The Risks of Buying a Home Without a Broker

Real estate brokers are licensed professionals who are able to help during the purchase or sale of a home. During a real estate transaction, the broker you hire can help you complete all of the necessary paperwork, make sure that your funds are placed in an escrow account, and assist you during negotiations. While it’s possible to purchase a home without first hiring a broker to help you, there are several risks that you would need to contend with by choosing this option.

Risks of Purchasing a Home Without a Broker

If you decide to purchase a home without a broker, you’ll be tasked with handling every facet of the transaction on your own. Even though this route allows you to save a considerable sum of money since a broker doesn’t need to be hired, there are several risks that you’ll need to avoid, which include everything from the possibility of overpaying to appraisal issues.

You Could Overpay

When you hire a broker, he or she will be able to help you identify what a reasonable price is for the home you’re interested in. Without a broker by your side, you’ll be required to determine whether or not the price is fair. Homeowners tend to overestimate what the true value of their home is.

If you decide to purchase the home at the listing price, you could be spending more than the home is worth. It’s difficult to verify the value of a home on your own. Hiring a broker or buyer’s agent means that you will have someone by your side who can analyze the market and help you during negotiations.

Inspection Issues Might Arise

There’s always a possibility that inspection issues will arise once you’ve made an offer on a home, which is a time when a broker can be very helpful. Home inspection reports are difficult to understand for anyone who hasn’t worked in the real estate industry for years. A professional inspector will be tasked with listing all potential issues in the home, which means that a single report can contain anywhere from 10-60 areas of concern.

However, not every area of concern holds the same weight. While some issues should be tended to before the sale of the home goes through, others aren’t problems that need to be addressed. Without hiring a broker, you won’t know about the various types of inspections that should be done for the home you’re interested in. For instance, a broker may recommend a radon inspection, mold inspection, and termite inspection. If you don’t perform one or more of these inspection, you could end up buying a home that has tangible problems.

Disclosure Problems

Certain states don’t require sellers to disclose problems with their property before selling it. While a broker may be able to identify these issues before the sale of the property goes through, not hiring a broker means that you could overlook these problems. Even if sellers don’t purposely withhold a disclosure they are legally required to make, you may not know what information to request in this situation.

Appraisal Issues

In the event that you pay too much for a home, you may encounter appraisal issues. Keep in mind that lenders require an appraisal to accurately estimate the true value of a home. If you’re seeking a loan to help you pay for this purchase, your lender will only provide a loan that covers the home’s value.

Let’s say that you’ve made an offer to purchase a home for $220,000. If the appraisal indicates that the value of the home is only $190,000, you need to pay the difference with a down payment to make sure that sale goes through. If you have a real estate broker by your side from the very moment you start searching for a home to invest in, it’s much less likely that you’ll overpay in the first place, which means that appraisal issues shouldn’t arise.


Even though buying a home without the assistance of a broker allows you to save some money, brokers can be highly beneficial throughout every stage of the home-buying process. Whether you have yet to find your dream home or have received a counteroffer from the seller, having a broker represent you in these situations should make the entire transaction much less stressful.