Home : Blogs : Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc : Broker Bryant's Real Estate Ramblings

Buyers don't suck......do you?

SOLD!! I read a post recently that was bashing Buyers. The author/agent had shown them houses for several days only to have the Buyer end up purchasing a home through another agent. As alway there were many agents in the comment section calling the buyer names. I have never agreed with the "Buyers are Liars" mentality so want to share my thoughts on this.

First I want to say, if something is not going the way you want it to, look at yourself. Try to find out what it is that you are doing that is creating the issue. We can't change others but we can certainly change ourselves. Get it?

It is NOT the consumers responsibility to protect our commissions. They are also not obligated to stay loyal to you just because you showed them a house or two. We are SALES PEOPLE. Your job as a REALTOR® is to sell your services and until you realize that you will always have Buyers who you call "jerks", "liars", "disrespectful", "time wasters" and blah blah blah.

But make no mistake about it, it is NOT the Buyers fault. Why are you working with Buyers before they have agreed in writing to work with you? I just don't get it. I'm a listing Broker and I compete with other REALTORS® all the time. I don't expect a Seller to pay me just because I spent an hour or so of my time "pitching" them on my services. They have to decide to hire me and then we do an agreement in writing. Why should Buyers be any different? Why do REALTORS® try to sell Buyers a house BEFORE they have sold them on their services? It doesn't make any sense at all. It's ass backwards.

As long as REALTORS® continue to work like this the consumer will ALWAYS have the freedom to look at other houses with whomever they choose. They are not loyal because you haven't asked them to be. Buyers just want to buy a house. That's it. They don't care about your gas money, expenses and time. Nor should they. You don't. If you did, you would have a signed agreement guaranteeing your compensation.

Folks, this all may sound harsh and I am sure you have 100 reasons why getting a Buyer's Broker Agreement signed "won't work" or "will scare the Buyer away" or "nobody does that in may area" or a myriad of other excuses of why you can't. Bottom line is, if you can't get a Buyer's Broker Agreement signed you have not done your job. You have not sold the Buyer on your services and your value. You are making the choice to work and HOPE you get paid. And it's your right to do that. Just remember it's also the Buyer's right to look elsewhere and/or purchase through another REALTOR® or builder after YOU have wasted your time. The Buyer did not waste your time. You did. Take responsibility for your actions and quit blaming the consumer for your lack of professionalism. Up your game.

I can assure you, if you make the decision to only work when an agreement is signed, your business will skyrocket. You may have a learning curve and you may lose a few because you are still learning how to sell your services but it will be worth it in the long run.

So, I challenge each and everyone of you, to make a decision today, to be the best REALTOR® you can be. Don't say you can't. Say you will and then figure out how to do it. Remember this....A REALTOR® without a signed agreement, be it a listing or a BBA, is unemployed. And that's a fact.

If you want the consumer to respect your time and what you do, then earn it. Quit calling the consumer names and start selling them.

Now folks, you know if you read my Blog, that I'm not one to tell you to do something without giving some advice to help you do it. So here are a few posts I've written that will help you in getting a BBA signed. Now you have NO excuses.

Everything you need to know about Buyer Broker Agreements.(14 posts).

OK, that's Broker Bryant's ramblings for today. What say you?

Bryant Tutas
Broker/Owner
Tutas Towne Realty, Inc
Licensed Florida Real Estate Broker
http://CentralFloridaShortSales.com

http://ShortSaleSuperStars.com

Are you a Florida REALTOR(R) looking for a change? Check it out.

CENTRAL FLORIDA REALTOR(r) OPPORTUNITIES

Posted by Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc on 09/26/2009 03:01 PM

Comments (119)

buyer broker agreements, educational, opinion

Originally posted at: BrokerBryant.com: Buyers don't suck......do you?

Post is included in group: Real Estate Rookie

119 Comments on Buyers don't suck......do you?

SEP

Reserved for TLW

TLW

I would have to say you are right. Some buyers will look for ways to get the upperhand and knife you in the back but you typically can't do anything about them. Great post.

BB,

I'm mulling this over. I have resisted Buyer Agreements and have rarely been disappointed. Perhaps, just perhaps, you will inspire me to give it a shot.

Just like life.

If you ain't "pleasurin'" a willing partner, they're gonna stray and try to find someone "better" who will. A very satisfied partner stays with what is pleasurin' them.

If an agent isn't satisfying a buyers needs, that buyer will look for an agent who will.

I'm not saying that buyers' expectations are always realistic. They are not. However, part of our job is to show them the market depending on their ability and stated wishes. If the consumer is unreasonable, give them facts.

If an agent fails to focus a consumer on what is possible and find it for them, the agent fails, the buyer looks for someone who will satisfy them

There is an agent out there for every buyer and they will find the agent who "works" for them. For me, there will always be a meeting and a discussion about how best we can work together. It will always result in a buyer agency agreement...whether for an hour, a day, a month or a year...I can be flexible on timeframe but not on my preference to represent. It's the ONLY way I can work for the buyer to my best ability.

And TLW did NOT make herself into the Morton Salt Girl...I know she's obsessed with rain but SALT!?!?! I take that back, it might just be appropriate! ;-)

Larry,

Hopefully, you will motivate all Real Estate Agents to use buyer agreements. We use them for sellers = listing agreements, why shouldn't we use them for buyers?

Unfortunately, disloyalty is everywhere. People cheat on their spouses, etc. Many buyer's will not stay loyal to their real estate agent. Sometimes you are doing the best job for them. If they have a written agreement then the commission is protected.

Jeana Cowie, Broker Associate, Re/Max Real Estate Ltd, Bergen County, NJ

I thought you summed it up perfectly here and then I realized you've got 14 other posts on the topic - yowza! Off to read more....

Liz

BB, how timely. I was perplexed today when a potential buyer met us at our listing, and mentioned a local agent with whom she'd engaged in other purchases (she buys lots of properties). This, after the disclosure that we represent the seller...ONLY. On the way home, we had (my partner and I) a discussion about why it was that this person had worked with someone, was satisfied with the services offered by him, but was out and about working with listing agents (that's how she initially met this person).

I'll admit that there was an occasion in which we were of the belief that a buyer with whom we'd worked had been "taken away" by the listing agent, but the bottom line was: what did WE do wrong here, and how can we make sure that buyers understand our value? Blaming the buyer wasn't on the agenda. Sometimes it's hard to look in the mirror, but it's necessary.

Easier to blame the listing agent, or the buyer, than ourselves.

I give my buyers the option of using a written agreement, which I send them at my first contact with them. Sometimes I get it back by fax before I even talk to them about it. Sometimes they never sign it, but I sell them a house anyway.

It goes back to educating the buyers on how I work, and working with buyers whom I actually want to work with. My buyer's agreement can be canceled with 24 hours' notice--by either party.

Cheers,

Robin

Bryant, Thanks for the straightforward no nonsense pep talk on getting a buyer broker agreement signed.

Bryant,

There are days I wish I were one of the AR Gods, I'd really like to give you a star for this!

Indeed it's not the customer, it's not the client, if they knew real estate and sales they wouldn't need us.

Well put!

Bill

"Don't wish for things to be easier, wish for you to be better" - Jim Rohn

That's about all I got to say about that (in my best Forrest Gump impression)

Ray Higdon
http://www.theforeverwealthclub.com

Yep...you are right. We have no one to blame but ourselves when do not educate the consumer on how we work. I have been a fan of the buyer rep agreement since it was invented and always will be!

BB - Seems I saw something else on this not too long ago. Personally, I always thought the phrase "buyera are liars" started in the mortgage industry and pertained to the people who would tell their lender that they have great credit, plenty of money and won't have any problem qualifying a loan and come to find out that they had sub-prime credit, no reserves and wouldn't qualify for a loan if they were giving them away.

Either way, while I'm not a Realtor showing buyers homes, I have met my fair share of less than truthful buyers. Part of my initial meeting with a prospect is a discussion on what I'm going to find when I pull their credit report and verify the rest of their personal and financial info that they have provided on the mortgage app. Many will be honest with me and tell me exactly what I may find. However, there are those that will LIE and tell me everything is great, when it clearly is NOT!

Could it be that they just don't know? Possibly, but then again, for many of those, they will admit, that they don't know because they have never seen their credit report (yes, there are actually people out there who have never seen their credit report). However, in some instances, there is no way in #%!! that someone drowning in derogatory debt does not know what their financial status is. JMHO

P.S. - is that one of your sons in the pix in the post?

BB- I say everyone is fair game UNTIL someone steps up to the plate and shares how this business works. Buyer agency is around for a reason. Share its reason, sign up the buyer and the problem stated above goes away. Its not rocket science just common sense.

Awesome post! I was previously of the opinion that I'll get it signed down the road, I wasn't comfortable asking up front. I figured if I did a crap job, it wouldn't matter how much paper was there, they'd split, and if I did a great job, they'd stay.

I recently took the ABR and have made a commitment to use the BBA from the Get-Go now. We'll see how that goes! Now to read over your other posts to get tips on selling it. :)

As a lender, I've seen buyers parade their Realtor all over the countryside. But when you are a Realtor and that is your only client I suppose the feeling of busily working is more important than anything else.

Hello BB - Thank you for your thoughts on it. I have worked with a BA and without --- but you bring up some really good points about looking at ourselves and not finding fault with our buyers.

I really love reading your posts - they're always so straightforward and down to earth. Thank you!

You know Bryant I learned this lesson a long time ago from the other side of the fence. I was trying without much assistance from the local Toyota dealer to buy a car... early 90's. I was a single mom and had just got my license and needed a new car. The salesman really just blew me off after giving me a couple brochures. It was late in the day, I had come from coaching my daughter in little league and looked... well lets just say maybe not quite like a professional. I wanted to drive a car and the salesman told me they were closing in 45 minutes and to please just come back another day.

Well I did, in fact the very next day, in my new car. You know the one I drove an hour away to a dealer with a salesman who took time for me. I gave that young man one of my business cards that day I stopped back by and told him that if were ever ready to buy a house I promised I'd take time and care to help him. He stayed in touch and I bought my next two Toyotas from him. He and I both learned a valuable lesson.

SEP

BB,

Great Post - I am sending this to everyone on my team. I am in the process of putting together a package for buyers that will add a lot of value by using the package and the vendors who provide it - starting with a $50 gift certificate from Restaurants.Com

Of course, the program is hinged on the buyers signing an agreement. I have had mixed results in the past - but never really pushed myself. I know that had I had one I would have saved a couple of buyers from straying after an extended period.

My team is resistant (of course) so my job is to build a solid presentation that will guarantee to make it happen - and with what you have shared in your series of articles, I am certain I will learn much and accomplish my goals.

Thanks again for this great post.

John

See, we can agree :-)

Bryant, If agents don't value their time then buyers won't. One of the best phone sales marketers I know said the way 95% of all business is obtained is by asking for it. LOL

PROFOUND - and true for Agents, Stagers, Lenders, Inspectors... ALL of us! Thanks!

Broker Bryant, I have read many of your posts on this and others here.

Do all the folks who continue to blog on AR not do this?

I think after enough "loosing out" they will start to learn...time is money.

We charge an Application fee to even go look at rentals, since showing rental properties takes just as much time. My company uses Transaction Coordinators for Rentals.

Some of my team members didn't like the idea, so I said, "ok, your time...but you will pay the Application fee out of your commission.

The one team member has rented the most listings this year has always requested it. Proof is in the pudding.

To work without a contract, buyer contract is not good. You wouldn't list a home without so contract so why work with Buyers without one.

Hi Missy, I'm sure there are many folks that don't use a BBA, including myself at times. Of course the majority of my buyers are purchasing over the internet. BUT...if we don't use a BBA we certainly shouldn't run around blaming the buyer when they don't stay loyal. I hope you are doing well on this beautiful Sunday morning.

OK...I appreciate and accept the challenge...and thank you for offering it...

You said it. It is the whole reason we have a buyer's agency agreement that they have to sign anyway. Otherwise, you are taking them in your car and burning gas for nothing. My landscaper won't even do work without a deposit or signed contract, why shouldn't we?

I love the fact that you constantly encourage everyone to do the very best job that they can and then you share knowledge with them to them do that.

KUDOS TO YOU!

Yeah Bryant! You tell 'em! I don't EVER work without a Buyer's Rep. Of course, here in TN it's ILLEGAL to do so (but many agents either don't realize it or ignore it). Unfortunately, recently, one of the agents that chose to ignore this was one of the agents in my office (he's pretty new, so it's a lesson learned). We had been working the same people and didn't realize it. I had been speaking with the wife via email. He had been speaking with the husband. He took them out and showed them some properties and then went out of town knowing they were coming back into town over a 3 day weekend. In the meantime, I knew nothing of this and she set up an appointment to meet with me when he was gone. I got a buyer's rep agreement when they came into town. Needless to say the other agent was furious and wanted a referral fee which I refused (I wasn't going to pay 25% of a $1Million + commission for 10 or so hours of work) - especially since they found me through MY website. I agreed to pay him for his time ($150/hour I thought was nice compensation). I'm sure it's caused hard feelings, but I tried to be nice about it by telling him about TN state law and how to get his CUSTOMERS to become CLIENTS by having them sign an agmt. Any other agent in any other office (and perhaps mine) would have told him to pack sand.

Because it's law here in TN, I have a hard time feeling sorry for agents who lose customers because they don't get a buyer's rep. Follow the law and you won't have problems. Besides, if they're ignoring (or don't know about this little real estate law), what OTHER laws are they ignoring or ignorant of?

I agree with your words above BB. I seem to find myself asking my clients to sign an agreement when we are writing up an offer. Primarily because a ton of who I deal with is by referral so I feel confident they aren't going anywhere. I do agree though, I need to be doing this up front.

When I saw the title of this post I was most certainly going to disagree with you.

But after I read how this is about BB agreement, I have to agree with you!!

Buyers are NOT liars. And if there is no lloyalty, then I really believe it's the fault of the agent (mainly for wasting time with anyone who does not agree to be exclusive). The other thing that bothers me areagents who whine that the buyer changes their mind about the size, shape, lay out or location of the home they want. Honestly, it's a learning process and the last 3 homes that my wife and I purchased were not what we started out looking for in the first place...

Using the buyer's agreement upfront helps the buyer feel comfortable that you really are going to work for them!

BB,

If you meet with a buyer and present your services to them as you would a seller and ask them to sign an agreement so you can go to work for them you're going to spend far less time trying to figure out who you should be working with and who you're not.

I've never understood agents running out to houses to meet buyers calling from the front steps. Not to say that I haven't done it, but it's usually to open the door for one of my listings because their agent is out of town.

I was contacted a few weeks ago by a friend, her mom wanted to make an offer on a property, but their agent was "out of town". turns out it was for an reo that needed so much work banks would not lend on it, they were only looking at cash offers, 400k and above. These guys needed a loan so this was not the right property. I few days later the agent resurfaced, "out of town", was a death in the family. This all comes down to relationships, and checking in with your clients. I don't want to point fingers, but If you are an agent with trigger happy buyers, its best to let them know when you are heading out of town. New buyers need to be educated on the process. I tell clients I am your agent, I am happy to show you properties, if you call signs or meet agents they will assume they are your clients, not mine!

I have buyers sign an agreement in the beginning, and normally have no trouble.

I am doing a better job with the initial interview finding out what their expectations are and what I can and will do for them.

While you make a compelling argument, for those who use EBA's (Exclusive Buyer's Agreements), it's not compelling enough for me.

I don't want my clients obligated to use me solely based on a piece of paper. I want them tied to me based on excellent service. Based on the fact that I give them more information, more service than they can get anywhere, or from anyone else.

I explain "agency" carefully, and if they want to view property with someone else, or end up walking into a FSBO without me and buy the property... then, as you point out, that's MY fault, not theirs... and as long as I'm willing to live with that, no EBA is required.

Besides... if for some reason they did end up buying something through another agent/agency... I would not enforce an EBA and go after the commission... I feel it would be very bad PR, and not worthwhile in the long run. So for me, an EBA just doesn't work.

Hey! You were right... i had 100's of reasons not to do it....

Bryant, what a great post! We really need to consider OURSELVES when we look at problems. Yes, sometimes it IS the other party, however, we need to make sure it isn't US first!

Bryant, with no buyer agreement there is no commitment on the part of the buyer and it is not win-win for the agent. It makes perfect sense to me what you are saying...

Right to the point Bryant, I agree with you. . is just to easy to blame someone else for our problems. . but real growth comes from looking hard at your own self.

Buyers are in a hurry like sellers. Ask a buyer who you think bailed on you, that you expected to sell a place to what went wrong. In a nice way, you want to know so you don't make the same mistake. The reason they give, whether you agree with it, or it makes sense is the reason they strayed. If you gave the impression you were too busy, right out straight then they trotted, moused somewhere else where they could get service. One by one you could hate them or learn from them.

BB, I have been using a BBA for a while now. i was very adverse to using it based on my excellent service and my thought that my clients loved me! I had my clients that loved me call and tell me "Johnny, we just bought a new house! thank you so much for you help, we will invite you to our house warming".. that was a long time ago, but lesson learned! Many buyers don't understand what we do and get excited an buy a house. As you stated, thats all they want to do is buy a house. I know explain agency and have them sign. I let them know we both "have a job" todo to help them find a home that is suitable.

An agent said earlier that they don't have them sign an agreement because of his excellent service. Would any agent not obtain a signed listing agreement with a seller because they thought they would use them because of their excellent service? I think not.

BB,

Great post! This is something I'll have to start doing! Have a great day!

Hi Bryant -- I totally agree with you on what you said. I do feel one aspect is missing however. Procuring Cause can trump BBA. Granted, one can sue if the BBA states as such regarding commissions. But, if another agent (#2) is the procuring cause for this buyer under BBA with me (agent #1), I will not be due a commission even if arbitrated via our local board. One would then have to sue in court. Is that what an agent is willing to do? I know that some who do, and say business is business, and they are at the top of the food chain.

Bryant:

Many agents have a fear associated with getting a buyer to sign an agreement. There is some validity to it since the buyer may, in fact, choose to work with someone who does not insist on a signature. You have to decide what is the best policy for your business. However, if you do decide to operate without an agreement, you have to accept the consequences that go along with that decision. The buyer may just walk into someone's open house next weekend and buy without you - after all of your hard work.

Bryant,

I agree 100%. In the Realtor community we also have to recognize it is about adding value to the Buyer. The Buyer is only a Liar when we do not ask the correct questions to truly uncover the Buyer's True Wants and needs. If we want to be treated like a profesional we have to act like a professional. This means knowing our market, knowing our contract, and most importantly knowing how to help our clients achieve thier goals.

Bryant -

What do they say physics - for every action there is an equal and opposite reaction? It's worth applying to what we do and live everyday.

Michael

Great post. I totally agree. Our local Realtors do not agree though. Some companies do not want to accept your contract if you turn it in with a BBA.

Tell it like it really is. A great blog.

Bryant...you are so right on. Glad this post got featured. Hey, TLW...really like the new photo of you...when it rains it pours....this is true in life.

Most buyers who "stray" are looking for either a buyers agent to split their commission with them and/or the listing agent to offer them a deal. I cannot tell you how many have asked me to give them 1.5% to represent them. I tell them I do not operate that way and they should look for another agent. Most seemed incredulous that I did not work with them. They did not appear interested in my services they only wanted cash back after the escrow closed.

You did hit it on the nail head with selling your services.

An example would be buyers I picked up this past year.

They had friends and apparently some family members in real estate. After we met at the first home and I went over with them my observations of the home and what they should look for upfront before making a decision to place an offer turned around to me and said We want to work with you. We do not trust those we know in real estate to actually represent us. You have pointed out things to us that others have not. You have shown you are interested in us finding the right house. Yes we did locate a home and closing next week. NO, they did not ask me to give them part of my commission.

It is about service and about Trust.

I am a choosy Realtor and do the whole BAA thing here. I show buyers my value by educating them and in return they are extremely loyal.

Right now I would be losing buyers left and right if we skipped the "educational" phase. Some of my stories of showing homes, offer writing and escrows are phenomenal and OUT OF THIS WORLD (as they are in Florida I am sure.)

People ask what my buyers think when I tell a specific story. My buyers are prepared because I gave them every possible scenario in the beginning (and told them to leave room for a surprise scenario.) My buyers are NEVER surprised and act accordingly when they are presented with something incredible!

I totally agree with your thoughts. I don't have buyers sign an agreement, but in over six years I have only lost two to other agents. And deep down it was good riddance for me! The other agents ended up wishing they hadn't met the either.

It's all about setting expectations. A good buyer broker agreement spells out the responsibilities of both the buyer and the agent. Having those parameters makes it much easier to keep moving forward to the buyer's goal.

Agent's need to explain the BBA to their client when they have them sign it. Too many buyer's either don't know they have one, or don't really understand what it means.

On the nose, Bryant. If we don't have the backbone to ask for a buyer's business, why would we expect to get it?

I see good arguments for both sides and have gone back and forth about it myself. I think it depends on the client, the agent, and the situation. I do agree that agents have no one to blame but themselves if buyers do something they were not educated enough to avoid, but every bad buyer senario is not preventable by a BBA.

Wow - that was a really good lecture! Spot on!

Point well taken Broker Bryant. I couldn't agree more.

I have to say this is right on. The other thing I woud have to add is that I as a LO have long listened to REALTORS complain and what i see more than anything else is poor salesmanship. This is typically what I hear some agents tell their client in their first encounter.. Have you spoken to a lender yet? If not, you must go to one first! TRANSLATION IN BUYER TALK - You are likely not worthy of my services and until you prove otherwise, be gone. LET'S TRY THIS APPROACH.. Hi Mr. Buyer, I want to ensure you are educated and comfortable with the buying process, due to certain market conditions, we want to ensure that we are well prepared when we enter negotiations. First.. Are there any questions... Blah blah.. This equates in buyer's language - I care about your needs and I work for you.. GET THE POINT? Often too many times I have my REALTOR's client staying with me and firing the agent (Talk about awkward).. Salesmanship, salesmanship, and more salesmanship!!!!!

I'm not a Realtor but I would think the BBA would be especially important when dealing with a first time homebuyer. Then again, if you're doing your job they probably wouldn't want to work with someone else.

Then again, if you're doing your job they probably wouldn't want to work with someone else.

~~~~~~~~~~

ding! ding! ding!.... give that man a kewpie doll!

Bryant, be careful, someone might think you are in business to make money:)

We are specific about what buyers need to do for us to work with them, first and foremost they have to meet with us in the office for a buyer consultation, then we have them sign a BBA and get approved by a lender before they get in our car. Our time is too valuable to show 50 houses to each buyer, we have found that by doing an interview and consultation first, we only show 5 to 7 houses before going under contract

Great post! We have to protect ourselves, not the other way around! Explaining agency takes all of five minutes or less and yet there are those who won't take that time!

Thanks for reminding me of something I need to keep reminding myself. Great post!

Well howdy all!!

Great comments as always.

I do want to point out that a BBA in no way takes the place of building a relationship built on mutual trust anmd respect. If I had a BBA and my buyer went out a bought a house through another agent I doubt if I would persue it. I also wouldn't hold my buyer hostage if they didn't want to work with me anymore.

The resason to use a BBA is to give us the opportunity to sit down and really discuss with the buyers how we work, how we get paid and what we can do for them. By putting this in writing and signing it it reiterates to the buyers how serious we take our job. It's not a document used to strong arm people that don't want to continue working with us. Make sense?

using the document as a springboard to discuss "how we work and what we do for you" is great. (something I already explain in extreme clarity)... how about dropping the part that says "and if you buy a property that pays less than X%, you'll owe me the difference, and if you buy a property through someone else, you may still owe me and my company a commish".

If we're willing to drop that portion (which I have no intention of enforcing anyway) I'd be okay with using the doc as a springboard for a very important conversation.

But using the EBA as a cudgel, to force a client to work with you, or buy though you (something that I now understand you're NOT suggesting) is something i cannot in all good conscience ask my client to sign.

Alan, Why would I drop that part? Having that clause in the BBA allows the Buyer to ask the seller to pay a portion of my commission. Taking that out of the BBA makes no sense at all. I certainly don't have to hold my buyer to it but I definitely want to be able to sell him a FSBO or a property offering a $1 co-broke if that's what he wants. My buyers WANT me to get paid. With a BBA they can ensure that I do.

I have NEVER condoned using a BBA to hold buyer hostage no more than I would use a listing agreement to hold a seller hostage. This is HUGE misconception with must agents and one of the reasons why they don't understand how to use a BBA to the buyer's advantage...not ours.

And remember this post is offering a solution for folks that get pissed when their buyer buys something without using them. Which is in my opinion almost always their agents fault...not the buyers. That doesn't happen to me with or without a BBA.

I agree with pretty much everything you say here and am using it at my staff meeting this week... thanks for helping !!!

When my clients find a FSBO they want to see, I have trained them to contact me. I then contact the FSBO and negotiate a co-op fee. If they refuse to pay a co-op fee, I don't stand in the way of my clients wish to see the home.

I just negotiate my fee with my buyers at that point. But I don't have them prenegotiate in writing a situation that rarely comes up. If they decide that they'd like to "go it alone" and approach the FSBO themselves... then I havent' done a very good job of explaining my value, have I?

But, as you point out, my clients WANT me to help them, and the WANT me to be paid. I don't have to have a "signed piece of paper" to get to that point.

To each his own, I guess.... but as with you, BB, that doesn't (or hasn't) happened to me. I prove my value to my clients each and every day.

I've incorporated buyer broker agreements into my business since they popped up on the scene in the 1980s. Not only do they establish compensation for services, but they create a fiduciary relationship between my client and me.

On a transaction I closed last month, I, by mistake, emailed the buyer broker agreement with the executed contract to the listing agent. She didn't say anything about it until it closed. Then she called me to ask how she could get such a document to use with her own buyers. Apparently, she had never seen a buyer broker agreement before and was astonished to discover it's available from the same place she gets her purchase contracts from. For free. Right there online. LOL.

This is such a good post, I am going to make sure another agent in our office reads this. She just walked out the door with a new client (walk-in) and didn't have it signed. I told her to get them to sign it or don't drive the tires off her new vehicle for MAYBE they will buy from me. This is a pretty sure fire way to know if they are "tire kickers" or serious. Thanks for the great reminder of how important getting the agreement is for us!!

This is such great information, especially for someone who is just getting started. I've thought to myself, and my broker has made it clear, that getting the signed agreement is key! It is my responsibility to "sell" myself so the customers feel comfortable signing the agreement. I was the buyer not so long ago and our agent didn't have us sign anything. . . we were loyal, but if we hadn't been, there would have not been anything binding us to her in any way.

Thanks for sharing such pertinent and interesting information!

I totally agree! Plus, I LOVE buyers - without them, we wouldn't sell a thing.

The NAR has two levels of service: customer level and client level.

Customer level does not place a listing agent or a buyer's agent under any form of fiduciary duty. There is not a legal "agency relationship" established. Period.

There are some agents who DO NOT use a BA agreement because they do not want to perform at the client level or have any liability and/or fiduciaries to the buyer.

I let buyers know, up front, I ONLY work under contract -- it is because when I work with a buyer it's with their best interests at the forefront. And . . . it is in their best interests to HAVE a bona fide agent, under contract, performing at client level, with liability and fiduciary duties! It is NOT in their best interest to have an agent working without anything in writing!

Real estate is LEGAL. It boils down to legal, legal, legal (not just location, location, location). The LAW of "AGENCY" is very much established. But without a BA agreement, I don't represent ANYONE!!

Carla, In Florida we are presumed to be transaction brokers with no fiduciary. Howver I can work under a BBA as a transaction broker. A BBA only creates an agency relationship if it states that it does, You can have a valid BBA without being an agent. No different than taking a listing without becoming an agent.

As a transaction broker I am still representing the buyer. Just not as an agent. I still have limited confidentiality and I can still be held liable for my actions.

I disagree that there is one answer and path for everyone. Approximately 50% of my business if from buyers I meet while listing. I've never asked a buyer to sign a contract. That exact fact has actually become an introduction of my education of the buyer client. I discuss the process, including how listing commissions work, my knowledge set, and what the value of my service will be. They know they are free to walk or go direct, and I know that if I don't perform and advocate, they will likely do just that. Always telling it like it is impotant in this process. If you're a throwback 'salesperson', you are likely to lose buyers. If you are truly an advocate for the buyer, they will know and stick with you through thick and thin. Most buyers know the difference after just a few moments. My .02 from the opposing perspective, and the first time I've felt compelled to post.

-Sean

Very interesting post,Bryant. When people go in to buy a refrigerator at Sears, the salesman who jumps on them first regards them as their customer. Even if you as a customer comes back later, the original person often gets a piece of the commission.

I think is fair to say that many buyers think it is the same with real estate agents and fear getting stuck with a "bad"one who is not helpful. They feel empowered once they realize that agents have no real claim on them.

Once you build a relationship with a client, maybe that's the time to pull out contracts to solidify things.

Hi BB, Our customers will only be as loyal as we ask/convincee them to be ! Whether or not you agree with having a signed agreement you still need the customer to understand the value you bring to the transaction !

BB - a compelling argument, as always.

Jeff

GEEZ . . . I didn't know that BB. Remind me to set up shop in Florida . . . seems to be a "hold harmless" state . . .

Great blog, and you have made some solid points in regard to using a BBA.

With that said, personally, we have never used one and probably never will. Over the years, we have done well with buyers and never tried to corner them or put any sort of pressure on them to purchase only through us. If they can find another agent that will be more effective, then by all means... have at it. Our track record has proven that we don't lose many clients, but if one falls through the cracks and another agent picks them up and services them well... why would we complain? It's our ball to drop.

To be clear, I couldn't care less if other agents use BBA's and I'm sure it works well for some, It's just personally not our style. -Cory

BB - I don't agree with the "Buyers are Liars" mentality either. I think the name callers need to question their business practices.

BB: I like what Lenn said re "pleasurin'" a willing partner." We all know there are a few that will stray no matter how much pleasure we give them ... for a few, the grass always looks greener or the deal looks sweeter.

This discussion is pointless. There always be situations where buyers suck or agents suck or both. The same with lying. The most important thing is to move on quickly with what you are doing instead of whining about what happened.

Educating buyers is pointless? Well OK then.

Hi - I'm just referring to the title of your post in my response - you say "Buyers Don't Suck, Do You?" I think this makes an arbitrary distinction that is incorrect. Human beings have all kinds of traits - there are sucky agents and there are sucky clients . . . it's just about being human - the way you state it indicates that all buyers are fine and dandy and that agents who don't do Buyer Broker Agreements are sucky. Just too simplistic and not really true, in either case.

This kind of reminds me of the agent that holds an open house and thinks everyone that walks throught the door is automatically their client. NOT!!

Did Lenn say what I think she said???? LMBO!!!

Seriously, though, both you, Bryant, and Lenn are absolutely correct. I have not had the misfortune of having a buyer use someone else to purchase a home or even show them anything because I have always spelled out my responsibilities to them and have likewise established the ground rules for their behavior if I am to work for them, and I never walk away without having a signed buyer-brokerage agreement. I'm actually aiming to have several happy buyers who have been "pleasured really, reaaallly good" (again, did Lenn really say that? LMBO!!!!).

We are in a new generation where it is never our fault but the fault of others. If the buyer is a jerk, what does the buyer think of the agent? People are who they are and agents need to deal with it. I love difficult clients as it puts me on edge to make sure that I am dotting my I's and crossing my T's. They typically give the best referrals as most dodge them.

ABR has a great webinar on this very subject. Not as colorful! If you are not ABR certified find someone who is and look in the archives on their wesite to listen to it. Worth your time.

I'll try to be careful since I am on the lending side and not a realtor - and - because I didn't see the original article you are speaking about. Simply put I think I see both sides of the story and think this is a case of each case is different.

What did lenn say?!!! I give them a little rope before I get them to sign. It depends!

This reminds me that I should take more time to educate buyers BEFORE we go and look at properties. You all know how that goes, phone call at 2 pm on Saturday afternoon, "can you show me this house today?" and after a brief conversation and some (questionable?) qualifying it's off to the races ...

Great post!

I would repeat everything, word for word, that the agent in post #59 said except that: (a) it would be plagiarism, and (b) since she is from Gainesville she is probably a Gators fan-- and they just whipped my Wildcats... yet again....

To every word in post #59 I would just add:

(A) As a reminder to have an educational discussion that spells out in crystal clarity what agency is and what the promises and expectations are from both the agent and the client-- and even what the definition of 'procuring cause' is-- the BRA can be a very good 'string around the finger'.

(B) As a legal document, I think it is next to worthless given that I do not personally know anyone who has sued a former client over it. Much less sued and won.

Any agent who is expecting (B) to "protect them" from not adequately doing (A) is barking up the wrong tree.

I am not 100% on either side of this. I think it depends on who the potential client is, etc...

I wouldn't list a property without a listing agreement. I wouldn't tell my buyer we are going to closing without a signed purchase and sale agreement.

I wonder why I wouldn't? Wow, I know! I 100% know I wouldn't be paid for my work.

I just can't walk into a bank and say Billy Jones told me I can take $100 out of his account. So, here I am. Can anyone hear, "Put your hands up slowly and your fingers behind your head". My point is that we need a document,in this case a check, with the name of the person giving us money. Translation-We need a BBA to know who MIGHT bring us money. And that we have the right to take possession of that money.

A BBA may have a end date, but it can end early. Heck, we may be the one's that want to end it early. If the buyer wants to end it early, so be it.

At least you can say that the responsiblities and expections of both parties are clearly explained when you have a BBA signed.

PERIOD.

I would say that I have more respect for myself now that I do this. I never looked at this in a positive light until you beat me enough with your previous posts. I finally got it. Yet, another light bulb moment for.

Do you know how much difference you and Missy make in my business? It's pretty astounding!

I feel it's my responsibility to educate my clients about BBA, about how I get paid and the mutual expectation of both parties that want to get into a business relationship together. it's not about tying someone to a contract. It's a mutual agreement.

Plus, buyers really dont want me to work for the Seller - without the BBA signed anyways. That's such a big thing but so many agents fail to explain. They only go on and on about how we get paid. Buyers could care-less.

BB,,,, Very well stated..Buyer Agreements are so important these days if you want to get paid for your efforts. These are great !

Hi Bryant.... but I remember you mentioning that you hardly if ever work with Buyers??? Like you I am in Florida too so it's transaction broker for me.

I have the transaction broker notice signed at the very least for some buyers. In my experience buyers differ but it's the transaction broker notice at the very least then the BBA or else I do not show other homes to them. There is no guarantee of course but I require some kind of commitment. However I don't group buyers as they differ. In my experience no two are alike.

~ Lana

SEP

BB - It's rare that I don't discuss a broker buyer agreement at the intitial consultation.

It's makes sense to me, just like a listing agreement.

I have a different approach on this. I use Buyers Representation Agreement when it suits the situation. I read the potential client. I make the time-frame flexible. Sometimes, if I am showing a buyer 5 houses in a day, my RA will be for those 5 houses. Sometimes I go a generic one for 30, 60 or 90 days.

I've had clients that I've worked with whom I've never made sign one (until we write the offer, anyway). I sell them on my services, explain the buyers' rep agreement to them, and give them the choice. I am always firm on covering myself on houses I show.

I feel like after my buyers work with me a little and get to know me, they would have no reason to go elsewhere. I also explain how important it is for them, if they value my service to them, to call me first if they find a house on short notice that they want to see "right now," and explain that I get paid on commission so it's very important to me that they contact me and not call the agent on the sign. I also explain that if they are unsatisfied with my services, please let me know and we can part ways.

It hasn't been an issue yet. Someday, maybe it will. I used to insist on an RA at the very first meeting, but at that point the trust level is usually low because of the preconceptions many people have about agents. Now they don't trust me and think I am pushy. Now I use the soft-sell approach. I am not pushy, nor am I a push-over. I project confidence and set expectation levels with a high level of communication.

Of course, there are some clients who are not truthful and will sell you out to save a point, but I haven't had to deal with many of those.

Bryant,

Agree with you totally! The perceived hardest thing to do is to ask for the commitment upfront but in reality it is the easiest. If they so no then you won't lose the most valuable thing we have and that is time. Much better than spending time, money and effort while the whole time wondering about the loyalty of the buyers.

Mike

I am sick of buyer's agents showing up AFTER the fact--after an agent has shown someone a house, they claim they "own" that buyer because they sent them info on the comptuer, because they showed them 3 houses 4 months ago, etc.

Prove it-- get a Buyer's Agency agreement. You are NOT working for a client if you don't have a contract (buyer or seller). Period.

In my office, I have a buyer's agent rule: get a BA or I won't fight for your right to have a commission. Don't whine to me that you showed them houses yesterday and they bought one with another agent today. Just get the damn form signed and then you can tell me you had a business relationship I can fight for.

Many agents are toting potential buyers around and don't even have a pre-qual letter for them, let alone a buyer's agency contract.

Linda Metallo, Re/max Impact, Lockport, Il.

I run into this type of thing all the time working here at RECR. I continually have agents call me saying they cant convert our clients. And, then I call the client and they say things like, "I never talked with (name of agent)!! He never called."....

There is no "magic pill"....If you suck, you suck.

Buyer Agency is mandatory here so it is less of a problem. Still many agents get it signed when preparing an offer, you need to get one signed before you work for them or at least early on. This drastically reduces the buyer's shopping realtors while they work with them. the key is having a value proposition for them and they will gladly sign.

Broker Bryant - excellent post. We started out taking the approach of not wanting to "tie the buyer up" with a buyer/broker agreement. After many tanks of gasoline and days with buyers who weren't serious, we have gained some common sense. If you don't treat yourself as a professional, how can you expect buyers to?

Thank you! You have hit the nail on the head. I am a potential buyer. I have worked with one realtor for several years, and have bought and sold several houses with his assistance. Recently he has been having some personal problems, and I was unable to get in contact with him--we were playing phone tag. At the end of the day, since I really wanted to bid on a particular property, I called the listing agent. She first asked me whether I was working with another realtor, and I told her that I had one I had used in the past, but was not able to get in touch with him, so I had called her to find out about this property that she had listed.

Rather than be polite and sell me on how she would be able to help me, she submitted me to a tirade about how long she had been working to sell this property, how she had had a contract on it which fell through because the buyers "walked at the last minute," and on and on. When I asked about financing, rather than being helpful she asked (in what I considered a somewhat snotty tone) what was my problem. I explained that the brokers I usually do business with indicated that they don't do land loans, and that the large tract of land (26.5 acres) meant that they couldn't provide the financing. They would finance only 1 acre with the house, and I would have to find other financing for the other 25.5 acres. She indicated that she had found a company which would finance the whole deal, and had used them for the previous contract. When I asked if she would share that information with me, she indicated that she wouldn't. She indicated they would do an FHA loan on the property--I asked whether they would do conventional. Again, she was not cooperative.

As it turned out, my realtor was not able to assist me at this time. So, I will be looking for another realtor to help me. But, after my experience in talking with that listing agent, I would not want to do business with her directly--I would look for another agent who is more "friendly" to me and my desire to purchase a property.

This morning I see that the property in question now has a "Contract Pending." All I can assume is that she had written a contract on it, and didn't want another contract to come in. Her broker had told me when I called that she was currently working with a client, working on a contract. That may have been for the property in which I was interested. I can't say for sure.

But, my husband and I keep asking, "Why did she turn us away? Why wasn't she more polite and friendly? We may have brought her a better offer for her listing."

Buyers don't get in the car without a consultation and having them sign a Single Party Broker agreement, whihc is what we have in ou state. FYI, the contract is required before you ever right a contract. it starts when you want to give them advice. It is state law, but it gets violated all the time.

I noticed not one person made comment about my reply! My feelings are not hurt but it kind of makes me wonder what your presentation may be like.. Is it anywhere close to what I said? Well being that I just had another REALTOR fired today (I'M SERIOUS), leaves me with another testimonial about the lack of salesmanship and boy do I hate having this conversation with the referring agent (Your client likes me but thinks you suck). I will get to him (I dread these calls) after this post but really people, how many of you are sitting down and going over with a sincere caring voice, STEP BY STEP of what the requirements and expectations are before sending your client to a Loan Officer and/ or showing them homes? I know we all like to think of ourselves better than the cat's meow but I am seeing too much of this firing stuff going on. There is a pattern to this and if you are incorparating sales scripts that inform and educate your buyers, a BBA would only be a natural progression. The truth is, most do not have the confidence in their sales skills in order to have confidence to present the BBA.

I compare what I am talking about to asking for their credit card before knowing what they want and need. If someone was to treat you that way, would you buy from him/ her or better would you even come close to signing any type of agreement?

Ted- Just so you don't feel slighted :)

We tend to think of ourselves as consultants and not salespeople.

The first thing we do when we meet a potential buyer is to schedule a consultation that takes about an hour. It is an education for the buyer and the agent alike to find out the wants and needs of the buyer and to make sure that the buyer wants to work with us and if we want to work with the buyer.

We ask very probing questions, go three deep and find out why??? Find out their needs and desires and to really make sure we know why. Our consultation comes from curiosity.

At the end of the consultation, we ask them to sign a buyer loyalty agreement that explains what we will do for them and what we expect from them. If they agree, THEN we work on making sure that they get approved for a mortgage if need be.

Our unique value proposition is that we can save them 40 hours of time by taking an hour up front, the result is that we typically only need to show them 5 to 7 houses before they see the one that they want and need. Even in a buyers market, the best houses with the best prices go fast, we only show the homes that meet their exact specifications and the ones that they can afford. Our buyers tend to get the good ones because we don't waste time showing homes that don't meet their needs. We rarely "get fired" by our buyers.

Step one: Buyer consultation and loyalty agreement signed

Step two: Get them in front of the lender

Step three: show them homes

Step four: contract to close!!

Jeff! Thank you for making me feel better! That saved me money in avoiding to have to go see my therapist.. LOL!! I am glad you are doing it. Unfortunately not enough of us are.. In fact this post motivated me to write about it (http://activerain.com/blogsview/1259721/hi-mr-homebuyer-no-i-won-t-help-you-)

Suzsan, That sounds about right!! It's unfortunate that folks can;t just take a few minutes to be polite and helpful. I hope you get this sorted out and find someone that can help you. Thanks for reading.

Ted, I'm not sure why people in pour business have ahard time gtrasping the concept of a BBA. It's not the agreement that's important it's the CONVERSATION with the potential buyer that's important. The BBA is just a tool to help us get there.

Thanks Jeff!!!

TO ALL: Thanks for stopping by and participating in this conversation. I hope it made you think. Whether you use a BBA or not just remember we need to educate potential customer/clients on how we work and how we get paid. They need to know.

Bryant - I would have to agree with you on this issue. However, I would think that if a buyer was satisfied with what you were doing for them, and how you were working with them, they wouldn't stray whether you had a buyer/broker agreement or not. Just sayin'.

If you are only working listings, that is a completely different thing.

SEP

BB: Great tips for newbie agents who are working with buyers. Not sure why anyone would say that buyer's 'suck' . . . but then there are bloggers out there who call people 'idiots', too. I'd say that it is a good idea to think about the big picture, as you suggest when recommending the Buyer's Broker Agreement.

OCT

totally agree. Its up to us to not just sell them on a property but sell them on us as their realtor, and if we don't do that its only our fault.

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?