Source: Insider —
Buying a house is already a difficult process, and compounding that with an unhelpful — or even devious — real-estate agent as a co-pilot can add stress and even unnecessary costs.
Purposefully confusing contracts and some real-estate agents’ self-serving motives have some homebuyers getting themselves into tricky positions, said Douglas R. Miller, a veteran real-estate attorney in the Minneapolis-St. Paul area.
Miller is also the executive director of Consumer Advocates in American Real Estate, a nonprofit that deals with consumer protection in residential brokerage, title insurance, and real-estate related legal services.
He said he’s seen homebuyers jump through unnecessary hoops that end up costing them, especially during the housing-market frenzy that was 2020 and 2021, when some buyers felt rushed to purchase a home. (It’s worth noting that some of those buyers already regret their purchases.)
While real-estate agents can help guide you on the right path to homeownership, Miller said they can also be destructive in their attempts to line their pockets.
He’s seen agents sneak unrelated fees into contracts as well as represent both buying and selling parties without disclosing it, which can be detrimental to unbiased negotiation. It’s more common than you’d think, he added.
Miller laid out six of the most important things to be on the lookout for in your contract when buying a home and working with an agent.
You can (and should) negotiate your right to cancel
If you’re unhappy with your agent, you should have the ability to walk away without drama.
Yet, a buyer’s agent, who works with potential buyers to help them find the right property, might make it hard to do just that, Miller said.
“If you are working with a trusted individual, like an attorney or a doctor, and you don’t like them, you need to be able to walk away and go to somebody else,” he said. Miller said it’s essential to ensure any contract signed with the buyer’s agent early on includes a right to cancel clause, where agents or brokers can be dismissed without repercussion to the client. He added, “Brokers can hold you hostage if you don’t have a right to cancel in the buyer-broker contract.”
Buyers’ agents can sneak terms into fee agreements where even if you relieve them of their duties before a purchase is made, they may still be entitled to a commission months down the road.
