Do we need to use a RE Agent?

No, but you should use one.

We wouldn’t co-buy a home without using a RE agent. There are many reasons behind this. A compelling justification for using an agent is that it’s not a good idea to represent yourself in high-stakes transactions of this nature. This hits at the heart of the principal-agent relationship. Similarly, a licensed attorney would rarely decide to represent themselves in court.

Are Buyer’s Agency Agreements mandatory?

In some states, a real estate agent can’t represent a buyer in a real estate transaction unless the (co-)buyers sign a written Buyer’s Agency Agreement. Not all states mandate this step but it is generally a good idea that clarifies your relationship with an agent and provides you protection.

How many offers does it usually take to reach mutual acceptance?

It depends. Many factors are at play, including luck. If you’re prepared, follow the process we outline in this course, and have rational expectations about home prices in your market, you can reasonably expect to outperform the average buyer in your local housing market.

On average, the CoBuyers we’ve worked with have found a home in roughly half the time and with 50-60% fewer viewings versus all buyers in their respective local housing markets during similar periods.

What if one co-buyer drops out during the home search?

This is actually fairly common for larger groups. Assuming you aren’t yet under contract on a home, the best way to handle this is to repeat phase one (planning & building consensus) and then to refresh your preapproval for a mortgage. Both of these tasks should be manageable in a relatively short time frame if only one person has dropped out and you’ve recently completed them.

How does earnest money work in a co-buying scenario?

Earnest money serves as a shared financial commitment from all co-buyers to the seller, signaling serious intent to purchase the property. Typically, one lump sum is collected from the co-buying group and deposited into an escrow account. This amount is often a percentage of the home's sale price and is agreed upon in the Purchase and Sale Agreement.

Earnest money is usually credited to the co-buyers down payment and/or costs at closing. If the deal falls through due to reasons not covered by contingencies, the co-buyers could collectively lose this money. Therefore, it's crucial for all co-buyers to be aligned on the terms and conditions under which the earnest money can be forfeited or refunded.

How do we manage the logistics of multiple signatures on documents?

It depends on your state. Several states (a minority) require wet signatures, but most states allow electronic signatures. Check with your real estate agent and Loan Officer to verify the requirements in your state.