Professionals can help you sell your home
Who's who in real estate
- A real estate agent, associate broker or broker can help you sell your home.
- A Realtor is a real estate professional who is a member of the National Association of Realtors.
- If selling by owner, consider hiring a real estate attorney to ensure legal compliance.
Beyond the many emotions associated with selling a home, there is the complexity of the transaction itself.
From marketing to negotiating and disclosures to title insurance, there are many tasks involved in a home sale that can be made smoother and less stressful with the help of a professional. It is in a buyer or seller’s best interest, however, to understand who you can hire to assist in closing the deal — and how much their services will cost.
Real estate professional
A real estate agent — also known as a real estate salesperson — is licensed by your state. Agents can continue their education to become real estate brokers or associate brokers. An associate broker has a broker’s license but works under a broker. Brokers have completed education and training beyond real estate agents and can either work alone or oversee a team of agents and associate brokers, while agents and associate brokers must work under a licensed broker. A Realtor is a real estate professional who is a member of the National Association of Realtors.
A homeowner need only work with one of the above professionals, as real estate agents will work with their own broker when handling the transaction. If you are working with a real estate agent, their broker — in effect, their boss — will be the one handling the escrow account and buyer’s earnest money deposit.
Listing agent vs. selling agent
Both listing and selling agents are real estate professionals; however, they represent different parties in the transaction. The listing agent works for the home seller by listing the property on the Multiple Listing Service, marketing the property and showing the home to prospective buyers — working to secure the highest sale price for the seller.
The selling agent works for the homebuyer by assisting in identifying potential homes to view and working to secure the lowest purchase price for the buyer. The seller pays the commission for both the listing agent as well as the buyer’s selling agent. The listing and selling agent split the sales commission, typically totaling 6 percent. Sometimes an agent will represent both sides and collect the full sale commission, but the conflict of interest makes this less common.
Real estate attorney
Unless your property has significant damage or is carrying liens and other judgments, the knowledge of a real estate agent alone is likely enough to complete the closing. If you are selling your home without a real estate agent, however, it is imperative to hire an expert real estate attorney to handle the contract, disclosures, closing paperwork and regulatory and tax filings to ensure the sale complies with state law. Because a homeowner working without a real estate agent will still have to work with the buyer’s agent, inspector and appraiser, it is important for that homeowner to have a legal professional who can oversee the paperwork to protect the seller’s interests. Depending on your city and the complexity of the transaction, the services of a real estate attorney can cost between $1,000 to $2,000, with some attorneys charging a flat fee per service and others billing an hourly rate.
The title company assesses whether you have the legal right to sell your home, issues title insurance — which insures against the loss of ownership because of legal defects — and typically handles the escrow account, and conducts the loan closing. Generally, the buyer or seller can hire and pay for the title company’s services, and it is treated as a negotiable expense. Typically, however, the seller pays for the buyer’s title insurance — about $500 to $1,000 — and the buyer pays for the mortgage insurance, when it is required as part of the loan deal.
Depending on your experience, time and finances, hiring one or more of the above professionals can potentially help make the homebuying and sales process easier. Of course, these professional services come with oftentimes significant costs, so it is always smart to get recommendations and shop around before making your decision.