real estate agent or attorney?

C

CurlyQ

Cathlete
I'm hoping some of you will be able to back me up in a disagreement I'm having w/ my dh (the d is not for dear in this case):) We've found a piece of property that we want to put an offer on. This is our first time buying real estate (or attempting to). DH thinks that a RE agent or attny isn't necessary since it's just land, I disagree. I think we need someone representing us that knows the in's and out's, and to ask questions we wouldn't think to ask, etc. I don't want to be in a "dual agency" type of negotiation with the selling r.e. company.

Land/RE is ridiculously expensive in this area (NH), so we are trying to find ways to save money on this deal which is why dh doesn't want to pay commision or att'ny fees. We aren't planning on building a house on the property for a year + so that we can pay on the land and borrow against it for part of a construction loan.

Any advice would be greatly appreciated :)

Shannon

p.s.- I realize I can call an agent and ask these questions, I just wanted to get some non biased advice here first.
 
I hit the reply button before reading your request for "non biased advice"...

I work as a law clerk for a real estate attorney in California, where land is pretty darn expensive, LOL. A million bucks for a 3 bedroom fixer upper is pretty common!

Anyway, to put it plainly, you would be absolutely FOOLISH to enter any kind of real estate transaction without a knowledgeable agent (who has a fiduciary duty to you) representing you. Either a reputable real estate agent from a trusted agency, or an experienced real estate attorney should be your first stop.

As you said, land is expensive in your area, so treat it as a valuable investment. Saving money on having a knowledgeable person represent you is simply not a place to cut corners!!! Ask around, TALK to the person you want to have represent you, ask them what their responsibilities are to YOU if you aren't comfortable with their commission. (BTW, they should be explaining all of this to you without your having to ask too many questions!!)

Ooh I'm giving far more than my 0.02-- I think I'm up to a quarter now!! :eek: Sorry!! :D Good luck finding the land of your dreams!!!!
 
I don't mind if RE agents on this mssg board respond, I just figured if I called an agency they'd give me a more biased view :) Thank you for responding, I totally agree w/ you. I think a well versed RE agent will be able to save us money - the hard part is convincing dh that I'm right!
 
What happens if there is a problem with the land that you discover AFTER you've purchased it?
- someone else owns it
- someone else who did own it sold it to two different people
- there is a hazardous materials well that is underground on the property, seeping dangerous poison into the neighbor's land, and the person who sold it to you didn't tell you about it
- the land floods every 3 years and you have to pay to have it treated every third year, but no one told you about it
- the property line the neighbor told you exists at line X actually extends your property beyond that, to line Y

From whom do you recover your time and money if you didn't have help purchasing the property??

(I can think of more, just trying to scare your DH.) These are all real situations people face every day! Good luck! :D
 
Shannon, maybe things are different in your state. In New York, I haven't seen a real estate agent represent a buyer. But maybe they do that in other states?
-Nancy
 
Here is what I say:

Use an attorney, you dont need a real estate agent. During closing, you will get title insurance that will protect you against encroachments, easements, set back lines etc. You will also need a survey. The bank that does the financing will also perform some due diligence as well, so you would find out about any major issues from them. The bank will get a flood letter making sure it is not in a flood zone. Environmental reports are not usually done on raw land unless the loan is over a certain amount. At my bank, it is $500,000. But you could request a "Government Records Search" but there would be a fee.

I really wouldnt be that worried about raw land. Since it is not improved, I think you will be OK with just an attorney. In my neck of the woods, atty fees would be about $350, plus all the other closing costs. Not cheap.

By the way, I am a commerical real estate underwriter.
 
If it were a house we were looking at I'd definitely be going through an agent, but where it is just land I agree with the attorney advice. The soil has been tested, it's good. The topography of the land lends itself to good leach field and well sites. There is no chance of flood, it's on the top of an extremely steep hill. It's a really nice, private piece of wooded property, 2.44 acres. I'm really excited about it but trying to keep my excitement in check in case it doesn't work out.

Nancy, it's unheard of to not use an agent when buying (unless it's a For Sale by Owner property), there are actually quite a few buyer's agent only agencies around here. I can't imagine dealing w/ a seller's agent for a house, seems like the buyer's best interest would be compromised.
 
Most people who are looking to buy a house, hire a real estate agent. That agent can look property up on the MLS system to find houses for you to look at, in your price range. In addition, you can sit in their car and they will cart you around all over town. If you run upon a house that is for sale by another agent, they both split the commission. But both are represented by different agents, which makes a good scenario.

Personally, I wouldn't use a real estate agent because I have been in real estate for 15 years. But most people dont know what I know.

For raw land, I would use just an attorney.
 
CurlyQ, that's interesting. I know there are states where attorneys aren't used at all, and I guess in that case the buyer would also have to be represented by a separate agent. In NY, everyone is represented by an attorney and the RE agent is just a facilitator.
-Nancy
 
You didn't state if this was a FSBO (for sale by owner) or listed through a real estate company??? If it's listed, than I would find someone else to represent you (not the listing agent)...I AM a real estate agent, and working with the listing agent, if they aren't on the up and up, can work against you...Though I have to pretend like I'm working for 2 seperate companies, not all agents feel that way when representing a buyer AND a seller in the same transaction...

If NOT listed, a RE attorney could be cheaper in the long run (if problems arise), with less liabiltity on the buyer, more on the attorney...This will be cash out of pocket at close...

If listed, then find a real estate agent that has been referred to you by family and friends...Yes, they'll take a cut (included in the listing/purchase price), but well worth it (if needed down the road) in the end...

In the long run, ask hubby if his peice of mind is worth a few hundred bucks (break it down to $ per month if need be)...

Just so you know, this is an UNbiased opinion, and one that I had BEFORE obtaining my real estate license!!!

Hope this helps?
MJ in MN

Edited to add, ALWAYS buy title insurance...ALWAYS!!!
 
Another Minnesotan here, one who used to hold a real estate broker's licence:

Land purchases almost demand some sort of professional representation or counsel, if the buyer and/or seller does not have any professional training in real estate law. This isn't a beach ball you're buying, it's real property, and real property can mean real headaches if even the most de minimis thing goes wrong with the transaction, OR if even the most deminimis thing is wrong with the property. Trained professionals can help you avoid that.

In Minnesota, real estate brokers and salespeople pretty much own the real estate market; attorneys are seldom part of the negotiations or closing. I know, however, that many states do things differently.

A-Jock
 
Thanks for everyone's help. Trust me when I say that I'm aware that we aren't purchasing "a beach ball", and that this is a huge purchase/ decision. I actually had a real estate licence years ago but was in and out of an agency before I ever completed a transaction - too much reverse age-ism and politics for my taste, but that's a whole other post. I know about title insurance, etc. I was really just looking for some examples of what could happen through experiences you've had so that I could relay them to dh, which I got, thanks everyone :) I'm meeting up with a friend who is an agent tonight, I let you know how things pan out - if at all.
 
Hi Shannon,

I'm a real estate agent and I completly agree with Amy G. Get a real estate agent and an attorney pronto!!!

Good Luck!
 
Shannon,

I am local to your area and an attorney. My firm does conveyancing of real estate. I tell you this so that you know that I am speaking from experience...

Get an attorney. It doesn't matter if there is land or a house or both, the chain of title has been passed along, mortgages have been recorded, land issues have occurred. You don't want a piece of properyt that you can't do anything (or the thing that you want) with but that you get stuck with b/c you didn't find it out in time. The attorney will be the one that looks at all of these issues and makes sure that wehn you are finished, you have the property that you want and the issues are all resolved.

In NH, there are potentially several parties involved in the transaction. The listing agent is the party that lists the property for sale. The selling agent is the person that finds a buyer. This person *can be* the same person as the listing agent (which is called the "dual agency"). Both the listing agent and the selling agent represent the seller, are paid by him and owe him the fiduary responsibility. The Buyer's broker, if you choose to have one, is someone that you hire (and pay) and they have a fiduciary duty to you.

If you have already found the property, in my opinion, you don't need a realtor. If you need help finding a location, get a realtor. That is what they do best!

Think of it this way. You spend about $200K - ______________K on a house these days. Spending a thousand or two on representation is a very minor expense to make sure that investment is what you intended to buy and is as worthwhile as you thought!
 
Actually, in New York State there is Buyer Agency. By law, you sign an agency agreement and if you agree to Buyer Agency, the real estate agent has a legal obligation to represent you in a professional and honest manner and owes you their full loyalty, among other fiduciary responsibilities.
 
Bubbles, you're right. My real estate dept. just told me that there are agents for buyers these days.
-Nancy
 
I agree with you 110% Shannon! When DH and I bought our home (this is our FIRST home), DH was being hard-headed and waaay too trusting and made some SERIOUS mistakes because he didn't want to listen! You need to do everything by the book and take NO chances! I would DEFINATELY make sure you have someone in your corner who knows what's going on! It will be worth the extra $ IMO. :)
 
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