Buying a House Without a Realtor: What to Consider

Buying a house without a Realtor® is possible, but you should proceed with caution. If you’re thinking of going this route, we’ll highlight below a few factors to consider before you tackle a real estate transaction on your own. We also share an overview of how to do it the right way if you decide to take the plunge.

If you’re thinking about buying a home without a real estate agent, there are five factors to consider before you make your decision:

We’ll help guide you through each consideration so you can decide if this is the right path for you.

1. You might not be as knowledgeable about the current market

Since a Realtor — or real estate agent — works in the housing industry, they’re more likely to be aware of current market metrics, including mortgage interest rates and recent sales prices. They’ll also have access to tools like the multiple listing service (MLS), which can help them find available properties for sale and price your home to attract buyers.

If you don’t want to hire a real estate agent, it’s possible to source this information on your own. However, you’ll have to put the effort into doing the research.

What’s the difference between a real estate agent and a Realtor?

Both real estate agents and Realtors are licensed professionals who help people buy and sell real estate. However, Realtors are members of the National Association of Realtors (NAR), a professional organization. As members, they promise to abide by a strict code of ethics.

Not all real estate agents are Realtors, but all Realtors are real estate agents.

2. You’ll have more legwork to do

Real estate agents do a lot of work behind the scenes, in addition to negotiating contracts and showing up on closing day.

For example, during the homebuying process, agents are responsible for scheduling showings and connecting with any necessary third-party professionals (more on that later). While acting as a listing agent for a home seller, they may be responsible for doing conveyance — ordering the necessary certifications and documents needed to transfer property ownership from one party to another.

While you’re welcome to do this work on your own, it’ll likely take quite a bit of time and effort on your part.

3. You’ll have to negotiate on your own

Negotiations can often be the trickiest part of a real estate transaction. After all, you’re not just negotiating the home’s purchase price — you’ll also have to negotiate a few other clauses in the sale agreement, including whether the seller is offering any concessions and what items, if any, will be sold with the home.

Depending on what contingencies are included in the contract, you may also have to negotiate the home inspection and home appraisal. A Realtor can assist with these processes, since they’re often well-versed in negotiation — but if you don’t have one, you’ll have to go through this process alone.

4. You’ll need to learn the paperwork (or find someone to help)

Each state has its own requirements for what needs to be included in a sale agreement packet. For instance, some states require a seller’s property disclosure to be included with the purchase contract, while others require the buyer to submit a financial statement.

If you decide against working with an agent, you’ll be responsible for ensuring all your transaction paperwork meets the state requirements for the home to be considered under contract. Otherwise, you’ll have to hire another professional, like a real estate lawyer, to help.

5. You may miss out on some important third-party connections

Realtors also often have close connections in adjacent industries. For example, if you need the name of a reputable mortgage lender to help you apply for a home loan or a contractor to do some repairs, an agent can likely refer you to the relevant professionals.

If you decide not to hire a real estate agent, you’ll have to do the research and vetting on your own. You can even get started today by comparing lender rate offers on LendingTree below.

Pros and cons of buying without a Realtor

How to buy a house without a Realtor

Here are the basic steps to take if you decide to buy a home without using a Realtor:

1. Set your budget
2. Get preapproved
3. Find the right home
4. Review the seller’s disclosure
5. Make an offer
6. Get an appraisal and inspection
7. Negotiate
8. Close on your new home

Step 1: Set your budget

Mortgage repayment terms typically last 15 to 30 years, so it’s important to determine what you can comfortably afford. All of your monthly debt payments (including your potential mortgage payment) should be less than 43% of your monthly income, according to the Consumer Financial Protection Bureau (CFPB).

 Learn more about what’s included in your monthly mortgage payment.

Step 2: Get preapproved

Most sellers won’t accept a buyer’s offer if they don’t see a mortgage preapproval. A preapproval is an initial green light from a mortgage lender, detailing the estimated loan amount you can borrow. A preapproval is based on a review of your credit, debt and income.

Read more about minimum mortgage requirements to make sure you’re ready to get preapproved.

Step 3: Find the right home

Finding the right house for you is probably the most exciting part of the homebuying process. The U.S. Department of Housing and Urban Development (HUD) provides an example wish list of what to look for in a home that includes things like:

 A specific area of town
 The type of house you want (e.g., ranch, two-story, condo, mobile home, townhome)
 The number of bedrooms and bathrooms
 The overall size of the home and the land it comes with (if any)
 The local school district

Step 4: Review the seller’s disclosures

During the mortgage closing process, sellers usually are required to provide a seller’s disclosure to tell potential buyers of any known problems with the house that would negatively affect its value. Each state has different laws on what this disclosure must include. The only nationally required disclosure is for lead in the common areas of the house, such as lead-based paint.

Some states require a real estate lawyer to be included during closing

There are seven states that require that a real estate attorney to participate in the closing process. However, even in states that don’t require it, one could be a useful guide for the typical mounds of legal and financial paperwork homebuyers have to traverse.

Here are the states that require a real estate lawyer:

1. Connecticut
2. Delaware
3. Georgia
4. Massachusetts
5. New York
6. North Carolina
7. South Carolina

Step 5: Make an offer

If the house is right, here are the things to consider when you’re deciding how much to offer:

→ Asking price
→ Prices of comparable homes in the area
→ How long the property has been on the market
→ Items from the seller’s disclosure and the home’s condition

If the sellers have a real estate agent representing them, you’ll send the offer to the agent. If they don’t, you’ll send the offer directly to the sellers using an offer letter. An offer letter usually needs to contain:

• The home’s full address
• The full, legal names of the potential buyer(s)
• The amount you’re offering for the home and your earnest money deposit amount
• Any proposed provisions, contingencies or seller concessions
• A copy of your mortgage preapproval letter
• State-specific clauses (if required), such as a deed and title discussion
• The date you expect to close and a deadline to respond to your offer

Step 6: Get an appraisal and inspection

Mortgage lenders typically require home appraisals, which provide a professional assessment of a home’s value. Lenders may or may not require a home inspection, which looks closely at the home’s condition, livability and safety. You could use the results from both to help you negotiate the home’s price.

Learn more about mortgage closing costs and how much you could pay.

Step 7: Negotiate

If the appraisal comes in low or the inspection reveals problems, you could ask the seller to cover the difference in value and/or the repair costs. A seller could cover the repairs by:

• Discounting the price
• Agreeing to a reimbursement
• Fixing the issues before you close on the house

Step 8: Close on your new home

Once you’ve reached an agreement with the seller(s), you’ll finalize your mortgage and the home sale. You’ll need to bring any money to cover your down payment and closing costs when you go to sign on the dotted line. Be sure to get copies of any and all paperwork for your records.

Should you buy without a Realtor?

If you’re still unsure about buying a house without a Realtor, here are some signs that you’re making the right choice:

4 signs buying a house without a Realtor makes sense

1. You’ve bought several houses: You may have the knowledge and experience behind you to purchase another home without an agent if you’ve been through the process several times already.
2. You have a committed friend or family member who’s an agent: A close contact who’s willing to help you out for free can be a huge asset.
3. You have experience as an agent: If being a real estate agent was once your job — or is currently your job — and you’re willing to do the work, go ahead!
4. You’re close to the sellers: Buying the home from family or close friends whom you trust could be great if you maintain open and honest communication.

4 signs you may want to hire a Realtor

1. If you’re unfamiliar with the real estate process: If you’re a first-time homebuyer, navigating a real estate transaction can be intimidating. It might make sense to hire a professional who can guide you through this process.
2. If you want more peace of mind: Even if you’ve bought and sold real estate before, having someone knowledgeable in your corner may help put you at ease.
3. If you want access to all the tools: Agents have access to tools like the MLS, which can help you find relevant listings as soon as they hit the market.
4. If you don’t have time to do the extra work: Buying or selling a home without an agent takes time and effort. If you don’t have much room in your schedule, it may be a good idea to hire an agent who can do the legwork.