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5 Facts Your Broker Doesn’t Want You To Know

  • Highlights

  • Be smart about how brokers make money

  • You can negotiate brokerage and home prices

  • You can meet the owner yourself

  • Get more affordable options and don’t reveal your budget

Most home buyers depend on the real estate brokers to help them select the best house within a budget. Since you may be looking to do the same, it pays to understand that brokers are protecting their interests too. So, instead of relying on them blindly, plan how you can best communicate with your broker to ensure that you get a good deal.
Before you set up a meeting, take a look at 5 lesser known facts that brokers don’t want you to know.

That your broker’s fee is negotiable

Giving brokerage for your new home is a standard across India. The general trend is a 1% brokerage for properties priced below Rs.50 lakh, and 2% for properties priced higher than Rs.50 lakh. But remember, brokers charge the same percentage as fees from both you and the housing developer or seller. So, negotiating your share doesn’t mean they don’t earn, it simply means that they don’t stand to earn as much. So, try to talk about a fair fee that reduces the pressure on you.

That their advantage lies in sealing the deal at a higher price

Brokers always try to quote a higher price for the deal they are negotiating. After all, a higher value increases the brokerage amount. So, when you hear the price from the broker, be sure that he is quoting a figure that is higher than the seller’s price. Check the on-going market prices for the carpet area you are buying, and then negotiate to bring down the price.

That you can have exclusive interaction with the owner

Brokers are seldom comfortable allowing you and the seller to meet and interact without them present. This is because they don’t want you signing the deal without them and losing out on brokerage. However, you may insist on meeting the seller/s and having a conversation with them. You can sign a contract with your broker about paying his fees if you select the house he or she helped you find to allay such fears. Then, you can meet the seller and discuss important aspects about the property you are buying. This is necessary, because brokers, in their hurry to sell faster, may only tell you what they think will push you to buy.

That you can get better houses within your budget

Be clear about what you want in a home and insist on getting it. Since you are taking a substantial home loan to purchase your home, you deserve to find the right property. In order to sell quickly and easily, brokers may not do the work required to show you all the properties within your budget. Ask them to show you more options, and do not settle for anything unless you are completely sure. Remember that there are numerous brokers, so you can hire more than one to find the right home. Some lenders like Bajaj Finserv, also offer property search services on home loans to further help borrowers like you in the home search process.

Additional Read: Floating Interest Rates Vs. Fixed Interest Rate: What Is a Better Option When You Opt for a Lap?

6 Things to Remember for First Time Home Buyer

That you don’t have to tell him your real budget

Just because you can spend a certain amount on a home, doesn’t mean your broker needs to know that figure. Start on the lower side based on market research to get the best deal. Otherwise, you may end up paying your chosen amount on a home whose value is lower or one that could have been priced lower due to a distress sale or a slump in prices in that particular area.
Staying well-versed with these 5 facts will help you make use of your broker’s services and buy a home that truly works for you.

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