Naperville Real Estate

Truth About Real Estate

Real Estate Agents/ Brokers

Ok, here you are visiting our real estate website... You are a potential homebuyer and you are using the Internet to learn more about real estate and to understand your real estate options.

When choosing a Naperville real estate agent/ broker to work with, make certain that you know who your real estate agent is really working for.

Is your agent working for you, the buyer, or the seller? Just remember, when you call the broker whose name is on the sign or, in a newspaper or a magazine ad, they're ALWAYS working for the seller.

Why would you contact that Real Estate Listing Office for information about a home, when you know that they are under contract with the Seller?

Home buyers and home sellers have opposing interests. The seller wants the best price and terms, and so does the buyer.

Do you really think that one real estate agent can properly represent both You the buyer, and the seller?

Why don't you read about this "conflict of interest situation" in the newspaper?

Very simple answer - money! Look at the real estate section of any local or regional newspaper, lots of houses being advertised by real estate agents. Those newspapers don't run those ads for free. As a result the buyer's only source of accurate information has been an occasional story aired nationally by the major television networks or magazines.

Is there a downside to using a real estate Buyers Agent to help you locate and purchase your next home?

There is no financial downside. A buyer's agent's commission is paid by splitting the seller's agent's commission, which was negotiated with the seller at the time the home was listed for sale. If there is no buyer's agent to pay, then the seller's agent usually keeps the entire real estate commission. Without a buyer's real estate agent the best you can expect is the selling agent represents neither party, but most likely they represent only the seller. A real estate buyer's agent in most cases is also in a better position to negotiate a lower sales price than a homebuyer because they have access to current comparative home sales information.

Five types of Real Estate Agents:

1. Listing (Seller's) Agents:

In Illinois, real estate agents who represent the seller are responsible for the following duties:

Promote the interest of the seller with the utmost good faith, loyalty, and fidelity.
Protect the seller's confidences.
Present all offers in a timely fashion.
Advise the seller to obtain expert advice.
Account for all money and property received.

Disclose to the seller all adverse material facts about the buyer that the agent knows, including their financial ability to pay more for the home and their motivation to buy the home.

Disclose to the buyer all adverse material facts actually known by the agent, including the following: physical condition of the property, environmental hazards, material defects in the property or in the title to the property.

This agent is hired by the seller to market and sell his or her home. This agent/ broker is required by Illinois law to work for the best interests of the seller and to do his best to obtain the best price and terms for the seller.

2. New Home Sales Agents:

These are the sales agents that work at the "model" homes in many planned communities. These Real Estate agents work for the Builder or the Developer. Their job is to sell you the property at the highest price and most favorable terms for the Builder or Developer. They are usually restricted to selling only the homes of builder/ developer.

As a buyer, you need your own representative, a buyer's agent, to get the best deal on upgrades, other amenities and, of course, price and terms.

3. Exclusive Buyer Agent:

An exclusive buyer agent is an agent that is associated with a real estate broker that does not list homes. This agent and broker will never in any instance represent the seller or have any of the ethical conflicts that the traditional broker will have in trying to serve both buyers and sellers. The exclusive buyer agent will always owe his/her fiduciary obligation to the buyer. In Illinois, the exclusive agent who represents the buyer will be responsible for the follow duties:

Promote the interest of the buyer with the utmost good faith, loyalty, and fidelity.
Protect the buyer's confidence.
Present all offers in a timely manner.
Advise the buyer to obtain expert advice.
Account for all money and property received.
Disclosing to the buyer all adverse material facts the agent knows.

4. Buyer Agent (associated with a broker who lists property for sale)

People representing themselves as a buyer's agent could be misleading you. "Agents" must work for brokers. The broker is officially the person who is responsible for the listing and entire transaction. If a broker has two agents, and one lists a home and the other agent(your agent) shows you the home, they cannot be a buyers' agent because they work for the same broker. Effectively the agent only represents the broker and if both agents work for the same broker (even though one has listed the home and one is your personal agent), the fact is that they both work for the same broker. So in the true sense - they are not a buyer's agent. The broker is in charge, the broker is considered the one who is responsible. A true buyers agent would have to be a broker who absolutely does not take any listings or an agent who works for a broker who does not take any listings.

These buyer agents are responsible for the same duties as the exclusive buyer agent. However when these agents show a property listed by their company to their buyer, the agency status will change to either a disclosed dual agent or a designated agent. The disadvantages of being served in these other statuses are:

Disclosed dual agents legally represent both the seller and the buyer. Law firms gave up trying to represent both plaintiffs and defendants years ago because they learned there were too many conflicts. Buyers should know that traditional brokers are most likely to favor the sellers in these situations because most of their service is oriented toward the seller.

Their broker appoints designated agents. One agent will represent the buyer and another of the broker's agents will represent the seller. The major drawback with these appointments is that the broker can not legally supervise the work of the agents.

Transaction brokers are a classification that was legislated in some states to give the brokers a legal right to supervise their designated agents' work. The brokers in these incidences have no agency requirement to either the buyer or the seller. This limits the broker's liability to the buyer and gives the buyer less protection than they can receive through the service of an exclusive buyer agent/broker.

5. Dual Agents (Transactional):

This firm wants to offer buyer agency services to buyers while still hanging on to their listings. They promise to get sellers the highest price unless there is an agent from their office who is acting as a buyer's agent. In this case they represent both the buyer and the seller without giving full service to either. This conflict of interest is bad for both the buyer and the seller but great for the company because they get to pocket both sides of the commission.

It is very important to understand the difference between the different types of Real Estate agents!

Choose your real estate agent wisely.

Remember, it's your money and your potential future home. Exclusive Buyer's Agents are on your side!

Do you know that the difference between the best real estate professionals and an average real estate agent can often mean thousands of dollars to you as a homebuyer? Why use the services of an average real estate agent when you can work with one of our area's best real estate professionals? Think of us as more of a home-finder for you in Naperville ... and we believe we are the best you will find in the home finding business. Believe it or not our services are 100% FREE to YOU!

Our goal is to help you find and purchase the right home for you!

We handle the whole transaction, all the paperwork, all the disclosures, and protect you in the transaction, as your agent, all at the same time. Now, that's what we consider our job ... and best of all -- there is never a charge to the buyer (that's You) for our home finding services!