Whether you’re buying or selling a home, make informed decisions by doing your due diligence
What are my obligations as a buyer during a real estate transaction?
Good for you for asking one of the most important questions you need to answer before entering into a real estate deal.
An informed buyer is a smart buyer, and being fully aware of your obligations as you begin to search for that perfect home will help set you up for success.
Your responsibility from the outset is to do your due diligence and make informed decisions. You are ultimately accountable for all the choices you make.
It is always wise to speak with a few real estate agents before deciding on one that you are most comfortable with. I would also highly recommend that you visit the Real Estate Professional Search tool on RECO’s website, to confirm that the sales rep’s registration is active and in good standing.
If you decide to work with a brokerage, your due diligence starts with reviewing and understanding the buyer agreement. This is a contract between you and the brokerage in which they commit to helping you buy a property and you agree to work with them for an agreed-upon period of time — typically exclusively.
Before you sign an agreement, your real estate agent will explain the service options available. For the decision you make, the agreement will set out the rights and responsibilities for you and the brokerage. It is your responsibility to carefully review and ask questions during negotiations, to make sure you understand everything fully.
An agent is required to advise you about the details of a multiple representation — when an agent or brokerage represents both the buyer and seller — during a transaction. It will be your responsibility to get the information you need to understand the circumstances and what the impact will be to you, and to make a decision about whether you agree to multiple representation.
Some other obligations you have are to communicate in a timely manner with your agent, to be fair and honest, and to provide them with accurate information about your finances and your needs. You must also agree to submit any offers only through your brokerage, which will then present and promote them to sellers on your behalf.
If you have placed a deposit, be actively engaged in the decision about where the funds will be held in trust.
As well, you should know that if you find a property on your own and decide to submit an offer without involving your salesperson, you may still owe the brokerage a commission if the agreement is still in effect and the seller accepts the offer.
A final piece of your due diligence is making sure you are seeking advice and have appropriate support from third-party professionals, whether that be a real estate lawyer, accountant, appraiser, home inspection service, photographer, or other experts.
While you always have the right to represent yourself in a purchase or sale, be mindful that it is not something to be taken lightly. Agents can offer a wealth of knowledge and experience gained from working in the real estate sector, and are licensed professionals trained to protect your interests while supporting you to navigate the largest purchase you will likely ever make.
If you have a question for Joe about the home buying or selling process, please email [email protected].