REALTOR Myths Uncovered

Dated: 02/15/2016

Views: 202

The More You Pay for a House, The More an Agent Makes

False. Ever hear a friend say this: "Every dime more you pay for that house makes the agent more money, so don't trust that agent." That's a misunderstanding. The difference between $300,000 and $310,000 is about $150 to an agent.

The Less Commission You Pay to Sell, The More you Make

False.Discount brokers like to propel this myth. They claim to save sellers money by charging less. The truth is agents who are top producers and excel in this business do not discount services. Why? Because they don't have to. Less-than-full-service agents can't afford all the bells & whistles paid for byfull-service agents, who tend to draw higher offers.

Agents Get Kickbacks from Lenders / Title / Inspectors

False.Since 1974, agents have been prevented from receiving any kind of kickback or favor from real estate vendors. It's against the law.

An Agent's Home Inspector Will Always Favor the Agent

False. Any agent worth her salt wants disclosure. Why? Because she wants what is best for her client but also, and this is not to be taken lightly, because she does not want to be sued. Agents must disclosematerial facts. A buyer is always, without fail, better off knowing the truth about a house. Good agents care that a buyer receives full disclosure and are willing to fight for repairs on the buyer's behalf or help the buyer cancel the transaction.

All Real Estate Agents Make Too Much Money

False.An agent'saverage annual salaryis less than $36,000 a year. Successful real estate agents certainly can make a very nice income. The amount of time,effort, and money that top producing real estate agents need to put forth is significant. A common real estate myth is that all real estate agents make boatloads of money. The general consensus is that real estate agents earn 6% of the sale price of a home, no matter what. This is not true. 

Agents Should Tell You About Crime, Schools & Ethnic Make-up of Neighborhoods

False.Federal Fair Housinglaws prevent a real estate agent from discriminating against a number of protected classes, which automatically prohibits an agent from disclosing anything remotely relating to the protected classes. Therefore, it may come as a shock to many people that agents cannot disclose crime rates, school stats or ethnic mixes of neighborhoods. If that kind of information is important to you, an agent can tell you where to find it but cannot provide it.

Agents Will Say Anything to Make the Sale

False.Although it is true that some agents will lie to you, it's unfair to paint all agents with such a broad brush. Top producing agents, those who enjoy a solid reputation in the community and practice real estate honestly and truthfully, are very careful to uphold a client's trust.

You Get A Better Deal When Buying a Home Through The Listing Agent
FALSE. Buying a home can be a complicated process, especially for a first time home buyer. It’s imperative that when buying a home, you have a great real estate agent representing your best interests. A common real estate myth is that when buying a home, using the listing agent will result in a better deal on the home. The thought process behind this myth is the listing agent will cut their commission percentage because they are receiving both “sides” of the transaction. What a buyer may not understand is that the listing agent is also still representing the seller. While they do need to be honest, fair, and ethical to all parties and certainly there are real estate professionals out there who can be trusted to represent both parties, it needs to be understood that the listing agent still has to represent the seller’s best interest.

Selling A Home “For Sale By Owner” Saves Lots of Money
False. The main reason sellers believe that selling their home “for sale by owner” (FSBO) is a good idea is because it will save them lots of money. Many sellers who attempt to sell their home FSBO believe that selling homes is easy. It would be great if selling homes was as simple as putting a for-sale sign in the front yard of a home, input the home into the MLS, and watch it sell, but it is not. FSBO’s often will end up losing money by not hiring a professional real estate agent. My husband and I bought our home from a FSBO and he ended up having to use his buyer’s agent on his new home because the appraisal came in low and he didn’t know what to do. He also didn’t know the protocol of communication during the process and there was a lot of miscommunication and hurt feelings at the end of the day.

Agents get paid to drive clients around or show property.

False. We only make money when a transaction is closed and funded.

Buyer will get a “price break” with a builder if you don’t use an agent.

False. Most builders are REALTOR friendly and encourage the agents to show their homes. Some agents even help the sales rep for the builder market their inventory homes as well as host open houses for them to help them sell.

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