How To Build Your Homebuying Team

Buying a home can feel like learning a new language if you haven't been through the process before. Having the right team to guide you through mortgage programs, real estate terminology, contracts, and closing can turn a stressful process into a seamless one. 

"For 99% of people, purchasing a home is the most significant investment they will make in their lifetimes," says Derrick Nutall, vice president of Citi Mortgage's community lending team. "You want to get it right the first time and the right team can actually do most of the heavy lifting."

Learn more about the trusted professionals—from real estate agents and housing counselors to mortgage lenders and real estate attorneys—who can help you make informed decisions during the homebuying process.

Who Is on Your Homebuying Team?

There are several key players in the homebuying process. Here are some you should consider working with.

Housing Counselor

Housing counselors are generally geared toward first-time homebuyers to help them navigate the process and understand the responsibilities of home ownership. Certain loan programs or homebuyer assistance programs may require applicants to work with a housing counselor, but anyone can. 

"I'm a staunch advocate of housing counselors," says Nutall. "They lay out a roadmap to begin the process all the way through closing, and help set the proper level of expectation." 

A housing counselor can help you determine if you are mortgage-ready, guiding you through the process of crunching your numbers, checking your credit, and coming up with a game plan. They can also advocate for you. Just be sure to do your due diligence when selecting a housing counselor.

"A red flag is if a housing counselor is charging high fees for information freely available elsewhere," says Shannon Feick, co-owner and co-founder at ASAP Properties, LLC and licensed Ohio real estate agent.

Real Estate Agent

A real estate agent is one of the most important members of your team. "A real estate agent not only knows the local market inside and out, making it easier to find a home that's good value for money, but they also have local connections that can speed up the homebuying process," says Feick. "Without one, homebuyers might overlook great deals or navigate the buying process much slower."

When looking for a real estate professional to work with, the first thing you should know is who's who. 

• Real estate agent: These professionals assist in the homebuying or selling process. The buyer's agent takes prospective homebuyers out to look at homes, while the seller's agent works on behalf of the seller to show the home to potential buyers. Both types of agents get paid commission after the home is sold. 
• Real estate broker: Brokers are real estate agents who are licensed to hire agents to work under them. Homebuyers may never meet the broker, but the broker usually gets a percentage of the fee.
• Realtor: This is a professional designation that means the agent is a member of the National Association of Realtors (NAR). 

"The buyer's agent is the only part of the real estate transaction that truly has the interest of the buyer at heart, 100%," says Nutall. "They will fight for you for the best possible price." 

Real estate agents receive 5% to 6% of the purchase price at closing paid by the seller. The fee is split between the buyer's and seller's agents.

To find a real estate agent, ask for referrals from family and friends, check local groups for recommendations, and look at reviews online. "​​When interviewing a potential real estate agent, it's important to ask about their experience in your desired neighborhoods and how they've navigated challenging real estate deals," says Feick. "Good communication skills, a strong ethical foundation, and positive testimonials from past clients are key qualities to look for."

Once you begin working together, listen to your gut if you don't feel your agent is doing right by you. "​​A good realtor would never engage in steering, where they might push a buyer towards or away from certain neighborhoods based on discriminatory practices," says Feick. "They also ensure full transparency about any issues with the property or locality that could impact the buyer's living experience."

Lender

The lender, also called the loan broker or loan officer, is another key figure on the homebuying team. This person is integral as they assist you with the financing of the home, help you find the best home loan program for your situation, and walk you through what you need to do from pre-approval to underwriting to closing. 

Do your research to find a reputable mortgage lender, ask for referrals, and then speak with potential mortgage professionals to find a good fit. Nutall suggests asking a lot of questions and making sure that you get a response in a timely manner—and if you're not satisfied, keep looking. "If you feel there is something amiss, you are under no obligation to continue with that lender," says Nutall. 

If you're someone who might benefit from an alternative loan program or a government-backed loan, try to choose a loan officer who specializes in those products. 

Appraiser

An appraiser is an important part of the homebuying process, but you don't hire them. "Your lender is usually the one who will select an appraiser for the home," says Feick. The buyer, however, is responsible for paying for the appraisal; it usually costs around $300 to $400.

An appraiser's job is to independently assess the value of the property. They do this by evaluating the condition of the home in person, and by looking at what comparable homes in the neighborhood have recently sold for. If the appraisal comes in below the contract price, it could impact the sale of the home since the lender won't approve a loan for more than the home is worth.

Buyers can appeal an appraisal value if they feel it is way off base. "This has come up in underserved communities," says Nutall. "You can appeal directly to the mortgage lender and they will take up that cause for you."

Home Inspector

It's customary to schedule a home inspection right before you sign the contract to purchase the home. This gives you the chance to make sure that the home is in good shape and allows you to reconsider your offer price or pull back if anything significant is found.

"Home inspectors check the condition of the home and the cost is usually around $300 to $500," says Feick. He recommends finding a home inspector through friend and family recommendations, local professional associations, or by asking your real estate agent. If you receive an incomplete report or the inspector seems unwilling to answer questions, that could be a sign that the home inspector might not be the best.

Escrow/Title Officer

Another person involved in the homebuying process is the escrow/title officer. This person is typically chosen by the seller, however. "Part of the title process is making sure there are no outstanding liens against the policy," explains Nutall.

Real Estate Lawyer

Sometimes called the closing provider or real estate attorney, a real estate lawyer can be an integral team member—and in some states, it's required that you use one. That's the case in Massachusetts, for example, where Liz Barletta, Esq., of Ligris and Associates, practices and specializes in commercial and residential real estate transactions.

"When we're representing the buyer, the role is twofold if the buyer is financing," says Barletta. First, they help negotiate the sales agreement and make sure to add in any provisions needed to protect the client. Second, the lender hires an attorney to do the title search and act as an escrow agent at closing. 

While every law firm varies, many charge flat fees, says Barletta. A flat fee encourages clients to ask as many questions as they need to without worrying about increasing their expenses.

​​Barletta advises ensuring that you get an engagement letter, which outlines that the attorney will advocate for the buyer. "If you are not receiving this letter, that's a red flag. They might be checking the names and dates, but not negotiating for you. An engagement letter acknowledges they are," she says.

Other People You May Need on Your Team

In addition to the professionals involved in the transaction of the home, you might need to rely on others, too. These may include:

• A co-borrower: If you may not be able to qualify for a home mortgage on your own (or even with a partner), one option may be to add a co-borrower. Some people may have a parent co-borrow with them, for example. This is a big commitment and puts their credit and financial status on the line—and their name on the property's title—so be sure that everyone is on board and understands their obligations.
• Mortgage broker: Brokers act as middlemen who do lender research for you to find the best rate. Though this can be a valuable service, it does add an expense, and people have ample tools available to conduct their own research, says Nutall. If you need a specialized home loan, however, hiring a broker might be worthwhile.
• Accountant/financial advisor: If you work with a tax accountant or financial advisor, getting some input into your homebuying aspirations is a great idea. They can discuss how it fits into your short- and long-term financial plan, and any tax implications, and help you assess home affordability.
• Insurance agent: If you have a working relationship with an agent or insurance broker, you can run some numbers to estimate insurance costs for homes you are considering. You can also inquire if you need specialized insurance for floods or earthquakes.

Tips for Finding the Right Team

Your homebuying team should be trustworthy, accessible, and knowledgeable. Here's how to source your team:

• Lean on trusted friends/family. Whether it's to refer a real estate agent, lender, or attorney, or to provide insight about a special homebuyer program you might qualify for, listening to the various perspectives of your loved ones can help you make an educated decision.
• Do some vetting. Go online and read reviews, make sure the home professional is appropriately licensed, and run a check on sites like Better Business Bureau. You can also ask the professional for testimonials or references. 
• Set up an interview. Before you hire any member of your homebuying team, set up a call or meeting to ask questions. Strong communication is the most important attribute to look for, says Barletta, "and in the style that you as a buyer are receptive to," whether that's phone, email, or text. "If someone is not responding to you quickly even before they are hired, once hired, they are not going to be responsive either."

The Bottom Line

Buying a home isn't necessarily a predictable process. There could be delays or challenges along the way, which is why it helps to have a team of professionals in your corner. "One of the reasons you want to develop a team is that someone on your team can hold another team member accountable," says Nutall. 

Having trusted professionals on your side can make all the difference in terms of what the experience will be like for you. Says Barletta: "The right team can turn a just fine transaction into an outstanding one."