Buying a home might be the biggest financial decision you’ll make in your life. Ever wonder how many professionals are involved in the home buying process? Today, a typical home sale involves more than 10 different people with different skills working together to ensure the transaction goes smoothly.
Of course, you’ll be the star in this show, with a diverse cast of supporting players. While you might not meet all of them face to face, the majority of the players will be working behind the scenes to make the process a success. That said, here are the 7 professionals involved in a real estate transaction who you’ll have to work with.
1. The Seller
The seller is the homeowner who puts up the property for sale.
The home seller owns the property such as a condominium, townhouse, bungalow, or any other type of property listed for sale. The seller doesn’t need to be an individual; it could be a company, financial institution, or even a government agency.
Usually, the seller will employ an agent to market and sell the home on their behalf. At times, the seller may opt to act alone, in which case, the property will be advertised as For Sale by Owner or FSBO (pronounced Fizbo).
2. The Mortgage Lender
A mortgage lender is usually an institution, rather than an individual, who will provide you with the loan you need to purchase your dream home. Examples are banks, savings and credit cooperatives, and mortgage bankers.
Your lender can pre-approve you for a mortgage, and this will help you embark on your house hunting journey with a budget in mind. Besides the time-saving benefits, preapproval for a mortgage assures your agent that you’re serious about buying a home.
3. Real Estate Agent
Real estate agents are key players in the home buying process. In most cases, you’ll work with a real estate agent throughout the entire home buying process. These professionals are licensed to sell homes and have extensive experience in the real estate market.
A typical real estate sale involves two types of agents:
- Buyer’s agent
- Seller’s agent
The buyer’s agent represents the buyer when purchasing a home. He or she will walk with you throughout the entire real estate transaction process—from locating a suitable property to negotiating a fair price to coordinating inspections, all the way to closing the deal.
The seller’s agent, on the other hand, represents the seller. This agent works with the seller, assisting them in marketing the property, negotiating the best terms for the seller, and ensuring the property fetches the highest price possible.
You’ll likely not meet or interact with the seller’s agent, but a home sale won’t be complete without them. At times, a real estate agent can act as a dual agent, that is, work for both the seller and the buyer. In such cases, the agent will represent the interest of both parties.
4. Home Appraiser
A home appraiser is a professional hired by your mortgage lender to evaluate the market value of the subject property.
He/she will give an estimate of the current market value of the property based on many factors including:
- Prices of similar homes that have recently been sold in the neighborhood
- Nature of the surrounding neighborhood
- Possible future developments in the area
- Size and the condition of the home
The appraiser will then summarize a report taking all this information into account and set a price for the property. While the appraiser works for the lender, you pay the appraisal fee as part of the closing costs.
5. Home Inspector
Before you commit to buy that property that checks all the boxes for your dream home, you’ll want to hire a home inspector to check it.
A home inspector will check the house to ensure the building is up to code.
He/she will determine the condition of all structural and mechanical aspects of the home. If the property requires major structural, writing, or repair work, the inspector will advise accordingly.
6. Title Representative
When buying a house, you or your agent will have to deal with a representative from the title company. The role of this agent in the home buying process is to search the home’s title and confirm the title is available and clear to be transferred to the new buyer.
The title company will, among other things, confirm the title is free of any liens and encumbrances that may bar the transfer process. It will also ensure the seller legally owns the property and has the right to sell it, in the event the property was inherited.
7. Insurance Agent
Risk management is vital in such a high-value purchase, which is why you’ll need to partner with a reputable insurance company. Insuring the property will prevent you from being hit with a huge financial burden in the event things don’t go according to plan.
Wrapping Up
When buying property, it’s good to have an idea of whom you’ll be dealing with and what they do, because their interests might differ from your own. Other professionals involved in a real estate transaction include an attorney, surveyors, escrow agents, loan officers, and a finance broker.
We hope you found this blog post Who Is Involved in a Real Estate Transaction? useful. Be sure to check out our post The Real Estate Home Buying Process for more great information!
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