I am Peter Thompson, My goal is to take the mystery out of the home buying and mortgage process, and help home buyers understand their options.

Once you have a range of what you can qualify to buy, you are ready to start looking for a home. But this can be confusing too. There are so many options out there; the internet, ads in the paper, yard signs, real estate magazines, open houses. How do you go about finding the right house for you? Prices can differ tremendously from town to town, and even neighborhood to neighborhood. You have to decide what type of home you want and what amenities are important to you. You have to learn about the school districts, and see what areas have done best with resale value. You need to sort through all the houses available on the market, and narrow your choices down until you know exactly what kind of house is the perfect house for you. In a way, you need to educate yourself on all these different options so that you can make the right choice. But what’s the best way to go about this?

Realtors: Most people turn to Realtors when they begin their search for a home. A key benefit of working with a Realtor, is that they have full access to the computerized Multiple Listings Service (MLS). This means that your agent can view every property listed in the market, and show you new home listings as they become available. But good Realtors can do much more than just show you properties; they can act as your advocate and guide, steering you away from costly mistakes and helping you make the right decision. A good Realtor provides valuable guidance from your search, through negotiations, inspections and closing. They know the areas they specialize in, and can help you determine trends in a neighborhood’s property values, demographics and the quality of schools. An experienced agent will also have a good feel for a home’s true market value.

A common misconception is that it costs a lot of money to work with a Realtor. The opposite is true. First of all, the Realtor’s commission comes from the seller – the buyer doesn’t pay a thing. One mistake many buyers make, is to try and save money by buying properties that are for sale by owner. Sometimes these can be a deal, but more often the seller is selling by himself in order to get top dollar for the property. It’s easy to overpay if you don’t know the market. A good Realtor will help you avoid mistakes as well as find the home that works best for you. If the home is for sale by owner, they can often negotiate directly with the owner. Their knowledge of property values, and their ability to negotiate, can usually save you money.

Agency: One thing you need to be aware of right from the beginning is who your Realtor is working for. The commission is almost always paid by the seller. If you call off of a sign or ad, you will be dealing with the Listing Agent. The listing agent works for the seller, and her job is to sell the property at the best price and terms for the seller. Listing agents do work with buyers, and they can be quite helpful and informative, but their duty is always to the seller. Unless arrangements are made beforehand, any other agent showing you houses is also considered a subagent for the seller. That means that they too are legally representing the seller’s interest.

This isn’t necessarily a bad thing. If you’re working closely with your agent, you often develop a personal relationship with each other. She knows your needs and what you’re looking for. As you work together she starts to think of you as her client. Also, if she does a good job working with you, you’re likely to refer friends and relatives to her, bringing more income down the road. She has no such relationship with the seller. So on an emotional level, your Realtor is likely to be working in your interest. But legally she is working for the seller.

There is another option. Buyer’s Agency means that the Realtor represents you, not the seller. That means that she will be able to negotiate the transaction for your best interest. The important thing is to discuss your options with your Realtor upfront. This way you know exactly what to expect as you go along.