What Can an Agent Do for You?
Provide Expertise. Let's face it, some of us don't want to start from scratch. When it comes to buying our first home, we'd rather save time and headaches by getting an experienced real estate agent or broker to guide us through the process. What are some of the services an experienced agent can provide? Knowledge of the housing market is the most critical asset an agent brings to the table. Will the home and neighborhood provide your family the type of environment you're looking for, with high quality schools, or accessible shopping, and safety and security? Will the property have strong resale value when you're ready to sell? A knowledgeable agent knows exactly what's in your price range and where to find it.

Shorten Your Search. So an agent helps you to find the right home at the right price in the right neighborhood, a valuable service, not to mention the possibility of negotiating your best price, which we'll discuss shortly. Agents also have access to a variety of informational resources that you don't. One is the Multiple Listing Service (MLS), a searchable database of residential properties in your region. Just plug in any feature: number of bedrooms or baths, etc., at a certain price in a particular neighborhood, and the MLS generates all the homes for sale with those features in your price range, perhaps not listed in the real estate section of your newspaper.

How to Find the Right Agent
So you're convinced you need an experienced agent or broker. The next question is, how do you find one? Unfortunately, many first-time homebuyers go about it the wrong way. Instead of interviewing several agents on their own, they stumble across them at random while visiting open houses or brokerage firms. Always looking for new clients, the agent impresses with his or her apparent knowledge of the housing market and neighborhoods. In reality, that agent ought to be focused on selling the open house, not buttonholing you for new business. And it's a haphazard, hit-or-miss method for finding the most qualified and compatible person to advise you in your home search, or possibly represent you in a negotiation. Try this 3-step approach instead:

1 - Ask friends and associates for referrals. Call several, and meet with the brighter prospects to discuss your home search.

2 - Make sure they have the experience, training and support you need. Do they have experience listing homes and assisting buyers in the neighborhoods where you're looking? Ask about your wish list of features you'd like in a new home and neighborhoods you're interested in.

3 - Ask them to describe their total approach to assisting a first-time homebuyer.

Who Has Your Financial Interests at Heart?
Remember that when it comes to negotiating a sales price, the Realtor does NOT represent you or your financial interests, under the traditional definition of "agency." Unless you contract specifically with the agent to represent YOU the buyer as a "buyer-broker," he or she is beholden to the seller--strange but true. Actually, the agent should give you a disclosure form that describes the four types of representation: buyer's broker; seller's broker; dual agent (representing both buyer and seller); or non-agent (representing neither).

Buyer Brokers
Unvarnished Truth. If you do decide to hire an agent as a buyer's broker, you'll enjoy certain advantages from the outset. Unlike the traditional form of agency where the agent cannot tell you which home to buy, how much to offer for it, or criticize its defects, a buyer's broker is free to point out any of those things. Your broker will not be "muzzled" in what he or she can or cannot say about a home listing. You'll get advice to help you discriminate between homes and get the lowest possible price.

Negotiator.
The next major advantage can be a financial one. A buyer broker will represent you at the negotiating table, striving to win you the best possible terms and price. But remember that, in practice, frequently the seller's agent will agree to split the sales commission with the buyer broker, equal to a certain percentage of the final sales price. The larger the price, the larger the fee.

Fee Arrangement.
Make sure your comfortable with the agent's fee. Buyer brokerage fees can be paid either as a flat payment, hourly, or as a percentage of the purchase price. That's how it works in theory. Again, that may not be the reality if your broker gets a cut of the listing agent's sales commission.

Exclusive Representation.
In addition, the agent may ask you to sign an agreement that makes him or her your exclusive agent. That agreement will bind you to using that one agent from that time forward. If you're uncomfortable with the idea of exclusivity, sign a short-term, 30-day agreement that can be renewed if you're happy with the relationship. But you don't have to sign anything. If you do, make sure you've found the right person and that they're willing to work hard for you.

Look Out for Yourself, No One Else Will
Always look out for your own interests--no one can do that for you. Don't agonize over whether to choose a buyer's broker or standard agent. Just remember the differences. The main priority is finding a quality agent to assist you. Lengthy experience and referrals from happy customers are proof positive that you'll be satisfied, too.

What are the warning signs that indicate you should look elsewhere? Beware of excessive pressure to purchase a particular home, or pressure to use financing from a particular lender. Nothing good comes from pressure sales tactics.