I recently wrote a post, You Have Had your Home Inspection, What’s Next?. As a result I got a call yesterday from a very nice gentleman who wanted my advice on his situation.
He is in escrow on a home and had paid $5,000 over the asking price. The inspection showed some problems that were going to cost around $2,000 to fix. He had submitted a request for repair, and the seller countered back that they would pay half. He was asking me what I thought.
I asked him what his agent was telling him and he said that the agent was representing both sides.
How comfortable would you feel in a negotiation like this knowing that the seller is paying the agent’s commission? How hard do you think your agent is going to be pushing for you?
It happens that there were multiple offers on the property including all cash. Do you wonder why the winning offer was one requiring loan approval vs an all cash offer? I would hazard a guess it was because the agent is going to get both sides of the deal. Good for the buyer right? Wrong. This buyer may get the home, but at what price!
My advice in this instance was for him to go back to his agent and push some more. After all the agent is not going to want to lose a deal that will net him more money. However, if the buyer had his own exclusive representation he would not have been calling another agent for advice, and who knows, maybe he would have paid less for the home in the long run.
When buying a Los Angeles home, get your own representation. It will pay off in the end.
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