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6 Misunderstood Things About Buying & Selling Houses

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Surprises are fun for birthday parties, scratch-offs, and finding an extra mint Milano at the bottom of a Pepperidge Farms bag. They’re quite the opposite when it comes to buying or selling a house. We’ve compiled the weird, the bizarre, and the generally misunderstood real estate facts to hopefully reduce any surprises the next time you’re on the market.

#1 “Selling” vs. “listing” agent terminology is misleading.

In layman’s terms, it’s a mess. Full disclosure, this writer has written for RealtyHive for more than a year and still struggles to keep the two separate (but thankfully has a real estate grandmaster for an editor).

The listing agent works with the person who posts the listing (in other words, the seller). The selling agent works with the buyer — this role is also sometimes referred to as the buyer’s agent. Ideally, that jargon would just make a permanent switch.

Oh, and did we mention that sometimes the listing and selling/buyer’s agent are sometimes the same person? This is called dual agency.

#2 You can’t fire your Realtor just because they haven’t sold your house.

You can work to fire a Realtor who is unethical or irresponsible but minor issues (or even the lack of a house sale) is usually not grounds to terminate your contract. Even if you stop working with your Realtor, there’s a chance that they could still take commission on your property.

If issues come up with your Realtor, talk to them first, then follow up with their broker if you don’t feel like things are working. 

#3 Houses that have spent a long time on the market are often overpriced.

If you spot a house that seems overpriced and you can’t figure out why, chances are it’s been on the market for a while. This can serve as a good bargaining tool if you decide to make an offer — you can try going lower than the listing price. 

Otherwise, keep an eye on listings consistently, specifically for ones that stay up for several weeks. Even if the price doesn’t change, you could still leverage a lower offer.

#4 Hope for a low assessed value.

While you want a high appraisal value (because that tells how much your home is worth and helps for selling), you want a low assessed value because that determines your property taxes.

#5 When you’re looking to buy a house, never call the listing number. 

The “For Sale” sign might look enticing, but don’t call the phone number. That number belongs to the listing agent who, like we discussed earlier, works on behalf of the seller. Contact a selling/buyer’s agent when you see a property you like (and consider working through Cashifyd since you could get cashback at closing!).

#6 Real estate trusts and wills are different.

Wills are usually for smaller assets, trusts are typically for larger ones. Real estate trusts are also private and can eliminate court time while wills can lead to lengthy court stints to divvy things up.

Real estate is one of those areas in life where the more you learn, the less you know. Or at least, it can feel like that. But by researching, learning and staying up-to-date on real estate blogs, you’re actively closing the gap on any unintended surprises — and becoming a well-versed buyer or seller in the process.

The Key Players in Real Estate

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The game’s about to begin, a real estate transaction is about to take place, and the starting lineup has just arrived. While the real estate agent might seem like the quarterback or point guard, there are plenty of other positions that play a vital role. These are the key players to know about — they help house sales go through and one day, will help your transaction as well.

Mortgage Lender

A mortgage lender is a financial institution (usually a bank) that provides financing (a loan) for a real estate transaction. Before buyers even start looking at houses, they need preapproval from a bank to show they’re serious — sellers often reject offers that don’t have preapproval.

Mortgage lenders also work with appraisers to ensure they approve the correct amount for a loan. If the value of the property doesn’t match the loan amount, this can make it more difficult to get a mortgage.

Home Inspector

People putting an offer in on a house often include a contingency for home inspections. In other words, if a home inspector finds some major problems and the offer is based on the results of an inspection, the potential buyers are protected from having to go through with the sale.

One thing to note is that not everyone opts for an inspection. Investors looking for flips or rental properties often put in offers that don’t require an offer so they can get the property faster and for a lower price. But if you’re looking for a home to live in, working with a home inspector is a really good idea.

Appraiser

Appraisals are different from home inspections because they assess the value of the home, not the condition. As mentioned, appraisers are usually sent out by banks to double check the value of the property.

Agents

There are two crucial agent roles you need to know:

  • Listing agent: Works with the seller (the one who’s posting the listing). Whenever you see a “For Sale” sign with a phone number on it, that’s the listing agent.
  • Selling/buyer’s agent: Works with the buyer (the one looking to buy the home).

To make matters more confusing, sometimes the listing agent and the selling/buyer’s agent can be the same person! Learn more about dual agency in our 5 Things Real Estate Agents Don’t Want You to Know blog.

Brokers

Brokers are legally responsible for the agents who work for them. They carry Errors & Omissions insurance, and if issues come up for (or with) a real estate agent, the broker is the one who can step in.

The listing broker is the listing agent’s boss and the selling or buyer’s broker is the boss of the buyer’s agent. It’s not often that either brokers interact with the buyers or sellers (unless there’s a problem with the agent).

Title Company Representative

Title company representatives do the actual closing of a property and serve as a neutral third party. These reps release funds from both sides and ensure that everyone has fulfilled their obligation.

Real Estate Lawyer

With all the documents that need signing in a real estate transaction, it’s no surprise that some people hire real estate lawyers to help them work through the paperwork. Sometimes people opt for a real estate lawyer to take the place of an agent and/or broker.

Transaction Coordinator

Transaction coordinators are the playmakers from behind the scenes. They iron out deadlines and details, communicate to all parties involved, enter listings into the MLS and check over closing documents, to name a few things. Essentially, they do everything except show houses! Not every brokerage or agent has a TC but many do.

You

Yes, you! As the buyer or seller, you are one of the biggest players in a real estate transaction. You are the reason every other role exists and why they’re coming together in the first place. But if looking at this list has you feeling about as overwhelmed as a soccer coach for 3-year-olds, fret not. 

You can work with RealtyHive, a one-stop-shop that makes the buying and selling process easier than ever. Find agents (and potentially get cashback at closing), list your property, or bid on your new home in one of our time-limited events, all in one place. In other words, play ball!

Procuring Cause: The #1 Reason Why You NEVER Call a Listing Agent

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You’re driving through a neighborhood when suddenly you see it. The house you’ve always loved at a distance, now with a “For Sale” sign in the front. Excitement bubbles up and you pull over to get the phone number on the— STOP RIGHT THERE.

Do NOT call the number. Calling this number throws a real wrench into a lot of people’s plans, and could even shortchange you thousands of dollars. Here’s why:

Whose number is on the “For Sale” sign and why shouldn’t I call it?

That real estate agent is known as the listing agent, and they work for the seller. You don’t want to work exclusively with them because the listing agent has the seller’s best interests in mind. But there’s another reason not to work with them, and it’s called the procuring cause.

What is the procuring cause?

Let’s say you call the number on the “For Sale” sign and work with the listing agent, named Lisa. You meet with Lisa and she shows you the property. 

Now that’s all fine and swell, but you actually want Bob the buyer’s agent as your Realtor because you know he will represent you best. However, since Lisa already showed you the property, she could say that she actually gets Bob’s commission because of the procuring cause (she already showed you the house). This inadvertently throws Bob under the bus.

How can I avoid the procuring cause?

The easy answer is to not call the number you see on the sign. Not only does that protect Bob’s commission, but it could protect thousands of dollars that you could get as cashback at closing by using Cashifyd.

How does Cashifyd work?

Cashifyd is a way for you, the buyer, to take advantage of realtor referral fees and get money towards your closing costs. It’s simple to use and should be every buyer’s first step! Here’s how it works:

  1. Tell us about the property you’re interested in.
  2. Submit your info.
  3. Hear back from agents about offers and cashback.
  4. Pick your agent and connect with them.
  5. Buy the property, get cashback at closing!

The next time you look through our listings or see a property you’re seriously interested in, don’t call the listing agent. Don’t run into the procuring cause. Do get connected with Cashifyd to find a real estate agent near you who’s looking out for your best interests. It’s easy, it’s fast, and it leaves you with solid cashback to help with closing costs — it’s the only way to go.