You have options when it comes to selling your home

You have options when it comes to selling your home

Real estate is no longer a "one size fits all" industry when it comes to how you sell your home.  You can use a traditional agent, a flat fee agent, a flat fee MLS program, an attorney, or do it all yourself.   But how do you know which one to choose?


At Selling Later, we believe that how you sell your home should be based on how much you know, how much time you have, and how much effort you want to put into your sale.  

While we will never tell you to use one service over the other, we do want to empower you to do your research to find what works best for you. To help get you started, here is a quick breakdown between the following services: Real Estate Agent, Flat Fee Agent, Attorney, or Flat Fee MLS.  

Traditional Real Estate Agent 

What services does a good real estate agent provide?
  • An agent will give you advice on how to prepare your home to sell, give you a competitive market analysis (CMA), and a strategy on how they will sell your home.  Once your home is listed, they place the home on the MLS, market the home, manage all showing appointments, and review all offers with the seller to ensure they negotiate a great deal in their client's favor.  A good agent will keep close tabs on all important dates of the contract, inspection deadlines, loan commitments, and negotiate buyer's requests for inspection repairs.  They will attend the closing with or for the sellers after reviewing the final closing documents with them.

Is there anything that is not covered under an agent's service?
  • There is not a lot that a good agent will not do as this service offers the least amount of work for the home seller.

Are traditional agents available throughout the United States?
  • There are almost two million real estate agents located within all 50 states.

What are the costs associated with using an agent?
  • Using an agent is one of the more costly ways to sell your home.  There is not a legally mandated commission rate for this service, however, most agents will tell you that standard commissions rates are between 5% and 6% of the selling price.  This is then split between the buying and selling agent (read more).  You need to know that commission is always a negotiable fee that is agreed upon by the seller and the agent.   The length of your contract with a listing agent is also negotiable.  There are things you can do to help give yourself negotiating power (read more).

What makes a real estate agent differ from other real estate services?
  • An agent has a lot of hands-on involvement, unlike other services. Agents are there through every step to ensure they help the seller sell their home for the best price possible, in the least amount of time and with the least exposure of risk.

What securities come with using an agent?
  • Agents, specifically Realtors, are supposed to adhere to strict guidelines and code of ethics to ensure a proper and safe sale.  An experienced, well-educated agent is that they are trained in the "what if's" and can navigate a seller through those potential pitfalls.

What is the homeowner's role when using a traditional agent?
  • The homeowner must review the CMA with the agent to agree on a sale price, prepare their home for sale, work with their agent to schedule home tours, review offers, selects the best offer, and completes paperwork with their agent to close the deal.

An agent is best to be used by…
  • Someone who does not have a lot of experience with selling a home or does not have a lot of time to commit to the process.

What they don't tell you about this selling service
  • There are a lot of websites that claim to help you "find the best agent for free" or tell you "the best way to sell your home."  However, most of these sites take a percentage of the listing agents' commissions, which chips away at your opportunity to negotiate commissions with your listing agent.  While you can use these sites to research agents, do not contact agents through these websites.  Instead, contact the agent directly through their own websites or social media accounts.     
  • There are also websites that connect you with agents for "free," but they only refer you to agents that pay to participate in the platform.
  • Look for open market place platforms, like Homeopenly, that agents and their lowest commission rates, without companies taking referral fees or pay to play programs.
  • The best agents rely on word of mouth and client referrals and do not participate in referral and "pay to play" programs.   
  • There are almost two million agents throughout the United States, so if the agent you are speaking to refuses to negotiate their commission, know that there are plenty more out there to choose from.
  • If your agent has a lot of listings in your area, know that they probably work with a team.   Ask to meet with their team before signing an agreement with them, as you will most likely end up working with the team members more than the agent.  
  • Always interview a few agents before signing with one (remember that you set the length of the contract).  Each agent will probably suggest a different sales price, so ask each of them how they got to that number and how they plan to market your home.


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Real Estate Attorney

What general services does a Real Estate Attorney provide for a client?

  • A real estate attorney can review and draft legal documents including purchase and sale agreements, leases, deeds, title commitments, settlement statements, and financing agreements. Additionally, they can assist in resolving title insurance and environmental issues and also may play a vital role during negotiations.


What services do they not provide?

  • An attorney will not give you a suggested sale price, suggest how to prepare your home for sale, show the home, or list the home for sale.  


Is this service available throughout the United States?

  • Real estate attorneys are available in every state.  Some states actually require you to use an attorney for real estate transactions.


What are the costs/fees associated with using a real estate attorney?

  • The costs for a real estate attorney vary depending on the attorney's individual experience level along with other factors, including location. Most attorneys charge on an hourly basis; however, some attorneys will charge a flat fee for a particular service (i.e., for reviewing a draft sales agreement).


What makes a real estate attorney different than other real estate services?

  • An experienced real estate attorney can help protect the clients’ best interests and ensure that the transaction adheres to all state and municipal laws.  It is not likely that an attorney will charge a commission which eliminates any personal motivation.  That means the attorney can focus solely on what is best for his or her client. 


What securities come with using a real estate attorney service?

  • Using a real estate attorney ensures that your legal documents are prepared correctly and adhere to all the state laws.  An attorney will be able to address any issues that might affect the property in the future. Additionally, a skilled real estate attorney can help to protect the client from being sued by the opposing party, assure that the real estate being purchased includes all aspects of property rights (ex. oil and gas rights) and assure that there are no title issues (i.e. unsatisfied judgment or tax issue that is liened against the property).


What is the home owner’s role when using an attorney?

  • The homeowner’s role is to prepare their home for sale, set the listing price, market the home, find the buyer, and agree to a sale price.  


A real estate attorney would best be used by…

  • A homeowner or property investor looking to buy or sell a property without a real estate agent.  Real estate is a complex field, and an attorney specializing in real estate will provide valuable assistance to ensure the sale of their property protects the homeowner's liability and follows state regulations.

What they don't tell you about this selling service
  • While attorneys may give you a flat price for their standard service, you should know their hourly rate to budget accordingly if your sale does not go smoothly.
  • Some attorneys will ask you to put down a retainer (a certain amount paid in advance) to cover their services.   You should require that your attorney warns you when you are close to spending all of your retainer so that you are not surprised with extra hourly charges after the sale is complete. 
  • Just like traditional agents, there are a lot of real estate attorneys out there, so check their reviews and ask for recommendations from other attorneys, investors, friends, and family.  


Flat Fee Real Estate Agent –

What general services does a flat fee agent provide for a client?

  • A flat fee agent provides similar services as a traditional realtor.  However, detailed services offered may vary based on which company that you select.   When using a flat fee service, be sure to use one that carries their own real estate agents in specific areas.  


What services do they not provide?

  • Some flat fee platforms cover all services, while others ask that you manage the preparation to list the home and manager the home showings.


Is this service available throughout the United States?

  • True flat fee services, those that have specific agents working for them, are available in most major cities.    


What are the costs/fees associated with using a flat fee agent?

  • The costs for a flat fee realtor will vary based on your service provider and your state.   Most will offer a 1% commission for the listing agents, while others tier their pricing based on the price of your home.  Almost every single flat fee service will have you include 3% to a buyers agent.   This means that even though they advertise 1% commission, you will end up paying 4%.  


What makes a flat fee agent different than other real estate services?

  • Most flat fee agents have very similar processes and actions as regular traditional agents but typically utilize more technology to help the homeowner manage more of the process.  Flat fee agents that work solely for a flat fee agency typically work on a salary instead of a commission-based position.


What securities come with using a flat fee agent service?

  • A good flat fee agent is backed by a brokerage and will advise and navigate you through the process.


What is the home owner’s role when using a flat fee realtor?

  • The homeowner must review the analysis with the agent to agree on a sale price, prepare their home for sale, work with their agent to schedule home tours, review offers, select the best offer, and complete paperwork with their agent to close the deal.  Please note that not all flat fee services are the same, and some may ask you to do more work during the process to complete the sale (ie. handle the showings).


A flat fee agent would best be used by…

  • Someone that isn’t knowledgeable on the selling process, but is tech-savvy and willing to potentially do a little more work for a much lower commission.

What they don't tell you about this selling service
  • Some flat fee services only offer you the lowest listing commission if you agree to also use them as your buying agent
  • Remember that these platforms advertise a low listing commission, but do not normally mention that you have to include 2% to 3% to the buyer's agent.
  • Be sure to ask if the listing agents works specifically for the flat fee agency, like Homie.   Some flat fee services (like Clever) are just a funnel to traditional agents, take a cut of the commission, and make the agent take an extremely low listing commission.  You have to question if that agent will give you the same service as their other clients that are paying a much higher commission. 

 

Flat Fee MLS

What general services does a flat fee MLS service provide for a client?

  • A Flat Fee MLS Listing Service, is a state licensed real estate broker that provides an ‘Entry Only’ service. You pay a pre-set sum of money, and they place your listing on the MLS and make changes to your listing as you move through the sale process.  


What services do they not provide?

  • Unlike a full-service listing, you won’t be working with an agent to handle your pricing, home preparation, showing requests, negotiations and any other activity associated with the sale of your home.


Is this service available throughout the United States?

  • This is available wherever there is a licensed real estate broker. Companies that only do flat fee mls services might be state-specific.  


What are the costs/fees associated with using a Flat Fee MLS?

  • When looking at an average size state, your costs may range from $299 to $500.  This may vary if depending on your state and any additional services you select from the service provider.   You will have to include a buyer’s agent commission when listing, so you will need to factor in 2% or 3% cost to your listing price. However, you only have to pay that commission if your property is sold to a buyer who is represented by an agent. If your buyer is representing themselves, then you will not pay that commission.


What makes a flat fee MLS different than other real estate services?

  • Flat fee MLS is different from other services as the homeowner is doing most of the work when it comes to the actual sale of the home.


What securities come with using a flat fee MLS service?

  • Using an MLS service ensures that your home listing is shown throughout the many MLS systems within your state.   However, the liability of the sale falls on the home seller. 


What is the home owner’s role when using a flat fee MLS?

  • The homeowner is essentially acting as their own agent when it comes to selling their house and assumes the selling agent's typical duties.  While the MLS listings will give them the exposure to compete with other houses, the owner must do the bulk of the work.  When the house does sell, you are to let your listing agent know within one day.


A flat fee MLS would best be used by…

  • Someone that has some knowledge of how to sell a home and is looking to save a lot of money without having to pay the standard agent commissions.


What you need to look out for when using this service

  • Not all flat fee MLS services are created equal.  Ask what specific MLS and websites your home will appear.
  • Most flat fee MLS programs will offer additional services.  Before selecting a service, cost out their additional services so that you can budget accordingly.
  • Regardless of what exposure your home gets, if it is overpriced and photographed poorly, it will be hard to sell.  Get an appraisal before you price your home, stage your home, hire a professional photographer, and get a pre-listing home inspection so that you can fix any issues (or cost them out accordingly).