In order to save investment $$ and give you freedom, is it better to deal with a seller or seller agent directly, versus find my owner agent to represent me?
This will be my first deal. I am thinking of asking for seller finance and possibly repair allowance and down payment installation for say 20% down, or even no down.
My plan is to look for a prop. with upside potential like repair, low vacancy. Any tips on negotiation and deal structure techniques are greatly appreciated.
If you want to do anything creative you’re not likely to get co-operation from a broker. “Creative” to them means work and less commission or none at all.
In my opinion it’s better to work with sellers directly because right from the start you’re saving the commission and that brings down the price. But whether you work with a broker/agent or not, you need to sit down with the seller face-to-face and talk it over. Using a go-between just muddies up the water and things get misunderstood.
Remember the old children’s game of “Tell me a secret”? You tell one person something and they pass it on til it comes back to you and you don’t even recognize it. Same deal.
I’ve got to strongly disagree with Putz (can I call you Putz? :P)…and no disrespect.
I’m an Associate Broker/Certified Appraiser - former Home Inspector/Commercial Pest Control Consultant, and I invest & work with investors. My knowledge & experience actually saves my clients bundles (not costs them). They’re happy to pay my commission.
Moreover, many sellers are unwilling to talk to you directly. They feel that they’re paying a real estate professional to represent them, and the agents’s probably already pointed out to them that they’re a skilled negotiator & it would prove unwise to speak to perspective purchasers themselves (I do).
I would also disagree that using a “go-between” (agent) muddies the water…everythings spelled out in a contract so everyone understands.
I just brought an offer to a seller today for greater than asking price. He’d considered using a discount brokerage. He told us today that our CMA was much higher than anyone else’s and how happy he was he decided to sign with us. Our niche is value–VERY IMPORTANT-- to our clients.
If you decide to go it alone…you may be negotiating with a skilled professional who’s job is to get the best deal for their client. Unless otherwise agreed to by all parties…they’ll be respresenting the seller not you. If you meet and trust the sellers agent…consider asking about a dual agency relationship.
Good luck.
Hi infowell,
Can you elaborate on dual agency relationship? I guess this is not very common practice to RE broker/agent.
I didn’t mean to imply that people should NEVER work with a Realtor or an agent. I was refering to the “creative” deals that most Realtors/agents get spooked by and therefore don’t want to submit because they may have trouble understanding them and won’t be able to answer questions about them.
THAT is when the buyer and seller need to meet. The Realtor/agent can be there too as can any other advisor for or from either side. The point is to make certain that everyone understands everyone else and can make informed decisions.
There are plenty of sharp R. E. professionals who could run rings around me; but there’s a slew of them out there who make Forrest Gump look pretty slick.
All I’m saying is if it’s YOUR deal, YOU need to take control and make it happen. If it can be handled to your satisfaction by a Realtor/agent so be it.
Sorry if I offended anyone.
Since this is your first deal, don’t go at it alone. Sure you could save some money, but you could also bury yourself. Find somebody who deals with investors on a regular basis, and bring them in on the deal. Once you are comfortable with how things work, then go ahead and try flying solo. (2¢)
Cainvestor-
You’re quite correct…dual agency is not all that common. In fact I don’t believe it’s permitted in some states…you’ll have to check the laws of agency in your state (this could probably be accomplished online).
Dual Agency has be agreed to in writing by all parties involved in the transaction.
And thinking about it…Putz is correct: Agents experience & backgrounds are largely diverse…some agents specialize working with investors & could write a book about creative financing–while others may not have a clue–you need to know which one your working with.