Tuesday, November 2, 2021 / by Karri Bedor
Why Should I Sign a Buyer’s Agency Agreement?
So...let’s talk about a Buyer’s Agency Agreement. I have no doubt that there are buyers who don’t even know there is such a thing, and that is perfectly understandable.
Let me explain…
In a real estate transaction, there are clearly two sides: the buyer side and the seller side. What many people don’t understand is that if you are a buyer and did not sign a Buyer’s Agency Agreement, the agent you are working with is on the seller’s side. Yes, you read that right, the seller’s side. In other words, if you choose not to have buyer’s agency, the realtor you’re working with will be representing the seller. Their commitment will not be getting the buyer the home they want at the lowest cost with any sort of negotiating assistance regarding a fair price, but rather getting the seller the best price. Unless the agent is working under a Buyer’s Agency Agreement, the agent’s fiduciary duty is working for the selling side.
Here’s one example. If you don’t have buyer’s agency, an agent can, and should, give you comparable home prices to help determine a good price to offer. However, that’s about as far as they can go in assisting you on what you might offer on the home. With buyer’s agency, the realtor can, and should, give the buyer comparables, but can also advise the buyer in negotiating, disclose information to help the buyer make an offer, and assist in negotiating counter offers if they occur.
What is involved in the Buyer’s Agency Agreement contract?
In a nutshell, the contract itself is a seven page document that explains the terms of the agreement. The main terms include the price range, compensation-which in my case is whatever the MLS offers and costs my buyers nothing, the duties owed to the buyer, and choice of representation.
All of this should be explained by the agent, so any questions can be answered before signing.
For me personally, I like to have buyer’s agency so I can work for my buyer, disclose more information as well as negotiate with their best interest at hand. I also like my buyers to know that I am their agent and that we will be working together as they look at houses, and I will be their contact person who arranges showings on all homes they would like to see. It’s also important the buyer knows that if they go to an open house, they should tell the agent hosting it that they have buyer’s agency so the agent is aware they already have representation.
If you would like more information on the Buyer’s Agency Agreement or would like to see the contract, reach out to me. I’d be honored to discuss this in more detail and see if I may be a good fit for you once you decide to start looking for your next home.
Always feel free to reach out: