New Jersey Homes – NJHomeBuyer.com Realty

I went to the RE/MAX.com website today and clicked Real Estate101 in the learning center tab.

I found this statement under tips for choosing a real estate agent (this is their suggestion for both sellers AND buyers):

“If you’ve already determined where you’d like to live, drive through neighborhoods in the area and survey them for REALTOR® yard signs. Seeing the same name pop up on signs time after time may indicate that the agent is a specialist in the area.”

If you take RE/MAX’s advice you may very likely end up with a dual agent or just as bad – a seller’s agent as your agent. If you want buyer representation and an agent that will be proactive in protecting your interest (expecially at the expense of the seller’s interest) never never agree to ‘work with’ an agent that works for a company that already has obligations to the seller.

In both New Jersey and Pennsylvania, where I’m licensed, the states require that agents disclose who they are working for at the beginning of their relationship. The laws requiring that disclosure were generally written before the internet became the main information source for consumers. The result is that, although the internet is generally the first significant point of contact between a consumer and a company offering real estate services, the states’ licensing authorities do not require (apparently) that a company disclose issues of representation to consumers. And so far they have not been required to provide disclaimers.

Therefore, when you read a real estate company’s (or even an individual agen’ts) website – beware. Although such websites may contain much useful information some information that seems to be helpful may only be serving the interest of the real estate company.

The following text is provided in the ‘Buyer’s Guide’ “Making an Offer” information section on the Weichert.com website:

“After helping you think through the issues to determine the best offer for you to make at the time, your Sales Associate is well qualified to negotiate on your behalf with your best interests in mind.”

No mention of the agency status. No mention of who they are representing. But it IS a “Buyer’s Guide”.

Of course, they might try to say that the statement says that the associate is ‘well qualified’ to represent the consumer – not that they will represent them – but that is not what a consumer will get from reading that statement, which I believe is intentionally misleading. Besides, if they are a dual agent or seller’s agent they will not be helping the buyer think through the issues to determine the best offer anyway.

I point this out because Weichert is not alone. Many real estate websites (both company and individual) make similar representations, which are nothing less than misleading and deceptive advertising.

It is time to start being honest with home buyers. Unless a company ONLY represents buyers they CAN NOT make such representations without a disclaimer.

Please destroy your fax machine and never use it again. Ever!
I am sooo serious. I hate fax machines. I don’t own one and neither should you. If you must use ‘fax’ get an efax (or similar ) number already.

I don’t have a fax number on my business card for one simple reason – I DON’T WANT YOU TO SEND ME A FAX.

Believe it or not I have email. Unless you don’t there is no reason to be sending faxes. And if you don’t I probably will not be doing business with you anyway.
It is just too much trouble.

Thank you for your time.

Regards,

Paul Howard, Broker/Owner
NJHomeBuyer.com Realty
Cherry Hill, NJ
856-488-8444
OH, don’t forget to fan my business page on facebook at:
facebook.com/homebuyers

That should be obvious to buyers but I know that it is not. Think about it:

The bigger the real estate company the fewer homes they can show as a buyer’s agent if they represent both buyers and sellers.

If a real estate company has more listings that means a smaller chunk of the available inventory is available to them to show as a buyer’s agent. That is because they can’t be a buyer’s agent if they work for a company that listed the home.

A better move for buyers then is to find a smaller company when they are looking for a buyer’s agent to help them purchase.

The BEST move a buyer can make is to find a company that has a policy of NEVER listing homes. Those companies (Called Exclusvie Buyer Offices) always have the biggest housing inventory available to them that can be shown as a buyer’s agent.

For more information contact:

Paul Howard, Broker
NJHomeBuyer.com Realty (An exclusively for buyers company)
MEMBER: NAEBA
856-488-8444
Cherry Hill NJ 08002

http://www.facebook.com/homebuyers

http://www.naeba.org (National Association of Exclusive Buyer Agents)

House Hunting: the next step: an offer

When you are ready for the next step: an offer should include. (NOTE: in South Jersey this is one page and not binding)

1. Offer price
2. settlement date
3. contingencies: (inspection/financing are most common)
4. earnest money deposit amount
5. What is included (eg washer, dryer, refrigerator, etc)
6. The amount of commission your agent will receive from the seller.
7. a copy of your prequalification letter from your lender or proof of funds (if you are paying cash)

FaceBook.com/HomeBuyers

Paul Howard,Broker
NJHomeBuyer.com Realty
811 Church Rd
Ste 111
Cherry Hill NJ 08002
856-488-8444

There are a lot of great agents with real estate licenses. Most buyers know they should use a buyers’ agent and they have a lot of companies to choose from. What they almost never realize when they start working with a company is that the company’s agent often can’t guarantee that they will continue to work as a buyers agent for the buyer up through the purchase.

There is one reason they can’t guarantee this and one circumstance under which they can.

The reason they can’t is that chances are their company lists homes. If the buyer wants to see one of those homes a buyer agents duty of LOYALTY goes away because that company has duties to the seller. The agent CAN NOT be an ADVOCATE for the buyer because they owe the same alligience to the seller as to the buyer – at best. The buyer just lost part of their basis for selecting that agent.

If the company does NOT list homes or represent sellers that is a different matter. The company, then, is an exclusive buyer office and the agents working for them are Exclusive Buyer Agents. EBA for short. EBAs can guarantee to maintain their status as a buyer’s agent up through the purchase.

A good EBA agent is better than a good generic agent every time.

–Agents thinking of opening an Exclusive Buyer Office should contact the National Association of Exclusive Buyer Agents (NAEBA) at http://www.naeba.info .

–Home buyers looking for an EBA should contact NAEBA for a referral to a member agent in their area at http://www.naeba.org .

The short story.  Virtually all states have some form of agency disclosure law.
Agency refers to a real estate company representing a buyer or seller. As in “REMAX is my agent” or “NJHomeBuyer.com Realty is my agent”.  Note that Mary at REMAX is not your agent. The company is.  If REMAX is the agent of both a home seller and the buyer of that home REMAX is a dual agent.  (Note that NJHomeBuyer.com Realty avoids the potential for that conflict by only representing buyers.)

States struggle with agency disclosure requirements because failure to disclose these relationships is a violation of license laws as well as the Realtor Code of Ethics.   Failure to disclose is EXTREMELY common.

The disclosure is required because consumers have a right to know if the person they think of as “their” agent is really in a position to give them the advice and assistance they need.  If that agent’s company is  also representing the other side of the transaction – assistance is limited.  They can’t help either side get ‘the best deal’. They are a dual agent.

The New York State Assembly addressed this (again) with bill A10443 this past June 2010.

The ‘justification’ for the bill states:
“JUSTIFICATION: A statutorily required agency disclosure form is used to provide consumers with information regarding their representation in a real estate transaction. “Dual Agent” is currently recognized in real estate license law as a valid form of agency relationship in which the buyer and seller are represented by the same real estate brokerage company.”

This applies to New York state but is pretty much the same as the justification in other states that recognize and allow dual agency.

Agency disclosure laws vary by state.  Enforcement is sporadic if it exists at all.  The National Association of Realtors has documented, through surveys, that there is a high rate of failure to make the disclosure as statutorily required.  When this is not done consumers don’t have the information they need to make informed decisions about who will represent them in their transaction.

In the area of agency disclosure consumers would be much better off with some consistency nation wide. One national disclosure form would go far to inform consumers – much as the federally required lead based paint disclosure does.   The enforcement issue is difficult for state real estate commissions. It could be simple.

Make the right to receive a commission revocable if the required disclosures were not made.

This is an area that ARELLO ( Association of Real Estate License Law Officials ) should look at.

My name is Paul Howard and I’m an Exclusive Buyer’s Broker in Southern New Jersey.

Paul Howard – NJHomeBuyer.com Realty
Cherry Hill NJ 08002
856-488-8444

http://www.FaceBook.com/HomeBuyers