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Maybe this will explain it a little better

By Whitt Piker

Real Estate Agent with Moore & Co. Realtors

May 18, 2009 05:23 AM

What is a buyers agent and should I have one.

The National Association of Realtors defines a buyers agent as the following:

Buyer's representative (also known as a buyer's agent). This type of licensee is hired by prospective buyers to represent them in a real estate transaction. The buyer's rep works in the buyers’ best interest throughout the transaction. The buyers can pay the licensee directly through a negotiated fee, or the buyers’ rep may be paid by the seller or by a commission split with the listing broker.

That’s what it is. Put simply it is an agent that is solely representing the buyer, and just like the definition states the fee for the buyers’ agent can be paid one of two ways. 1. Directly through a negotiated fee as outlined in the buyer agency agreement. 2. Paid by the seller through the split commission with the listing agent.

Now by having a signed buyers agency agreement there are certain benefits and duties that are owed to the client:

Loyalty: The agent must put the clients interest above their own.

It is not the wishes of the agent that prevail but the buyer.

Obedience: The agents must follow the lawful instructions of their client.

“I may be the Real Estate expert, but you are the boss.”

Reasonable skill and care: The agent must negotiate the best deal for the client.
Disclosure: The agent must disclose all of the information to the client.
Cofidentiality: Convrersation between the client and the agent must be kept confidential, even after the transaction is completed.

It is a common misconception that just because a realtor is showing you property that he or she is working for you.

As a result all confusion can be solved by signing a buyer agency agreement.

Some frequently asked questions

Q: How is a buyers agent compensated?

A: Almost always buyers agents are compensated by the seller. Commissions on properties listed in the MLS are generally split between the buyers agent and sellers agent.

Q: Do I need a buyers agent to look at homes that are “For sale by Owner”

A: No, but you should. It is amazing how often buyers think that they are getting a good deal, only to discover when they want to sell that they overpaid. In addition you buyers agent will ask the owner to pay their commission and almost always they agree to.

Q: Don’t buyers agents make more money if they negotiate a lower price?

A: Realtors depend on repeat business. They do not get good repeat business if the buyer does not feel like the Realtor did a good job. The difference in the commission earned is extremely small in comparison to the good will of a client for a job well done.

Q. Would I have a better chance of finding my home if I use several realtors?

A: No. In fact the opposite is true. Every realtor has access to the same base of homes. When you work with more than one realtor

So in summation, having a buyers agency agreement is going to be in your best interest. It will without a doubt be the tool that will represent you the most. It is really becoming a must, in fact there are some states that have made it a requirement before a Realtor can even show you a house that you have one signed. The problem we as Realtors have faced is conveying the importance of these documents, but it will be the utmost importance in your search for a new home.

In reality if you do not have a buyers agency agreement signed you are not represented by anyone and it is limited as to what the agent showing you the house can share with you.

So protect yourself and your family and sign a buyers agency agreement and put that realtor to work for you.

Thanks

Whitt Piker

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