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Why is it important to explain Buyer Representation Agreement?

By
Real Estate Agent with RE/MAX REAL ESTATE TODAY, Executive Broker 901-488-9590

In real estate world, we are always busy going all directions, got a phone call from my daughter's friend's mom, wanted to look at some houses.  Great!  Went to meet with her and her husband, looked at a couple of houses, found out he has a house listed and sold by another agent, but he did not want to use her anymore in buying another one.  In our initial conversation, he wanted me to put an offer on a foreclosure, I said it would be fine.

We were still looking at houses the next day or so, have not decided which house he wanted to put an offer on.  I suggested them to talk to the lender to run some numbers to make sure, talked about the ones we had seen, and I will get back with them in a day or two.  It went well.

Today, I found out they were talking with another agent also, and that agent knew they were working with me, but she told them she can help them to put whatever offer they wanted to on one property.  So, I called my buyer and explained the situation to him, and wonder why he talked to another agent while they are working with me.  He told me he didn't know by just talking with the other agent will create such a problem.  I apologized to him I didn't explain the agency clear to him up front, I took it for granted, I thought they called me because they already knew me, and wanted me to help them to find their new home.  Also, they worked with another agent before, so I thought they are "experienced". 

Most public do not understand how agency works, they thought they can call whoever on the for sale sign, and look with them, even they are already working with someone else.  As a Realtor, we need to be ethical about buyer's representation either, knowing the prospect is working with another agent, we need to tell the buyer they need to go back to talk to their agent.  Just 2 days ago, a guy called me about one of my listings, and later I found out he already has a Realtor working for him.  His excuse was his agent has a foot injury and I know more about the house than his agent.  And he also said he knows his agent won't care if she finds out, I told him it doesn't matter if she cares or not, it is not the correct way for him to do that.  I told him to call his agent, and let her to call me to get the information to avoid future misunderstanding.

Bottom line here:

  • Don't take it for granted:Just because the buyer already knew you, it doesn't mean they understand they need to commit working with you
  • Do the explain:Always explain how buyer's agent representation works, and why it is so important to both the client and the agent.  It is about commitment, the buyer wants a Realtor who fully works for them, helps them and represents them only.
  • Be honest:If the buyer is not sure if that's the agent for them, just be honest to let the agent know you are shopping for an agent also.  It is up to the agent to follow up with the buyer, if he/she is willing to go that extra mile to provide service.
  • Talking:Communication is the key, let each party knows what's going on, if there is any question, talk it out, make sure everybody understands each other and on the same page.

Back to me, fortunately, we got it cleared and we are committed to each other as buyer/Realtor relationship, we are ready to put an offer on a foreclosure as soon as we get the numbers back from the lender.

 

 

 

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Serving Marion, West Memphis, Crawfordsville, Hughes, Horseshoe Lake, and surrounding areas.  If you are planning to sell or buy, please feel free to give me a call, find out if I am the right agent for you.

 

 

 

Rita Fong, REALTOR®

RE/MAX Real Estate Today

1813 Highway 77  Marion, Ark. 72364

cell:901-488-9590

office:870-735-4663

fax:870-735-4668

http://www.ritafong.remaxarkansas.com

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Comments (9)

Douglas Fischer
East Oahu Realty - Selling Honolulu, Hawaii Condos - Honolulu, HI

Thankyou!  We all need good reasons and examples to consistently feel confident to obtain Buyer Agency Agreements at all times.

Nov 05, 2009 06:59 AM
Rob Thomas
Prestige Homes of The Tri Cities, Inc. CALL....423-341-6954 - Bristol, TN
Bristol TN-VA & Tri Cities Agent, ABR, GRI, e-Pro

Rita......we should all refresh ourselves on agency.....it's hard enough for Realtors to understand it....so you know the public has even a harder time with it.

Thanks again,

Rob

Nov 05, 2009 07:13 AM
Rita Fong
RE/MAX REAL ESTATE TODAY, Executive Broker 901-488-9590 - Marion, AR
Realtor - Marion Arkansas Homes for Sale

Douglas, we just can't take things for granted, even with friends.  Agency relationship is very confusing to buyers.

Rob, it is true.  Public generally have no clue about these behind the scene footage, it is up to us to explain to them, to make it easy for them and ourselves.

Nov 05, 2009 07:37 AM
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Rita, Consumers don't know....also in New York buyer's agents are relatively new and consumers aren't aware of how important they are as well.  You should keep putting the word out on this, it can create a lot of problems.

Nov 06, 2009 01:26 PM
Rita Fong
RE/MAX REAL ESTATE TODAY, Executive Broker 901-488-9590 - Marion, AR
Realtor - Marion Arkansas Homes for Sale

Carole, it is very confusing to public.  To them, they don't know if they keep calling every agent in town to show them different property, it will create problem to everybody. It is an ongoing issue.  

Nov 06, 2009 03:54 PM
Kay Van Kampen
RE/MAX Broker, RE/MAX - Springfield, MO
Realtor®, Springfield Mo Real Estate

It's easy to assume the buyer knows agency law.  It's up to the agents to make sure they understand.  I'm guilty of forgetting to protect myself.  Thanks for the reminder.

Nov 12, 2009 11:44 AM
Rita Fong
RE/MAX REAL ESTATE TODAY, Executive Broker 901-488-9590 - Marion, AR
Realtor - Marion Arkansas Homes for Sale

It is very easy to step in mess like this, it is just better to explain to the client up front than later.  It just helps to avoid some misunderstanding.  Thanks, Kay.

Nov 12, 2009 11:55 AM
1~Judi Barrett
Integrity Real Estate Services 116 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK

I want all of my clients to fully understand everything and anything that they sign, friend or not.. relative or not.  I'm with you.

Dec 03, 2009 08:28 AM
Rita Fong
RE/MAX REAL ESTATE TODAY, Executive Broker 901-488-9590 - Marion, AR
Realtor - Marion Arkansas Homes for Sale

Judi, that's right.  When it comes down to business, honesty is the best policy, let's make sure everybody is clear and understood from the get go.

Dec 03, 2009 08:38 AM