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Buyers Representing Themselves

Otherwise Known As You Have a Fool for a Client

Prospective buyer calls me on a listing.  That listing happens to be under contract but there is a very similar property available very close by, which I offer to show them.
Nope.  They have already set an appointment with the listing agent for tomorrow at 3 P.M.
I ask if they are planning on working with a buyer's agent, and they say no, they are going to go it alone.  They are going to represent themselves.  
Apparently they had a bad experience with their last agent.  Which is too bad, and I am sorry for that, but because you ran across one bad agent, does that mean you shouldn't try to find a GOOD agent?
If you had a terrible experience with a dentist, would you start doing your own fillings?
And here is my FAVORITE part.  When I asked how they planned to negotiate any offer, if they find a property they like, they said they are going to have their lawyer negotiate and draft their contract.
Oh good lordy, are you KIDDING?!?!  There are so many things wrong with that approach, I don't even know where to begin.  First, if the lawyer is not local, s/he won't know what the H*LL s/he is doing.  Second, that is the quickest way to screw up a potential transaction, have your attorney friend lawyer the d*mn thing to death.  And third, it will end up costing you a bloody fortune, if the lawyer charges by the hour, as most do.
And I AM a lawyer.  So I know of what I speak.
I explain that the listing agent represents the sellers, and all they are doing by "representing themselves" is giving the listing agent a windfall. S/he will do no work, other than ministerial work, and s/he will get a windfall, double paid, the full 6% rather than the typical 3%.
Agents even have a name for this.  They call it "doubleshotting."
Nope.  These folks are just fine with that.  They don't mind, let the seller pay the listing agent whatever they want.  They are going to try it themselves.  With their lawyer.  Somewhere.  Who probably doesn't even do real estate transactions as his or her main business.  Sigh.
Geez.  Ever heard that saying that "A lawyer who represents himself has a fool for a client?" Well, substitute "Real estate purchaser" for "lawyer" and you have this situation covered.
Here is what you DO NOT GET if you either go in unrepresented OR if you consent to allow the agent to do dual agency, which is legal representation of both the buyer and the seller. 
  • Representation during negotiations;
  • Knowledge about the market;
  • Knowledge about recent comparable sales;
  • Insight into best practices, especially in an extremely hot and competitive market, for how to write a compelling offer; and
  • Knowledge about legally required disclosures. 
I could go on.  But what's the point.  Bad, bad, BAD decision.  Maybe it will work out for these folks.  I certainly hope so.  But I'd bet a dime to a donut it doesn't.

- Melissa

(804) 986-3993

Twitter:  @mikemelissarva
Instagram:  mikemelissarva
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