Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as "Credible."
If you’re preparing to buy a home, you might be looking for a real estate agent to lead you through the purchase process, but it’s possible to do it alone. In fact, 11% of buyers chose to go this route last year, according to the National Association of Realtors.
Buying a home without a real estate agent can save you money and allow you to shop on your own timeline. But you’ll need to weigh this decision carefully.
Here’s what you need to know about buying a home without a real estate agent:
- Should you work with a real estate agent?
- When to consider buying without a real estate agent
- How to buy a house without a real estate agent
Should you work with a real estate agent?
The main appeal of working with a real estate agent is benefitting from their expertise. A home is possibly the biggest purchase you’ll ever make, so there’s a lot on the line. But on the other hand, taking a DIY approach could save you a lot of money. Before you buy a house without a real estate agent, consider the advantages and disadvantages.
Pros of buying a house without a real estate agent
- You’ll save money. The seller is responsible for paying the buyer’s real estate agent, typically around 3% of the listing price. But because the seller doesn’t have to pay that fee when there’s no buyer’s agent, they may be willing to accept a lower offer.
- You’ll have full control over the homebuying process. Real estate agents typically juggle several clients at once, so you might not get a lot of their attention. Going straight to the seller for answers and negotiations removes a step from the process and could save you a lot of time.
- You’ll become a real estate armchair-expert. Homebuyers have plenty of online resources to help them discover homes on the market and understand the negotiating process. Once you successfully close on the home, you’ll have a clear vision of how to buy a home without a real estate agent along with a sense of satisfaction.
Cons of buying a house without a real estate agent
- There’s a steep learning curve. Home sales are complicated, and real estate agents have a lot of experience that helps you through the process. Going without one means you’ll spend more time doing the research yourself.
- You’ll have a tougher time negotiating. You’ll need to spend time coming up with a good offer price and figure out where you can negotiate. If this is a weak spot for you, then you might not save as much as you expected.
- You’ll miss out on some inventory. Real estate agents have access to the multiple listing service (the MLS), so they know which homes are on the market. Without this, you have to rely solely on third-party listings and schedule open houses yourself.
Learn More: Off Market Homes: How to Find Pocket Listings
When to consider buying without a real estate agent
Despite a few drawbacks, buying a house without a real estate agent could make sense in a few scenarios:
- You know the seller. This might simplify the transaction. Just be sure you’re both clear on the price, closing date, and contingencies. Also, discuss whether the seller will leave behind any furniture or fixtures—and get all of these details in writing.
- You’ve taken out a few home loans in the past. At this point, you know the process and what’s involved — so you might feel more comfortable buying a house without an agent.
Read more: Buying a House For Sale By Owner (FSBO)
How to buy a house without a real estate agent
Here are the steps you can expect to take when buying a house without a real estate agent:
- Figure out your budget
- Get pre-approved for a home loan
- Find the right home for you
- Look over your seller disclosures
- Consider working with a real estate lawyer
- Make an offer
- Get an appraisal and hire a home inspector
- Negotiate with the seller
- Finalize your mortgage
- Close on your new home
1. Figure out your budget
As a good rule of thumb, you should limit yourself to houses that cost no more than three to five times your gross household income. So if you and your partner together earn $100,000 per year, then your house should cost no more than $300,000 to $500,000, depending on your debt obligations.
For example, let’s say you take out a $300,000 mortgage with a 20% down payment and a 3% interest rate. Your payment would cost around $1,400 a month. But you might decide to buy a cheaper house — with a lower monthly commitment — if you have a high student loan payment and need more wiggle room in your budget. Once you have a budget in mind, the next step is getting a pre-approval to check whether you can borrow that amount. A mortgage pre-approval is a letter from a lender showing how much a borrower can take out. It helps you shop for homes within your budget and tells sellers you’re serious about your offer. You can generate a pre-approval letter online with Credible and see how much you can afford. Just answer some questions about your income and the home you want to buy. Then, Credible will review your credit and estimate your interest rate and monthly payment so you know your budget.2. Get pre-approved for a home loan
3. Find the right home for you
Next, think about what’s important to you and narrow the home search to a few neighborhoods.
Look at listings online to see what’s on the market and details about the home.
Once you find one you like, contact the seller’s agent — their email address or phone number should be on the listing — and visit it in person.
4. Look over your seller disclosures
It’s important to find out everything you can about the home before making your offer. One document that can help is the seller disclosure, which lists known issues about the home and other information, such as remodeling projects.
The disclosure varies with each state, but some of the items listed might include:
- Structural issues
- Problems with the home’s plumbing, heating, or electrical systems
- Presence of lead paint, radon, or asbestos
- Toxins in the soil
- History of damage from pests such as termites or rodents
- Mold and water damage
Some states require homebuyers to hire a real estate attorney to finalize the transaction. Typically, the mortgage lender will pay for these services and include the price in the closing costs. An attorney can help you generate and review the paperwork needed at the tail end of the homebuying process, so you might benefit from hiring one even when not required. For a single real estate transaction, expect to pay around $500 to $1,500. Come up with a fair price on the home and put the offer in writing. Offers can quickly turn into binding agreements so make sure you have an attorney take a look before making one — or you could be on the hook for some serious cash. Here’s a quick review of what’s involved in making an offer: Although it comes with an upfront cost (typically $280 to $400), hiring a home inspector can help you ensure there are no major problems with the home. The inspector will evaluate the home’s condition, including major systems, the foundation, floors, walls, windows, doors, ceilings, and roof. Afterward, they’ll send you a report complete with notes, photos, and recommendations. Once you read the inspector’s report, you might want to negotiate with the seller for repairs. You can ask the seller to: Getting multiple mortgage quotes gives you the best shot at finding good loan terms and saving on costs. In a Freddie Mac survey, homebuyers saved an average of $3,000 over the life of the loan when they compared at least five lenders. Once you compare several lenders, find a good deal, and apply for the mortgage, it takes about 30 days on average to close the loan. Expect a longer process during high-volume months, though. Credible allows you to easily compare personalized rates from all of our partner lenders without leaving our platform. Simply enter some basic financial information in the table below to see several pre-approved offers. Then, choose the best one for your budget. Now you’re ready to close on the home — but make sure you read through the paperwork carefully before closing day. Also gather a cashier’s check to cover closing costs, a government-issued ID, and proof of homeowners insurance. By law, your lender should send you the closing documents three days before closing. These usually include: On closing day, you and the seller’s agent will walk through the property to verify there’s no new damage, that all the home’s systems and appliances are still working, and that the home is generally clean. Then you’ll head over to the closing location, where you’ll sign for the home.5. Consider working with a real estate lawyer
6. Make an offer
7. Get an appraisal and hire a home inspector
8. Negotiate with the seller
9. Finalize your mortgage
10. Close on your new home
