When you are in real estate for as long as we have been, we spend a lot of time unraveling real estate myths. Like many industries, there is a lot of misinformation that inundates consumers. And when it comes to owning, buying, or selling real estate, it can be downright brutal to tell the myths from reality.
And this is why we are excited to introduce our new mini-series: Real Estate Myths: DEBUNKED, with Kevin Methvin. Stay tuned for the TRUTH in Real Estate.
MYTH #1: Buyers Pay For A Real Estate Agent
First-time homebuyers often think one of the costs of purchasing a home is paying for a real estate agent to represent them in a transaction. And although homebuyers should indeed seek a local real estate professional to represent them while purchasing a home, they do not have to foot the bill!
THE TRUTH: Sellers pay for real estate agents. Although surprising to some, the home sellers cover the cost of the LISTING and the BUYERS agents.
In most typical transactions, the LISTING agent charges a commission to sell the home. In turn, when a BUYERS agent presents the listing to buyers, who purchase a home, the LISTING agent offers a commission slip to the other agent to acknowledge the other agent helped get the house sold.
Remember, you can’t sell a home without a qualified buyer! Local real estate professionals know they have to work together to serve their clients best. It only makes sense that the most successful transactions are those where the Realtors work to ensure successful closings for both the buyers and the sellers involved.
MYTH #2: You need 20% down to purchase a home
Perhaps at one point in lending history, having a 20% down payment on a home purchase was the norm. But, like all things in life, things change.
The truth: Lending options are as diverse as the people who purchase homes. In fact, it was once said that mortgages are like snowflakes, no two are exactly alike!
Today, there are an incredible variety of lending programs available to home buyers. From traditional loans, grants, and programs specific to lending institutions, professionals, and even public servants, it is hard to say what an expected downpayment is in today’s market.
The best thing to do is to reach out to a local real estate professional and ask for some referrals. Local lenders are critical assets to a successful real estate transaction. If you are thinking of buying, give us a call, and we are happy to refer you to our Preferred Partners.
MYTH #3: Finding a house is the first step in buying a home
We know house shopping can be enjoyable. And, it is effortless to see an “Open House” sign and stroll on in. Plus, we know finding “THE PERFECT” house is essential. But, it is still a myth.
The truth: You must get pre-approved for finance BEFORE you start to house-hunt.
There are some fundamental reasons for this.
First, until you are pre-approved for lending, you have no idea what your budget is for a new home. And without a budget, it is easy to fall in love with a home that you cannot afford. And nothing is more disappointing than learning you cannot purchase the house you fell hopelessly in love with.
Second, sellers will take you much more seriously if you show up with a pre-approval number in your hand. They will see you are a legitimate, qualified buyer and want to learn more about your home-buying preferences. If you show up unprepared, they might not give you a second glance. This gives you better bargaining power, too!
Ultimately, getting pre-approved saves you time, increases your credibility as a buyer, makes you more confident shopping, AND invites shorter closing times to get you into the door.
Give Us A Call: We Are Here to Help You Prosper In California
At Prosper Real Estate, we believe that education is one of the most powerful tools you can have in your belt when it comes to real estate. Instead of getting caught up in what you think you know because you heard it through the grapevine, give us a call.
We have been leaders in the local real estate market for nearly 20 years. If you count cumulatively, our team brings decades of insight, knowledge, and experience to our clients.
Stay with us as we continue to highlight myths and showcase the reality of real estate. And, like always, we invite you to call, email, or stop by our office to learn how we can help YOU, Prosper in California.
Call or text at 925-819-102, stop by our office at 141 Sand Creek Rd, Suite D, in Brentwood, CA, or email us at [email protected] Stay up to date with us by following us on Facebook, Instagram, and YouTube. Local review sites, such as Google Business and Yelp, are also great ways to learn more about the work we do, the communities we serve, and our incredible clients.