Agents Hold the Keys to Safer House Buying

Washington Times, August 25, 2006
By M. Anthony Carr

I hate going to the dentist. I've always had good teeth, only one cavity, so why spend all that money -- not to mention the dental insurance -- on a service I've never really needed?

As long as I brush and floss, why do I need someone with a doctor's degree to look over my teeth, clean them and whiten them? I've pulled teeth myself -- when I was just a grade school kid, in fact. So if I can pull teeth at that age, with

just a string and a doorknob, why on Earth do I have to pay a professionally trained tooth-puller now?

As I reminisce on my early tooth-pulling days, I even recall getting paid for pulling my own teeth. That's right ... every morning after pulling my teeth, I had money under my pillow.

Anyone who has received quality dental care sees right through the absurdity of this argument. However, when it comes to real estate agents, everyone wants them to provide their services for discounted prices, even free.

Licensed real estate professionals bring state-mandated training and knowledge to the table for buyers and sellers. In fact, agents have to get as much or more training than it would take for some college degrees before getting a state
license to represent buyers and sellers in a transaction.

By the time a transaction is over, it is full of legally binding documents pulling two parties together to exchange hundreds of thousands of dollars. All this for one transaction. Most people repeat this process only a couple of times in their lives.

Nearly half of the buyers are purchasing for the first time, according to the National Association of Realtors. They only think agents are there to usher them into houses and that's it. And that's because hundreds of thousands of agents
make it look so easy -- like a grade-schooler pulling baby teeth.

Why should you have a real estate agent on your investing team when it comes to building wealth? There's talk on Capitol Hill of how the real estate industry has a "stranglehold" on the business. It makes me want to, not so much defend, as much as bring to the forefront what licensed professionals actually bring to the table for consumers.

You've heard the axiom that "you get what you pay for." That doesn't go wasted on agents. Many sellers would love to get through the transaction themselves without any help from a "middle man" to save the commission.

It sounds like it makes sense: Why pay thousands of dollars to sell a house when you can do it yourself?

It makes me wonder why 88 percent of those each year who try to sell their own homes eventually hire a professional.

First, there is the license regulated by the state. If someone is going to represent someone in the sale or purchase of real estate, they must follow these rules of real estate. They must know various aspects of real estate law, rules and regulations, such as: what rights exist besides land and how they can be traded; how title can be held; and how to ensure clear title to the land. They must know about financing: traditional, nontraditional and owner-held.

They must follow fair housing laws, the federal, state and local limits on the sale and trade of real estate. They must heed state disclosure laws and regulations on the trade of real estate. They have the necessary contracts and forms.

Most sellers and buyers I've talked with, while they might have access to plenty of information from the Internet about sales transactions, do not have a handle on the nuances, pitfalls and inherent legal dangers they can face in the midst of this huge investment.