Jason,

Talk about Karma.....I just got home about 15 minutes ago (around 10pm). I was with a client, and we were discussing the value of a Buyers Agreement, although he is a Seller.  It was an interesting conversation.  I totally agree that if someone doesn't want to sign it, so be it.

This current client had come to me as a potential Buyer about a year ago.  He wanted commercial Real Estate, and I told him I wasn't comfortable representing this type of transaction, but my partner was.  We met him, and she started right off with trying to get him to sign a Buyers Agreement.....of course he balked.......

My Partner left the meeting saying she wasn't going to waste her time.  Me, I helped him throughout the year with information, advice, etc.  And today I am listing his home for sale, and will help him buy another, plus he still wants a good commercial deal.  I don't need the agreement with him because our agreement is built on Trust and Respect........:) :)

Good timing for your post.....enjoyed it.

Kathy - You handled things perfectly, and you are reaping the benefits now.  Well done!  You and I really do work very much the same. 

Jason,

I said it before...it sure seems like we work similar.....but can you send some of your great listings over here.......not the listing just the house :)

I wish I could.  Keep us in mind if you have any investors looking in other areas.  We have quite a number of California clients who buy investment property in Austin and the surrounding suburbs.

Jason I'm with you.  I have never asked for a Buyers Agency Agreement except once.  That was for a lead I'd received and the buyer said he was working with another agent but wanted me to get the measurements of the bedrooms of a listing.  I told him it would be unethical for me to get him that info since he was working with another agent and that if it happened that he wasn't and would be willing to sign, I'd be happy to help him.  I never heard from him again and that's ok.  I don't want to waste my time with a client who is clearly shopping Realtors.  Great Post!

Hey Sandy - Thanks so much for your terrific comments.  You handled that one perfectly, in my opinion.  You managed to save one of your most important resources - time!  Take a look at some of my other posts and let me know what you think.  I appreciate you reading my stuff.

Your' welcome.  I will check them out! 

Sandy - Thanks!  I look forward to hearing your opinion, especially since you seem to be a good agent.

Thanks Jason that's very kind of you!

Sandy - Well, I am basing it on the fact that you appeared to use sound judgement in your dealings.  This is actually harder to find that you might think, even among experienced agents (which is a sad commentary, I suppose).  Anyway, let me know what you think by commenting on the other posts if you have a chance.  Thanks!

Jason - I've thought about using them before, but buyer agency is not very popular here.  I am planning on pursuing one of the buyer designations to see how they handle it.  I'm not opposed to working without one, as it's the only thing that I've done so far.  However, if I do decide to start using it, you'll be the first person that I contact.  Thanks for the advice.

Jason- I don't use the buyer agreement, but sometimes I feel like I should.  I have a pretty good sense of the people I work with.  A client relationship is built on trust- but sometimes it takes time to develop.  Your low pressure system sounds great!

While I like to think most people are honest/good. I see it all of the time. People ask me if they can drop their agent and go to the builder alone. Or make offer on FSBO alone. Usually this is after months of looking.... like dropping the realtor will make them better clients. pfftt.... Some people are just hard to work with

Jason, I am curious about what your agency status is with the buyers you choose to work with. In Michigan, there are two kinds of buyer agency--one good, another one a lawsuit. Seriously: We either sign a buyer agency contract of some sort, or we later get declared to have been implicitly representing the buyer as agent by virtue of our actions, despite having signed (usually) as a seller's agent (subagent to the listing broker).

David's question occurred to me, as well, Jason, since as Texas law has been explained to me in my classes (both original and legal updates) and by my broker and, indeed, in the form itself, if we don't have a signed buyer's rep agreement, we're representing the seller (all sellers), not the buyer.  Do you have your agents explain this above and beyond presenting the Information About Brokerage Services Form (as in, "Don't tell me anything you don't want the seller to know, because until we have a buyer's rep agreement signed, I am legally obligated to represent the interests of the seller")?  And do you have the buyers sign a copy for the file? 

I'll happily work (for a short while) with buyers without a Buyers Rep Agreement, but (perhaps it's my background as a legal assistant) I want to make very sure that they know up front from the very beginning who represents who when, so they get a copy of the Information About Brokerage Services form to keep and sign one acknowledging receipt for my files, as well as a copy of the Buyers Rep Agreement to review.  And we discuss at the time they get it what it means, so that there's no confusion about who I'm representing while assisting them or who my fiduciary responsibility is to.

I'm amazed, by the way, at how many buyers (and sellers) who've interviewed several agents before they come to our offices are completely unaware of the information we're required by law to provide to them about agency in Texas.  Scary, that. 

Jason:  I just got burned really bad on not using a Buyer's Agency Agreement with a potential client.  It's always been so awkward to bring it up and I do want to give the buyer a fair chance at getting to know me and vice versa.  I made up my mind after this last experience that I will be discussing BAAs from here on out and now you have given me a better way to lead into it.  I've had my fill of tire kickers and playing taxi driver this year.  As another agent in my office said, I am a RealTOR not a real tour!  Thank you for the help.

Tricia, I'm amazed too... no I'm not, I used to be amazed... by buyers who have actually made home viewing trips with several brokers (either several viewings or just one by calling the listing agent) and have never had agency disclosure from the agents. 

David, I've had them be hesitant to sign the Information About Brokerage Services form until I explain (and point out the wording just above the signature line) that it obligates them to N.O.T.H.I.N.G., it just assures my broker that I'm following Texas law by providing the information that the law requires every agent to provide on first meeting, and that they should be getting one of these, or at least the information, from every agent that they work with.   Then, they'll happily sign. 

ADAM - Thanks for your comments.  I can only speak of my experiences and what works for us here, but I am always happy to help!

GINGER - The low-pressure method has worked very well for me and for my agents, as people are much quicker to relax and begin to build trust if I am not shoving documents under their nose for them to sign as soon as we meet.  Thanks for your comments, as always!

TOM - This is true, and there are certainly people out there who will drop a Realtor like a hot potato if they can get a better deal somehow.  I have been blessed to work with many, many loyal clients over the years, but my business partner has a saying that I always remember, "People will do what is to their advantage."  That pretty much sums it up.  I guess I have been able to develop rapport very quickly with my buyers, so it has been several years since I got burned by one.  However, the buyer's rep agreements are not really ironclad, so they probably could have done it even if I had one signed.  As you probably know, Texas has "procuring cause" rules that indicate that the agent who begins the negotiation process is the one who is owed a commission.  Anything else is debatable.

DAVID - First of all, thanks very much for your well-written comments.  Obviously, I am only licensed in Texas, so I can't speak for other states, but it sounds like things do differ here.  Basically, there is an "implied" buyer's agency relationship if someone is showing property, counseling buyers, running searches, writing offers, etc.  I suppose an agent could try to "trick" a buyer by working as a subagent, but I have not seen a true subagency deal ever, and I got my license in January 1997. 

In fact, there is a place on our offers that indicates whom the agent is working for, and I have never checked anything other than "Buyer Only as Buyer's Agent" when working with a buyer.  Clearly, this would be different if there were an intermediary situation, but that is a whole other ballgame.

So basically, if someone wants me to act as their agent, we can enter into an oral contract to do so, at least here.  No documentation is required to establish this relationship, but if they choose to make it more formal, we can do that, too. 

Glad you liked the presentation idea, and I hope it is something you can use.

TRICIA - Thanks for stopping by to take a quick read.  I think that this is a very common misunderstanding among brokers and agents alike.  Despite what you may have heard, it is not a requirement to have a signed agreement, although it is a requirement to present and have them sign (or at least initial) the Information about Brokerage Services form.  I usually circle the section that says, "If the Broker is Representing the Buyer" and explain that this will be the case for our situation.  Here is a link that is pretty informative:

http://recenter.tamu.edu/TGrande/vol12-2/1727.html - it says that only 34.6% of agents are requiring this type of form, but it also says that 61.9% of consumers claim that they signed one (although this could be the IBS form for some of them)

If you are attempting to collect a commission from a builder, then this form would be a probable requirement to prove your pre-existing relationship.  If you are doing the same with a resale home, the form will not really help that much, unless you willing to sue the buyers for the money.  Good luck with that! :)  Basically, buyers can choose whom they want to represent them on a purchase, and the paperwork would only help if you want to go after them later.

I reviewed the Texas Real Estate License Act again, just to make sure.  It discusses the IBS language, but there is nothing there about requiring an agreement in order to represent them as a buyer's agent.  I found this in § 1101.557. ACTING AS AGENT;  REGULATION OF CERTAIN TRANSACTIONS, and in § 1101.558. REPRESENTATION DISCLOSURE. 

Now that I've said that, I am sure that there are plenty of companies that do require this information in order to move forward, but it is my opinion that you will usually end up losing more business by forcing the issue than by not having anything in writing (but it's just an opinion).

I am going to subscribe to your blog today, Tricia.  You make me think when you write.

DONNA - I, too, have been burned plenty of times, but not for the past few years.  However, I also have the luxury of choosing whom to work with now, and a lot of what I do in my personal sales comes from referrals and past clients.  I hope that this post helps when you present the form from now on.  It has never failed my agents, to the best of my knowledge.

DAVID and TRICIA - Thanks for discussing this here.  Good information for everyone, and I completely agree.  It is scary to see how many agents don't do the basics.

In WA the law is pretty simple.  "A seller's agent forms an agency relationship with his or her client when a listing agreement is signed.  A buyer's agent enters into an agency relationship as soon as he or she performs any real estate brokerage services for a buyer, unless there is a written agreement to the contrary."   "A dual agency arrangement is unlawful without the written consent of both parties".  (Quoted from the Washington Real Estate Fundamentals, Chapter 17 WA RE License Law).  So I essentially represent neither side until I perform a specific duty.  I have done two dual agency transactions and they went VERY smoothly because everyone knew up front the situation.

SANDY - That is basically the case here as well.  Thanks for the quote and for sharing your thoughts.  We are currently handling an intermediary transaction that is going very well also, and it is set to close in about two weeks.

Congrats!  I think if clients are informed up front they are open to a dual agency relationship, IF they trust you.  Hey did you check out my Beautiful Bothell, WA blog?  What did you think?

Looks like you hit on a hot topic. Very good post. Hope no lawyers in Texas were reading this. HAAAA

silverthorn: a ranch in West Texas

SANDY - I have looked at a few of your posts and left a couple of comments.  Nicely done!

ALAN - Yes, it does appear to have stimulated some interesting debate and comments.  Thanks for dropping by!

Jason, I love your style and I agree whole heartdly! You make some very valid points. People don't like being bulldozed into anything. Your timing is perfect!

Thanks, Jason, for the cite.  I'm going to have to go read up on it again - all of my instructors have said otherwise,  by them, but I prefer to go by the statutes whenever possible.  Fortunately, I can actually read legalese and have some familiarity with the concept of logic doesn't always apply when you're talking about the law (or the law has its own logic, rather), which is a big help! 

DIANE - Thanks for your complimentary comments!  I appreciate them very much.  Every time someone says something like that, I get energized and motivated to keep on writing.  Also, thanks for adding me as one of your associations!  Take care and God bless -

TRICIA - You are certainly welcome.  I appreciate your comments, as always.  We should meet for lunch sometime, since you are so close.  I can make it to Georgetown in about 15 minutes typically.

Jason, I have never yet used a buyer agreement and have been not really needed one.  With that being said, our market is changing dramatically here in Orlando and I'm finding that it is taking more and more time for some buyers to make a purchase decision.  Due to the added time investments, I'm seriously contemplating the use of an agreement and I was looking for a great way to position it with buyers...and you gave us all just that.  Thanks!

CHRISTOPHER - Thanka for your comments.  I am glad that you found this valuable.  You might consider subscribing to my blog, as I have some more tips there and I intend to keep sharing more of them.  I appreciate you taking time to read this post. 

Jason:

 Michele read your 135000 referral blog today and got a laugh out of it. Have a great day. Today you should get a lead and share a lead with your McMuggin friend. Ha

candlenut: A type of nut that taste waxy

Alan - I am glad that Michele liked it.  Remember to speak with Sandra Bullock about these great opportunities when you see her again.  If you seriously need leads, let me know.  Talk to you later -

Greetings fellow rain addict

Did you join the other Addicts group?

Jason- Thank you for telling me about this post. It is a good post about buyers agreements. Like I said in my comment on your last post I do not use a buyers agreement for buyers of residential properties. We do however deal with large land parcels and developers like Centex and Lenar. So we have those big boys sign confidentiality agreements with commission agreements. OF course these are legal documents our attorney drafted for us to use in these situations. This is because these land deals tend to take 2 to 5 years to close and if someone in the party dies then how do we know the heirs will pay us. Of course this is completely different than finding someone a home to buy! Katerina

KATERINA - Thanks for taking some extra time to read this post.  I just thought you and I agreed on this topic.  I would also use some type of agreement in the scenario(s) you described.  Have a great night!

Jason-  Although we have very different requirements for representation and disclosures, I still practice my business on the same type of premise that you seem to.  I always let the buyer know the differences in selling agent vs buying agent, and let them make an informed decision as to what capacity they would like me to work with them.  Here, we must have a buyer agency contract in place to act as a buyer's agent.   In my particular market, there are only a small handful of agents, myself being one, that will even represent a buyer client.  Our company even provides a very easy to read check list that itemizes what a buyer's agent vs a selling agent can do for the buyer, and some still choose not to have representation!  If they are not interested in signing the buyer agency agreement, I still will continue to work with them as long as I feel that there is a loyalty there and they get a preapproval.  There definitely are times when the buyers will bounce to another agent or pursue a FSBO, but it is normally quite soon after our meeting, and I normally don't have a lot of time or gas spent.  I think that most people will be loyal to an agent as long as they feel that they are receiving quality service.  Of course, as you mentioned, there are always those that aren't loyal!  Thank you again for another great post!