Responsibilities of a Real Estate Agent

Responsibilities of a Real Estate Agent

A real estate agent is someone who holds a state license and represents a buyer or a seller in a real estate transaction. Real estate agents are the people you deal with face to face when buying or selling a property. Agents execute many functions, such as showing homes to perspective buyers and negotiating transactions on behalf of their clients. Agents work on a 100 percent commission basis, which means their pay depends on their ability to find properties suitable for their clients and to close transactions. The purpose of this article is to discuss the responsibilities of a real estate agent.

The First Step is to Guide: Prior to touring a home, an agent will need to understand their client’s budget, preferences and wants/needs, as well as their motivation. They will then narrow the search and identify each priority.

The Second Step is to Educate: A real estate agent should offer information on homes in the local market and comparable sales. This process can be complicated and a good agent will advise and counsel the client every step of the way.

The Third Step is Networking: A real estate agent must be familiar with the target neighborhood and know the homes for sale before they are formally listed. Experienced agents should know and have a good working relationship with other agents in the area. Additionally an agent should be capable of referring a client to trusted professionals such as lenders, contractors and home inspectors.

The Fourth Responsibility is to be an Advocate: Buyers should work with an agent who can fully represent them. Your agent should be an expert who is looking out for your best financial interests and is contractually bound to do everything in their power to protect you.

The Fifth Responsibility is to Negotiate: A Real Estate agent handles all the negotiation details such as preparing all offers and counter offer forms. After the home inspection is complete, an agent can be beneficial in making sure the repairs are done in a timely fashion.

The Sixth Step is Managing Minutia: A good real estate agent understands the deadlines and details of all the paperwork involved in a deal and can help navigate this complex process. They will make sure all the boxes are checked, all initials are in the right places and all the paperwork is complete before submission.

The Seventh and Final Step: The final role of a real estate agent is to “look out” for you. Any form of errors can damage a deal before its closing. These errors can include a lender failing to meet financial timelines, unclear house titles or a seller failing to disclose a problem with the property. Any small error can kill a deal. A great real estate agent knows to watch for trouble and can skillfully deal with challenges as they arise.

In conclusion, the road to home ownership can be bumpy and can be filled with unexpected turns and detours, but having a real estate agent’s assistance can help guide the way. They are crucial in the real estate business.

How Do Real Estate Agents Get Paid?

How Do Real Estate Agents Get Paid?

Real estate agents are individuals who are licensed to assist clients when buying, selling, or renting real estate property. Unlike other professionals who get paid by the hours they spend on the job; real estate agents will only get paid once a transaction has successfully closed. The agent is then paid by receiving a commission for their services. The commission is calculated based on a percentage of the selling price from the sold property.

A typical real estate agent fee can be as much as 6%. However, the agent will not receive 100% of this fee. To better understand how real estate agents are paid, it would help to first know about the relationship between a broker and an agent.

The broker runs the real estate office. In the real estate industry, the broker has acquired more skills and experience having underwent more education and intensive training. A broker is legally responsible for all real estate transactions he has done himself and/or by his sales agents. He can work independently or with another broker as an associate broker. A broker can also act as an agent in a real estate transaction. All real estate commissions must be paid directly to the broker. It is the brokers responsibility to split the commission as stated in the Broker/Agent contract and with any other agent involved in the transaction. Usually, the broker and the agent split the commission 50/50 or depending on what was agreed in the Broker/Agent contract.

A sales agent works for and under the broker. An agent cannot work independently and is prohibited to accept payments directly from clients. The agent is the person the clients will personally work with throughout their transaction.
Generally, there will be 2 parties involved in a transaction – the listing agent with the listing brokerage and the buyer’s agent with the buyer’s brokerage. Sometimes, the real estate agent can be both the listing and the buyer’s agent depending on the deal.
How much do real estate agents really get paid? The example below will better illustrate the process.

Mr. Client wants to sell his property, for $280,000.00. He meets a real estate agent named Bob, who works for the WiseBuy Realtor. Mr. Client agrees to pay a 6% commission, of the selling price. Bob and Mr Client sign a listing agreement. Bob lists the property on the MLS and puts a “For Sale” sign up in front of the property. Bob is contacted by Agent Sue who has a client that is looking for a house. Agent Sue takes Mrs. Buyer to Mr. Client’s property and shows her the house. Agent Sue submits an offer, on behalf of Mrs. Buyer, for $275,000.00 that was accepted by Mr. Client.

The agreed 6% commission paid by Mr. Client was split 50/50 between the selling agent’s brokerage and the buying agent’s brokerage. Agent Bob’s brokerage received $8,250.00 and Agent Sue’s brokerage received $8,250.00. Since Bob is on a 50/50 commission split with his brokerage WiseBuy Realtor, his total commission is $4,125.00.

The breakdown of commissions earned by Bob and his broker.

  • Total commission paid by the seller $16,500.00 (Typically, the seller pays the realtor fee unless otherwise negotiated)
  • Total commission paid by the buyer $0.00
  • Bob’s commission $4,1250.00
  • WiseBuy Realtor brokerage commission $4,1250.00