In the previous post in this series, "Long Island Homebuyers ~ Buyer Representation," it was discussed that buyer clients have access to information that could give them leverage in contract negotiations.  So far in this series, it has been discussed (in detail), why it is better for buyers to have their own representation.  However, despite all of the advantages that buyer clients have over buyer customers, there are still some common concerns that many Long Island homebuyers share about being contractually obligated to a buyer's agent. 

Long Island homebuyers are accustomed to having the freedom to work with as many agents as they would like to.  Buyers that are comfortable working with a single agent, without having a buyer broker agreement, are missing out on the advantages of having buyer representation.  This may be a case of not knowing about their options, or it may be a choice to not be contractually obligated to one particular agent.

The following is a look at some of the most common concerns that Long Island homebuyers have about buyer representation.

THE CONTRACT - Homebuyers sometimes feel that they have limited flexibility if they are under contract with one agent, asking questions like..."What if things don't work out?  How long will I be "stuck" with this agent?"  With proper due diligence, this shouldn't be an issue.

First of all, the contract length is negotiable, as are the contract terms.  Often times, there will be a termination clause added to the contract to allow either party the right to cancel the contract.  Since this is decided between an agent and a client, there is no "rule of thumb" that can be elaborated upon in this post.

If you are a homebuyer, and you want to make sure that you and the buyer's agent are a good fit, you should interview them the same way that you would if you were listing your home with an agent.  During the interview, any concerns about the contract should be addressed.

COMPETING CLIENTS - When homebuyers choose to have buyer representation, they want to make sure that their interests are protected, and rightfully so.  So what happens when a buyer client is interested in the same home that another client of the buyer agent is also interested in?  Very simply, both clients should receive the same level of service, which includes the following:

• Confidentiality - The buyer agent owes all buyer clients confidentiality.  Neither client will be told what the other client is offering, should both clients be bidding on the same home.

• Disclosure - The buyer agent should provide all of the same information to each client in a timely manner.  While the information won't be provided in the same e-mail or phone call, it should be done at around the same time to ensure fairness to both parties.

Neither client should expect to receive preferential treatment by the buyer agent.  In fact, the process should be handled in the same manner that a listing agent would use if a particular buyer was interested in more than one of the agent's listings.

DUAL AGENCY - The situation may arise where a buyer client is interested in making an offer on one of the listings in the buyer agent's office.  Since all listings are technically with the brokerage, and not with the agent, this would create a dual agency situation.  As long as this is disclosed to both the buyer and the seller, it is perfectly legal in New York State for this to occur. 

The listing agent cannot be the buyer agent in the same transaction.  Should buyer clients be interested in one of their buyer agent's listings, the broker would have to designate another agent to represent one of the parties.  This is because it would be impossible for one agent to provide the same level of service to both the buyer and the seller.

It is best to discuss this situation upon signing a buyer representation agreement to see how the situation will be worked out.  In my opinion, the fairest way to handle this type of scenario is to have the agent continue to represent the client that has been with him the longest, regardless of whether it is the buyer or the seller.  The broker would be responsible for designating another agent with comparable skills to represent either the buyer or the seller. 

It is important to note that all confidential information that was learned about the client by the buyer / listing agent is to remain confidential, and cannot be used during the negotiation process.

This situation occurs far less than most people would expect.  While it is a legitimate concern, it is one that can be overcome as long as all of the proper disclosures are made.

There is one more concern that most Long Island Homebuyers have about buyer representation - COMPENSATION.  The issue of how buyer agents are compensated will be addressed in the next part of this series.