Hi Evelyn,

What you said here:

"I still don't want a Buyer tied to me because of a piece of paper."

With some sort of release clause in place, neither buyer nor agent/broker will be stuck if the association is not good. I have found that it is important to determine personalities upfront via the buyer counseling session. If personalities do not click during the counseling session, then it should be very obvious that the buyer may be better off working with someone else. At this point, wish them well, and let it go.

I will not work without an exclusive buyer agency agreement, because I need to know that my time will not be wasted. I approach my business as a loyal advocate, a valuable consultant, and a trusted advisor. The only time I will consider a non-exclusive buyer agency agreement is with an experienced real estate investor, who has many years of experience. Either way, there is some form of an agreement in place before I start working.

There are still many buyers out there who will equate real estate agents and brokers to car salesmen, and while there is nothing wrong with a career in sales, this is not an accurate perception of our profession. There is so much more to being a good real estate agent or broker. A good real estate agent or broker is a professional who knows how to study the market, synthesize market information to compile valuable reports, and understand how to use this information to benefit their clients. A professional agent or broker needs to understand what their client's goals are, they need to take the time to become familiar with each clients' unique situation, and they need to use their experience and knowledge to assist clients in assembling the research needed to help them create an effective plan--a plan that reflects their unique situation, including the negotiating strategy. It takes an investment of time and energy to accomplish this, and it requires a comittment from both buyer and agent/broker. If a buyer is going from agent to agent without a buyer agency agreement, then how can an agent or broker invest the necessary time and energy to do their job effectively? 

It is true that there are many buyer's who will not sign a buyer agency agreement, but I know for a fact that there are many buyers who will, and I recognize the value of my services enough to reserve them for those who will. There's an old saying, "If you can't respect yourself, then no one else will." This surely applies to the way that real estate professionals work with consumers in the industry. Would a listing agent work without an exclusive listing agreement? Most will not, and for good reason. The same theory applies to buyer agency agreements. Just make sure that there is a release clause, and no one will be stuck, unless there is a property already under contract.

Kathleen, I know what you mean, but you are right. We really need to spell everything out, or else we risk leaving things up to chance. It helps to provide a general overview of each clause, without interpreting the language, so that it establishes familiarity with the buyer.

However, buyers need to review the agreement with their attorney, so that they can receive legal interpretation, as well as have the opportunity to add or subtract provisions if necessary. This is actually very good for buyers, because it enables them to engage the process of negotiating the agreement. Many buyers are unaware that they can do this, and so they are scared off by agreements. If they know they have some say, this tension can change to flexibility if they feel comfortable. 

The tone is not, "here is the agreement, sign it."  Rather, the tone changes to "Here is our standard agreement. Please review it with your attorney, and if there are any concerns, let's negotiate until the terms are mutually acceptable." In my honest opinion, this sounds less intimidating and it conveys concern, honesty, and professionalism; which builds trust and raises the bar for our profession.

I think it is important for agents and brokers to encourage buyers to consult with their attorney about all agreements before signing them, verbally and in writing, so that it reinforces clear communication and provides a record that such encouragement took place.

Kathleen,

What you say makes sense. You are right. Buyers are usually in a rush to get out the door to look at properties. I think your new approach with the buyer's agreement sounds reasonable, and it gives buyers the opportunity to review it with their attorney. Do you usually pre-qualify buyers at your first meeting?

When I first started out in real estate, I would put any interested "buyer" in my car until I learned how expensive this practice can become. Then I discovered how important it is to uncover motivations upfront, and to determine whether or not a buyer is serious, or whether they are just looking for a free tour of the city or county. Since I only deal with buyers, the process of uncovering motivations upfront is even more acute, and the need for a buyer agency agreement is more pronounced. However, I find that when I explain things to a serious buyer they are pretty understanding. Conversely, when I try to explain this to a buyer who is not serious, they soon reveal themselves.

Evelyn,

I find it very interesting how real estate laws vary from state-to-state, although there are also many similarities. It is exciting to exchange ideas and experiences with peers. We really can learn a lot from each other. :)