If you’re the DIY type, or you want the chance at saving cash on your home purchase, forgoing a traditional real estate agent may be the way to do it.
Why buy a home without a realtor?
To be clear, buyers don’t pay their realtors directly. Sellers pay a 6% commission (of the home’s total sales price) to their own realtor, half of which ultimately goes to the buyer’s agent.
In theory, a seller — and the agent handling their listing — would be more willing to negotiate on price if they know they’re not handing over $15K in commissions to a buyer’s realtor. That means a better deal, more money in your pocket and possibly more cash to put toward your down payment, closing costs, or even new furniture once you move into the place.
But money aside, there’s also another big benefit to going it alone: only your interests will matter. Because agents get a cut of their home sales, it’s not uncommon for them to steer clients toward bigger, more expensive houses. When you buy a home without a realtor, those outside influences don’t factor in. You and only you choose which homes you look at and how much of your money you’re willing to spend.
How to buy a home without a realtor
It might sound scary to buy a home without a realtor, but don’t fret. Thanks to the web and the millions of digital tools at your disposal (not to mention, a little guidance from Open Listings), it’s a lot easier than you think.
Here’s how you can DIY-ish and be a proud homeowner in no time:
1. Figure out how much house you can afford
First thing’s first: what can you spend on your home? Use a mortgage calculator to hone in on how much you can afford every month. You generally won’t want your housing costs to eat up more than 30% of your income, but there’s more to those costs than just your mortgage.
You should also factor in HOA fees, property taxes, private mortgage insurance, homeowner’s insurance and more. Be sure to factor all of these into your calculations. You may need to do a little research on your ideal location to get a good grasp on these potential costs.
2. Get pre-approved for a mortgage
Next, it’s time to find a mortgage lender and apply for pre-approval (unless you’re paying cash for the home). Look for a lender with good reviews, and don’t be afraid to shop around and interview a few before deciding who to go with. You’re going to be stuck with them for a while, so be thorough!
Once you’ve decided, contact a loan officer to apply for pre-approval. Usually, they’ll just need a few details about your income, debts, and the type of home you’re looking to buy. If all goes well, they’ll “pre-approve” you as a borrower, essentially saying you’re a good candidate for a mortgage loan. They’ll give you an official letter saying you’ve been pre-approved, as well as the total loan amount you’re approved for.
3. Find the perfect house
Use the web to find potential homes that fit your budget and preferences. Zillow, Trulia, Redfin, and, of course, Open Listings are all great places to start. Be sure to set up alerts on these sites so that you’re notified any time a house in your price range gets listed.
When you find a home you’re interested in, attend an open house (if one is scheduled), or schedule a private house tour instantly through our site.
4. Make an offer
If you find a home you like, do a comparative market analysis of the property before making an offer. This is what an agent would do to help you determine the appropriate amount to bid. Look at price, days on market and other details of comparable home sales in the area. Use this data to hone in on the perfect price to offer for the home.
Once you’ve decided what to offer, you’ll want to consult a real estate attorney to draw up the offer on your behalf. They’ll make sure all your legal bases are covered. If the sellers accept your bid, you’ll want to have your attorney draw up the sales contract as well. Both you and the seller will sign it, and you’ll be one step closer to buying that home.
A quick pro tip: If there’s a bidding war or the market in your area is particularly hot, you may want to include a personalized offer letter to the sellers to help your offer stand out.
5. Get an inspection
After the contract is signed, it’s time to get your home inspection done. Look for a well-rated home inspector in your area, and have them perform a full evaluation of your property. They’ll assess its structure, systems, appliances, and more. Then, they’ll give you a report that details their findings.
If anything needs repair, you can ask the seller to complete these before closing or renegotiate the sales prices to make up for the repair costs. If the issues are serious, you can also back out of the deal (as long as your sales contract has an inspection contingency in it). Talk to your real estate attorney if this is something you’re considering doing.
6. Stay in touch with your lender to keep your loan on track
Your lender is going to request documentation of your income, assets, and accounts — and they’ll want to verify your employment. All of these things are vital to your loan approval, so don’t delay. Send over the necessary documents, answer their questions, and address their concerns quickly to keep your closing on time and on track.
7. Close on your home
Now’s the fun part (well, mostly). It’s time to close! At closing, you’ll sign all the paperwork, pay your down payment and closing costs (that’s the not-so-fun part!), and get your keys. Then, it’s time to move.
A better option: Open Listings
If you’re looking for a simpler, more streamlined way to buy a home without a realtor (not to mention a better way to save cash), Open Listings can help. Our solution makes it easy to forgo a traditional real estate agent, get expert advice when you need it, and skip the need to hire a real estate attorney.
Here’s how it works:
- Use our site to browse home listings in your area. We’re currently up and running in Dallas-Fort Worth, Austin, Chicago, throughout most of California including Los Angeles, San Francisco / Bay Area, San Diego, Sacramento, and in the Seattle area of Washington.
- Schedule a tour of any home you like with just the click of a button. We’ll even send out an agent to meet you there if you like.
- Make your offer directly on our platform. Our team will review it and offer recommendations as needed before sending it to the seller.
- Schedule your inspection, negotiate necessary repairs and track your closing progress on your personalized dashboard. Ask us any questions along the way.
- Close on the home, and get 50% of our commission back. If we get $20,000 on the sale, that means $10,000 more in your pockets.
We’ll have knowledgeable agents and real estate experts here to support you through every step — but only when and where you need it. We’ll make pricing recommendations, review your offer and contract, and guide you from start to finish — all for half the price of a traditional real estate agent.
Looking to buy a new home? Use Open Listings to house hunt 24/7, book tours on demand, create offers, and get back an average of $8,500+ when you buy with us.