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My fiance and I have been trying to hunt down a nice house (Our first house) for a little over a year now and decided to get a buyer broker since everyone recommended they can take some of the headaches out the whole house looking/purchasing. The buyer broker I went with recommended a house that was a great deal and is near brand new but a foreclosure. The only downside is copper thieves came in and removed some of the piping for the boiler which we had quoted at around 2k for repairs. It has everything I could ask for in a house and plenty of room for customization and what not. After just a few weeks of trying to get the bank to agree on an offer the buyer broker has been becoming more and more hostile and questioning why my fiance and I want the house at all. We tell him that it has everything we have dreamed for and he keeps just putting us down more and more. We're about ready to terminate the contract with him but I'm curious has anyone else had bad experiences with using a buyer broker or recommendations?

Used house salesmen are the same as used car salesmen for the most part, 1 out of 10 is great. They're not making money if you're not buying, you're taking more of their time than they had budgeted. Get a different one if this deal falls through, terminating the contract then buying a house he showed you is going to put you in a bad place.

jss21382 wrote:

They're not making money if you're not buying

This is quite true. The original Freakonomics book -- while sometimes mixing up causation and correlation -- has a whole chapter on why buyer agents rush through your sale and milk their own sale for every penny. I suggest you peruse a copy of the book at the library or borrow one from a friend. It's all in the "incentives matter."

We used the same realtor for both our house purchases and the sale of the original. His wife works with my wife, so there was an incentive to treat us fairly.

Being in a couple heavily commissioned fields myself, I can tell you from experience it's very very easy to look at each individual job/client and push them or write them off, but in the end, I've found that if you just don't worry about it and provide great service you'll end up making more. It's a hard mindset to get into, and a hard mindset to stick with for someone who is paid by the sale, especially, in their case, if it's been a couple months since they've closed and bills are coming due.

Is a buyer broker the same as a real estate agent?

If so, then any good real estate agent knows that a single sale is not in their best interests... They usually want to develop a good relation with you to make sure that you recommend them, and use them for all future transactions.. No one agent will be perfect, but finding one that you can trust is vital.

I assume the broker's problem is exactly what the others have described, your negotiation tactics are dragging out the sale time relative to what the broker intended to contribute.

Speaking as a recent homebuyer, the main thing I would be concerned about is whether your lender and insurance company are willing to close while a critical household service is non-functional, as that may designate the property as technically uninhabitable. I assume you've already looked into that and made contractual provisions accordingly, but if not, do so immediately.

I sold my place recently and the selling agent had a very similar agenda. The only interest he appeared to have in the whole transaction was his own and he could care less about anything else. I lost a ton of money on my apartment but the icing on the cake was that I had to pay $3K on top to close the deal. If he wasn't such an ass I might have gotten a little more money for my place (maybe a couple of thousand) and wouldn't have to pay so much out of pocket. To top that off, the lovely state of Taxachusetts still managed to tax me despite a major loss for which I regularly wish them to burn in hell. I sure won't be buying anything any time soon.

druidcent wrote:

Is a buyer broker the same as a real estate agent?

Yes.

In the usual scheme of things as practiced here in the US, the listing/selling agent gets a 6% commission right off the top of the deal. If there's a buyer broker, that commission is split at 3% for each. Naturally, listing/selling agents hate it when buyer brokers get involved.

ludi wrote:

Speaking as a recent homebuyer, the main thing I would be concerned about is whether your lender and insurance company are willing to close while a critical household service is non-functional, as that may designate the property as technically uninhabitable. I assume you've already looked into that and made contractual provisions accordingly, but if not, do so immediately.

That's one of the reasons as to why it's been taking some time to negotiate. At one point we were very close to finally getting them to repair the heating system...then the holidays came along and with it a new asset manager for the bank which has reset us back to step one in negotiating.

When we had the estimate for the repairs going on the buyer broker started being really aggravating asking us why we're even here like a little child.

Omniman wrote:

When we had the estimate for the repairs going on the buyer broker started being really aggravating asking us why we're even here like a little child.

Just remember that the fee structure in no way rewards real estate agents on either side of the transaction for keeping the sales price as low as possible. Your 3-percenter buyer broker has obviously put enough work into this deal that his calculations show him breaking even or losing money, hence the desire to upsell you and make a profit.

Buying/selling a house definitely ranks up there in aggravation level looking for a new job, and exceeds the aggravation level of buying a car. I imagine getting a divorce is worse, but I've never had one so I can't speak from experience!

just brew it! wrote:

Buying/selling a house definitely ranks up there in aggravation level looking for a new job, and exceeds the aggravation level of buying a car. I imagine getting a divorce is worse, but I've never had one so I can't speak from experience!

Have a coworker with 1 divorce, two house purchases, and four car purchases. Guaranteed that the divorce is #1 PITA.

Depends on the area I guess.. Here in Cali, based on market conditions, it's dropped as low as 4%.. when banks are involved, the agents are limited on on what they get. Part of the problem is getting your agent so late in the process. Generally buyer's agents work for free for buyers (they get their commission from the seller). Having an agent who shows you around places you'll develop the relationship and it will help a lot. If you don't know one, ask friends for recommendations. Worst case, try out different agents. It may be different in your area, but there is no obligation in CA to keep an agent. I think there is an exclusivity clause so that you only have one agent at a time, but other than that, you should be good. A good agent will get you a place that you love, a bad agent will turn the process into a nightmare.

Also, don't worry if you don't get this house.. you may think it's perfect for you (and it may be), but the nice thing is that there are many other perfect houses out there that you'll love.

Oh, and one last bit of advice.. Run FAR FAR FAR away if BofA is a bank on either side of the transaction. They are absolutely the worst especially on the loan processing side. If they are you loan provider, get a new one ASAP.. They've been a serious pain in our ass every single time we worked with them...

I dunno, I had a blast shopping for houses. A few got sniped from under me while shopping, but I learned how to do that when we finally found our house. We left lots of angry and disappointed competitors when we found our deal, including our new neighbor. They knew how good the deal was and wanted to invest/flip it. We were signing the paperwork the minute the house opened. Beat one opponent on the phone by $50 who used a broker for a negotiator and had set a firm limit under the asking price (dummy).

The key is to have a pre-approved loan, and not have any conditions like needing to sell your current residence first. You also need to hover over the sales listings like a hawk if you want a deal.

druidcent wrote:

I think there is an exclusivity clause so that you only have one agent at a time, but other than that, you should be good. A good agent will get you a place that you love, a bad agent will turn the process into a nightmare.

This is state-by-state; here in VT if you switch agents and buy a house the dropped agent showed you within 6 months of the drop, you owe them commission according to the standard brokerage forms/contracts. It can be negotiated but is definitely something to read & grok before signing.

EDIT: As for loan providers, I will always stay strictly local bank/credit union. I like knowing exactly where the decision-maker sits and having direct access to them.

Captain Ned wrote:

druidcent wrote:

I think there is an exclusivity clause so that you only have one agent at a time, but other than that, you should be good. A good agent will get you a place that you love, a bad agent will turn the process into a nightmare.

This is state-by-state; here in VT if you switch agents and buy a house the dropped agent showed you within 6 months of the drop, you owe them commission according to the standard brokerage forms/contracts. It can be negotiated but is definitely something to read & grok before signing.

EDIT: As for loan providers, I will always stay strictly local bank/credit union. I like knowing exactly where the decision-maker sits and having direct access to them.

Hmm.. Yeah, I think I remember something like that.. I sometimes forget the "nefarious" side of people... Usually if an agent shows you a house that you like, you use them to buy the house. I was thinking more along the lines of if you don't like an agent, you can usually end any sort of relationship at any time with them. Not sure about inventory in VT, but here in CA when we were looking at houses, the same stuff kept showing up week after week.. but those are usually undesirable houses.

With BofA, the loan officer was good.. it was the processing staff and underwriters (and appraisers) who suck donkey balls...

druidcent wrote:

Not sure about inventory in VT, but here in CA when we were looking at houses, the same stuff kept showing up week after week.. but those are usually undesirable houses.

Minimal foreclosure inventory here in VT and most of those are upside down in streambeds courtesy of Irene.

druidcent wrote:

With BofA, the loan officer was good.. it was the processing staff and underwriters (and appraisers) who suck donkey balls...

Have to remember that the mortgage disaster changed how appraisals work. No longer can the loan officer call the appraiser and make an appointment. Nowadays they all have to go through 3rd-party appraisal management companies so that the loan officers, underwriters, and processors have no idea who will be doing the appraisal until it hits the Fannie/Freddie/FHA portal for them to read. Given refi pressures, the appraisal community is out straight.

druidcent wrote:

With BofA, the loan officer was good.. it was the processing staff and underwriters (and appraisers) who suck donkey balls...

Yeah, tell me about it. When we refinanced a couple of years ago (not BofA, but another large bank), the loan officer was fine. But the handling of the escrow for insurance and taxes has been a mess. They're still f*cking around trying to get it right. This ain't rocket science, people!

just brew it! wrote:

But the handling of the escrow for insurance and taxes has been a mess. They're still f*cking around trying to get it right. This ain't rocket science, people!

Escrow complaints. Must get one or more of those every day in the office.

If the loans were only sold once like in the old days it'd not be an issue. When the loan and the servicing rights are stripped from each other and resold a dozen times on the open market, good luck. One benefit of using a state-chartered bank (unlike BofA) is that most state-law escrow statutes make the current servicer explicitly responsible for any fines & penalties incurred due to their cock-ups.

Sad thing is, in this case it is still being serviced by the originating bank. First there was confusion over whether the insurance was coming out of the escrow or not; the bank seems to have figured this out, but insurance company still seems to be a little confused (most recent bill was simultaneously showing as both paid and past due on their web site). Then there was some other screwup (which I still don't understand) which resulted in the escrow payments being calculated incorrectly. I *think* it is finally straightened out now (as of this month), but we'll see...