate agent? It depends, but generally it is the seller and that means the agent has a fiduciary responsibility to the seller, not the buyer. Many people don't realize this and it can lead to misunderstandings. If I were buying real estate, I'd hire my own agent and pay them directly to ensure I was represented. If I was selling, I'd list with an agent to maximize exposure and save myself countless hours of time and reams of paperwork that are now required by law.

And, FYI, the word "Realtor" is a trademark of the National Association of Realtors and only members of the NAR can legitimately call themselves a Realtor.

How much do Real Estate Appraisers charge?

Who pays the appraiser?

Do you have to sell a house for what an appraiser tells you to?

Your quote stuck out to me:

The legal ramifications in this modern sue-happy world make real estate transactions potential minefields for the uninitiated.

I heed your warning and rather not be locked in.

So it can say in the Purchase Agreement under ATTORNEY'S FEES: If someone screws up, and this goes to court, the loser pays court costs etc. Since you are not locked in, you cannot be accused of default. Like so:

ATTORNEY'S FEES: Any signatory to this agreement who is the prevailing party in any legal proceeding against any other signatory brought under or in relation to this agreement shall be entitled to recover court costs and reasonable attorney's fees from the non-prevailing party.

[Jack Hawksmoor]

What is a Mortgage broker?

http://en.wikipedia.org/wiki/Mortgage_broker

A mortgage broker acts as an intermediary who sources mortgage loans on behalf of individuals or businesses.

http://finance.yahoo.com/loans/artic...riends-or-foes

Mortgage Brokers: Friends or Foes?
by James R. Hagerty

"The mortgage broker does not represent the borrower," says Chris Holbert, president of the Colorado Mortgage Lenders Association. "We sell access to money." The industry group recently opposed language in Colorado legislation that would have required mortgage brokers to act "primarily for the benefit of the borrower." That provision was later deleted.

http://www.dontriskyourhome.com/whatis_predlend.htm

Predatory lending is actually a variety of harmful practices that are designed to take advantage of a consumer's inexperience or lack of sophistication to manipulate a borrower into paying more for their loan than they need to. We are most concerned with residential real-estate transactions.

In the real-estate world, predatory lending is terrible lending practice designed to take away your home equity. If you agree to a loan based on the equity you have in your home, you could easily be putting your home at risk. Through false promises and outrageous fees, predatory lending can ruin your credit and lead to foreclosure. Homeowners-especially the elderly, minorities, those with low income or damaged credit-should be extra careful when choosing their loans. These borrowers are often targeted with abusive and exploitative practices. Home financing is a complicated world of tough language and difficult-to-understand practices. Don't risk your home-be careful.

Does anyone here, on these threads, can please give me a simple definition of a mortgage broker?

What do you guys know about these guys? Have any of you dealt with them before?

I can't seem to understand what i dug up and need someone to translate it for me?

Pretty please.