Edith Lank - Column by Edith Lank

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House Calls: Using the Same Agent

Edith Lank

Hello: We are planning to list our home for sale with a real estate agent who we have known for several years; she has shown us homes from time to time.

On my own time, I researched and found a home I would like to buy. Which real estate agent should get credit for that purchase? I think that the man who listed the home I want to buy should get full credit for it. My wife feels an "ethical obligation" to give half the credit to the lady that we will list our home with, and then the other half for the agent of the home we want to buy.

But why should our first agent get partial credit for a home she didn't even find for us? I am also concerned that if the listing agent feels his percentage is going to be reduced, he will not try to negotiate the best/lowest deal possible for us. He could actually try to keep the home's selling price higher to recoup some of his lost percentage. -- C.

Answer: Many transactions take place with only the seller's agent arranging everything, and they work out fine. You're better off, though, with your own buyer's agent, and here's why:

By law, the listing agent's loyalty is due to the seller. His fiduciary duties, by the way, include getting the highest possible price for the property. So, it won't hurt to have someone else acting as your own buyer's agent, legally obligated to put your interests first while you're negotiating.

You could explain to your original agent that you've found the house you want. If you've already seen the interior, be sure to make that clear to her. The two agents can work out the matter of commission splits, and it shouldn't concern you.

As for your wife's concern about ethics, your longtime agent has already invested time with you, even if she didn't find "The House." And anyhow, you need a lot more additional services. Locating the place you want to buy is just the tip of the iceberg. You'll need someone to advise on price, help with negotiations and keep tabs on financing, inspections and legal procedures until closing. And it may be easier to dovetail your sale and purchase settlements if you're using the same agent for both transactions.

So, I guess I'm with your wife on this one.

If you pay an extra thousand dollars, by the way, that listing agent gets enough additional commission to pay for a cup of coffee. Take my word for it, agents don't calculate that way. Their goal is to bring buyer and seller to a meeting of the minds so the deal goes through.

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BIDDING ON TWO

Edith: Two properties for sale. Can I bid on both properties at the same time? Can I pursue the first one that accepts my bid, and at same time walk away from the other with no consequences? -- R.J.

Answer: If your offers are in writing, and if they are accepted in writing before you have time to withdraw either one, you could be in trouble. You'd be obligated on two binding contracts. Losing an earnest money deposit could be the least of your problems.

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NO ACTION IN A YEAR

Dear Edith: I have had my home on the market for well over a year and my real estate agent has not show it once. Is this normal? -- S.

Answer: Of course not, and you may have a legitimate complaint against your agent. If you're not being urged to drop your price, you're not being well served.

If your house has been entered in a multiple-listing system, many agents know about it and could be bringing customers. But they can't drag prospective buyers by the hair into an overpriced house. My guess is that the buying public has voted that your place is not worth anything near what you're asking.

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TAX-DEFERRED EXCHANGE

Dear Edith: We own a vacation home and are considering selling it to purchase another vacation home on a different lake. We have used the property exclusively for our own enjoyment and it has never been rented out. Our son suggested that we look into a Like-Kind Exchange. Are vacation homes eligible for this kind of treatment? If so, what IRS publication would be helpful? -- e-mail

Answer: You can look up Section 1031 tax-deferred exchanges on the Internet, but I'm afraid you'll find they're only for investment property.

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Edith Lank will respond personally to any questions sent to her at 240 Hemingway Drive, Rochester, NY 14620 (please include a stamped return envelope), or readers may e-mail her at ehlank@aol.com.

Copyright 2009 Creators Syndicate Inc.

This news arrived on: 10/11/2009

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