The Purpose Of A REALTOR® In The New Build Market

Dated: 08/14/2019

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What is the purpose of a realtor if you are buying a new construction home? Do we need to have a realtor if we are using builder's financing? Katy, Tx

Asked by Anjeliqueellegan, Houston, TX  Sun Dec 6, 2015

ShareFollow QuestionFlagHome Buying in 774491 vote

, Home Buyer, Germantown, MD Thu Dec 10, 2015 Ahhhh, I was a victim of this so let me explain it very carefully...

First, if you have a realtor it costs you nothing. The new home seller pays for it. When you choose a realtor, by LAW, that realtor legally has a fiduciary duty (the highest responsibility) to get you the best deal, the most favorable terms, and look out for your best interests. Realtors are overseen by your State Real Estate Commission, are professionals and are there to advise you for FREE. If you do not have a realtor with you, you are going in blind and are severely at a disadvantage in contracts and negotiating with someone sellers (to include builders). If you intend to hire a realtor, you must do so before walking into the property the first time. Make sure you take that Realtor with you. If the seller or home builder will not recognize your Realtor, go elsewhere.

I highly recommend you hire a professional home inspector immediately after the offer is accepted on any house you buy. Be sure that you have a home inspection contingency written into your offer. Your Realtor will fully explain what it is and why it will protect you. Do not listen to the builder giving you their spiel about "how you don't need a home inspection, that it is a new home and what could go wrong, dont worry etc." There is plenty of that can go wrong ! It is YOUR hard earned money & it is up to you to protect your investment. You have a right to hire a home inspector and you should not skip this most important step. Our new home was plagued with problems and had I hired a inspector just after I signed the contract, he could have started all his inspections at the beginning of the building process. Generally, the home inspector will do at least 3 inspections while the home is being under construction:

1) the first inspection is after the framing is complete

2) the next is the pre drywall inspection which inspects the wiring, plumbing, HVAC and all other exposed work before it is closed up in the wall. once it is closed up, obviously you cannot inspect it -That's why you want to hire your home inspector early in this process.

3) The last is the home inspection before you go to closing.

I do not recommend closing until after the builder corrects any major problems If there are any. I don't care what they say they can jump up and down like Rumpelstiltskin and threaten all they want. If you have a significant problem, the builder may never repair it if you do not insist on them fixing it before closing. If you have a major disagreement, seek the advice of your closing attorney immediately.

Regarding Home Inspection -

Make sure you use a home inspector who is licensed, bonded, insured and a member of American Soceity of Home Inspectors (ASHI). ASHI has a website . You can look up information there how to find a home inspector in your area& & learn more about the home inspection process.

*** Do not under any circumstances use a home inspector recommended by the builder!

Regarding Your Closing -

A very important issue about your closing and choice of closing companies: I will give you some advice about another bad issue with new home builders. You should know that new home builders use regular people "trained" to do closings that are not attorneys! THERE IS A DIFFERENCE!

* When you choose your own attorney to do the closing, that attorney has a legal and fiduciary duty to protect you & advise you.

* When you let a home builder talk you into using one of their "closing companies" you should know that these closing companies have no duty to you whatsoever. This is a big problem because They have no duty to disclose something to you which may be a potential problem. Their duty is to the "sale". Yes, I know many home builders offer you big incentives like thousands of dollars $$$ off your home or in free upgrades in order to use their closing company. There is a reason for this! you are trading free stuff for you not using a closing ATTORNEY of YOUR choice. That is what this amounts to. In my opinion, this should be illegal

I wish I could take credit for this, but it is actually from a question and answer forum. Learn from this person's experience- James Moody, Real Estate Consultant

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