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"Did you sign a Buyer's Brokerage Agreement?"

When you're a Real Estate Agent, you dream of having a Pre-Approved Borrower with a Buyer's Brokerage Agreement every time someone hops into that SUV. It'd be the perfect client every time!

But alas, you live in the "real world" where no one is approved for fear of running & ruining their credit report and no one wants to sign a Buyer's Brokerage Agreement; they're just not ready for that type of commitment. You know, they wanna test the water (so-to-speak) to see if there's anything out there to buy to begin with (something that's within their budget and appealing enough to call "home").

If you're a Real Estate Agent, where do you draw the line? When do you say, "no mas! I won't show you a home without a Buyer's Brokerage Agreement.

If you're the consumer, why won't you ante up? You can be honest...this blog has an "open door" policy.

READ ON

Posted by Ricardo Bueno on 06/11/2008 06:40 AM

Comments (13)

Originally posted at: Ricardo Bueno's Blog : "Did you sign a Buyer's Brokerage Agreement?"

Post is included in group: Realtors®
Post is included in group: Keller Williams 'Rainers

13 Comments on "Did you sign a Buyer's Brokerage Agreement?"

JUN

2008

You still have to build rapport with them... If they are hesitant to sign, I give them one free trip in the SUV. The second will cost them a buyer's rep...

I have had this happen to me too. Usually when we get ready to put in an offer they sign. My customers have been loyal so far

Most of the time, If you ask the right questions, you know what your dealing with early in the process.

Steve: that's true. But as much as you build rapport with someone, there's still that chance they might put in an offer with someone else. On the lending side, when we have a borrower, there's always that chance they might sign closing docs with that company they double-app'd us with. On your end, a buyer's brokerage agreement ensures (to an extent) that you'll get paid.

Charlie: Good for you...you've been fortunate. It's painful when you've been working with a buyer, showing them homes and next thing you know, they go under contract with someone else. As in this case when you click to read on for the rest of the story...

Greg: True. But not eveyone's mastered that art yet. And even when you ask the "right" questions and get the right answers, does that mean you don't have to sign a buyer's brokerage agreement? What happens when they walk and go into escrow with someone else on their side?

Ricardo: There are no guarantees in any business! I lose some business from time-to-time. People are not loyal to anyone any longer. So if that is going to be a big problem for me, perhaps I have chosen the wrong career field...??? Nevertheless, I teach my agents that the REAL problem is not a lack of loyalty, but rather a lack of LEADS. You must generate enough that a few people coming and going is not a problem in your business plan. That is a part of the environment and you have to plan for it. If you brood over the fact that you can close every customer, you will burn out in this career field! I can guarantee it.

Steve: well said! Simply put, we are in the lead generation business...

When a Customer does not want to sign a Buyer Broker Agreement, it usually means they want to leave their options open for working with another Broker. Loyalty works in both directions. If the Customer expects my loyalty, I would like their loyalty in return. A Buyer Broker Agreement locks in the Client/Broker Agency relationship with full representation for the Client.

A Buyer Broker Agreement becomes all the more important when your Buyer purchases a property you showed them through another Broker or after spending a month driving Buyers around only to find out they purchased a FSBO on their way home one evening.

A Buyer Broker Agreement is also important for the Buyer. Here are some of the advantages:

The Broker will

    . . .help the Buyer search and find the right property that is just right.

    . . .expand the search beyond MLS properties to For-Sale-By-Owner, foreclosed properties, bank trusts and new construction that fits the Buyers criteria.

    . . .attempt to discover and reveal to the Buyer facts about specific properties and the owner's motivation that will strengthen negotiations.

    . . .help the Buyer value the property to obtain the best possible price in thieir best interest.

    . . .negotiate on the Buyer's behalf to obtain the best possible terms and conditions to purchase/ he property.

    . . . help the Buyer overcome any obstacles to insure a smooth transaction to closing.

    . . .represent the Buyer on a confidential basis.

    . . .represent the Buyer throughout the whole transaction process.

A Buyer Broker Agreement is advantageous to both the Buyer and the Broker with the end result being a Win-Win situation.

Good Post!

Sorry but I think many buyers have learn how to play the game very well. There is unlimited information posted on just about every real estate site as to buyer agency. Many believe up front it is to their advantage to not commit to a Realtor in some situations. They will sign when it is in their advantage. Most buyers are very well educated today. It is the Realtors who are not educated, most find it easy to jump in the SUV, rather than speak up and pass on the trip, we need to stop being pop tarts to every buyer. Until that can happen the buyer is a free agent, and our endless problem customer.

Ricardo, I love that 50%. Too bad it doesn't work in our industry. aj

Even we have a loyal clients, some can slip away. Having an agreement can up the loyalty, I think.

Nice List Michael. You could probably add a dozen more if you are talking about a relocating buyer.

JUN

2008

Ricardo

A buyer broker agreement is certainly gold. However, getting clients to sign one is difficult. One problem is that there is a level of distrust in our industry from outsiders. I once explained one to a potential client and she called me a used car dealer.

by the way, Do you have an outside blog that I can add to my Blogroll ?

Thanks and look forward to reading your thoughts on the world of real estate.

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