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Buyers Agency Agreement's Help you of Hurt you?

By
Real Estate Agent with Coldwell & Banker Busch Real Estate

 

This blog is inspired by Randy Prothero's blog titled A good case for buyers agency agreements. Now I know there are some who insist on having these agreements pre-signed before they take up with any buyers, however if I did that in my market I would have no one to work with.

The buyers of Luzerne County are not someone who can easily be swayed into signing anything much less a contract that will make you the beneficiary of their house purchase commission. 

That is the local mentality and it's the proverbial hard nut to crack. It's like handing someone a prenup, that says trust ME while I look out for ME. Can this be a self inflicting sabotage on your relationship?

I have learned that in my market folks need to be comfortable with their business relationship first before they sign anything. Once you have them comfortable their loyalty is pretty much guaranteed. I said pretty much. Yes there will be those that burn you, but had I held out a contract initially I would not have the successful relationships established.

There are a few things I have done to protect myself from those who are time wasters and Realtor hoppers. In Randy's case his client was lost to an Open House. Getting people to use my sign in sheet is a constant effort and unless they do, they WILL NOT VIEW THE PROPERTY. Believe it or not there have been some folks who have refused to sign in! I have bluntly told them, you are waisting both of our time, and off they went.

When I conduct my open house I have a Sign In Sheet that will ask specifically if you are working with an agent. If they have an agent, I will happily answer all their questions, show them the property, and tell them to HAVE THEIR AGENT CALL ME  period.No other real estate questions are asked on my end, like are you prequalified, did you sign a broker agreement ect...

 I was recently at a Rich Dad Poor Dad seminar, and through out the meeting the speaker would say The Early Bird Catches the Worm....

Web Site owners this means YOU! When I get a response to my web site I WAIST NO TIME. Call the number, e-mail back promptly, do not wait! I could guarantee that they have several other web site owners e-mailed and usually the one who responds first gets the deal.

This is how I know if they are jerking me around, when I ask how soon they would like to start viewing properties and they respond ASAP, I know I'm in the running...

My web site usually takes the worry of are they prequalified off my hands, and they typically have that information out of the way and have the prequalification in order, so I want to jump right in and show properties and build the relationship.

The Consumer Notice  is the first paper they sign and that is with me reasuring them that it is NOT A CONTRACT.... I could tell by the body movements, the facial expressions, the down right soon to loose interest in you, if I persisit with a Buyer's Agency Agreement.

So for my Real Estate practice, I go by my gut instinct and know when to not loose a client. After a few visits in their company, I think it is a comfortable time to bring up the contract and know by now how well the two of us can work together.  

Just my opinion, and experience from Luzerne County

By Diane Velikis The Luzerne County House Hunter

www.luzernecountyhousehunter.com

 

 

 

 

Comments (53)

Jo-Anne Smith
Oakville, ON

Diane,  In my area we are kind of old fashioned, however,  the BAA is mandatory by LAW here. We are not allowed to represent a buyer and have a buyer sign an Agreement of Purchase and Sale without a BAA in place.

I usually get one signed just prior to the offer being done since I don't feel I need, nor want, a piece of paper binding someone to me nor me to them. I work with people on faith and they work with me on faith.
I know my brokers prefer that we get one signed as soon as we meet a buyer and begin to work with them, however to me that is almost like saying 'I don't trust you and in order to trust you, I need you sign this.'   I do trust people, and if I get burned the odd time (which has never  happened ), then I just as soon it happened that way because I do not want to work with someone who does not want to work with me.

thanks for another great post...

Jo 

Oct 05, 2007 06:03 AM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate

Mary, Makes since to have one, however if it costs you a client who needs time (and most of them do) your better off taking the slow approach

Amanda, I never really gave thought to online purchases, you raise a good point!

Jo Thats what I do too! By the time the offer is in place I have the BAA. Thanks for stopping by!

Oct 05, 2007 06:13 AM
"The Lovely Wife" The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

LOL...

If a star hit you and hurt you in the process ...

I thought perhaps a band aid would be needed :)

TLW...ROAR!

Oct 05, 2007 06:25 AM
Randy L. Prothero
eXp Realty - Hollister, MO
Missouri REALTOR, (808) 384-5645
I am adding Buyer's Agency Agreements in my business, but will not use them in all cases.  I agree you have to go with your gut.
Oct 05, 2007 07:46 AM
Tim Hoffmann & Laurie Nadeau Nationwide
Park City, UT

Interesting perspective on Buyer Agency Agreements. My market is a little different, being a resort market, if I don't have a Buyer Agency Agreement signed, I usually won't hear from them again when they leave town. It's always fun to run into someone who you had spent the weekend with showing homes a year earlier telling you about a house they just bought. I find that when I have this agreement signed, my now clients are very loyal to me.

I have learned that to make buyers comfortable with this process, you don't just stick an agreement in front of them and ask them to sign it, you have to detail what you will do for them. On top of the typical agreement, I sign one that I designed that explains previewing homes, negotiating contracts, buyer protection, CMA's, etc.......everything we already do that buyers aren't aware of. The biggest point I make is that they can have all my services and expertise at no cost to them.

Oct 05, 2007 07:50 AM
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate
We have the same situation here. Our buyers get suspicious as soon as they see the agency documents! And ditto on the web site. They've already signed in and/or e-mailed other agents. You have to respond ASAP!
Oct 05, 2007 07:57 AM
Andrew Trevino
ADT Real Estate - Wilkes Barre, PA
Wilkes-Barre Homes For Sale

Diane,

You know I love you, but I have to say that I have had a buyer's agency agreement with every client I have. I guess it's just the way I learned to do things. I might not have them sign it before we get started, but since I give them the consumer notice right away and tell them it's not a contract, I do let them know that I will require them to sign a buyer agency agreement with me. Throughout the course of the day we get to know each other much better and we can determine if the relationship is a good match. By the end of the day, I have a buyer agency agreement signed.

Another note. I always write on the contract that the client can fire me upon written notice. This gives them an out if they're not satisfied and assures them that I will work very hard for them. In the end, I've never been fired and I have extremely loyal clients. Just my two cents worth.

Congrats on the feature, by the way.

Oct 05, 2007 08:02 AM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate

TLW, Thanks again for the honor of chosing me to be the administator for the Spiritual Rain group. I will do my very best!

Randy I think you are right. Go with your gut! You will know the ones who are skiddish...

Tim Very interesting on resort selling. I suppose you need to make a huge impact real fast to get the sale!

Lisa I'm all for warming up the relationship first.

Andrew, That is very INTERESTING! I have found people much more reluctant to sign! I have also been one to go with my gut. I have had people who signed BAA's stop looking for houses because they were not happy! Later they look me up and we search hassle free for a few days before I ask them to sign. Oh well I guess you have that way about you! :)    BTW I didn't know I was featured until you told me LOL

Oct 05, 2007 08:33 AM
Chris Gempeler
Breckenridge Mountain Top Realtors - Breckenridge, CO
Mountain Top Realtors
I compleatly agree.  It is the same way in my market. Good post!
Oct 05, 2007 08:35 AM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate
Chris, Thanks! It's all about keeping your customer comfortable and building that relationship!
Oct 05, 2007 08:40 AM
Christina Bennani-Persechini
Keller Williams Realty Boston North West - Lexington, MA
Realtor - The House For You

I require my buyer's agent to use a Buyer agency contract. The first time out is a freebie but after that they need to sign a contract. I always explain I would not take a listing without a contract and I cannot take out a buyer without one. If for no other reason than that they have read in our contract that:

We are not:

Attorneys

Home inspctors

and so on. There is alot of responsibility attached to being a buyer's agent and I need to make sure I have spelled out clearly what we will and won't do.

Oct 05, 2007 10:43 AM
Alexander Harb
Knights Investing - Mesquite, TX
Dallas, Texas Real Estate Investing

Diane......

Just as many have said...what works for one might not work for another.... central Florida is so spread out that you NEED a Buyers Agreement before you put all those miles on your car.....

It also separates the serious buyers from the wanna be-s.......

=-)

Oct 05, 2007 01:12 PM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate
Alex, I would imagine Florida is full of gazey eyed tourists that make a BAA necessary!
Oct 05, 2007 01:17 PM
Jason Crouch
Austin Texas Homes, LLC - Austin, TX
Broker - Austin Texas Real Estate (512-796-7653)
Diane - First of all, congratulations on getting your first "featured" post!  I agree with your points here - I wrote a post about how to present and use buyer's rep agreements awhile back, but I do not actually use them myself.  Good stuff!
Oct 05, 2007 07:00 PM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate
Jason, Thanks! I was not even aware of it making featured until Adnrew Trevino told me! I have had some local features before but this is a milestone!
Oct 05, 2007 09:17 PM
Daniel Lowery
1st Choice Real Estate - Jefferson City, MO
e-PRO, Broker - Owner

however if I did that in my market I would have no one to work with.

Same here, I have had several buyers who would not sign, the ones who will can not buy a house, example can not get a loan, or just want to look

Oct 05, 2007 11:35 PM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate
Daniel, Oh I have met the over eager also! Good point!
Oct 05, 2007 11:38 PM
Brigita McKelvie, Associate Broker
Cindy Stys Equestrian and Country Properties, Ltd. - Lehigh Valley, PA
The Broker with horse sense and no horsing around
I totally agree with you, Diane!  Before buyers wil sign anything, they need to build trust and a relationship with you.  They need to know who they are working with before trusting them, especially when it comes to signing something.
Oct 06, 2007 02:05 AM
Diane Velikis
Coldwell & Banker Busch Real Estate - Luzerne, PA
Luzerne County Real Estate
Brigita, I know thats how I would feel and I respect my clients and place myself in their shoes. Thanks for commenting on my post!
Oct 06, 2007 02:07 AM
FRANK LL0SA Esq.- Northern Virginia Broker .:. FranklyRealty.com
Northern Virginia Homes - FRANKLY REAL ESTATE Inc - Arlington, VA

52 comments and nobody told you that you have a typo in your title?

 Read this, it will convince your client:

/exclusive-buyer-agency-contracts-dont.html 

Frank 

Oct 06, 2007 05:32 PM