The other day and agent asked me what I thought of Buyer Broker Agreements. He had recently lost a buyer to another agents and felt he needed to do something different. I think he was a little shocked when I told him I would not use one.
In California, we actually have three forms developed by our association. Two are non-exclusive and one is exclusive. The exclusive one is actually 4 pages long and very scary. It has lots of language of what the agent is NOT going to do and very little about what we are going to do. I am bothered by the concept that if the buyer buys anything, anywhere during this contract (defaults) to one year, the agent gets paid his buyer's agent commission, even if the buyer used another broker. It also does not offer an opportunity to fire the agent.
He is my test. Would you sign it if you were a buyer. Let's say you move to another area. You meet an agent who wants you to sign an exclusive agreement, meaning you have to use them, no matter what. Even if this is the world's greatest agent (which is questionable since you just met him) does any agent really know an entire market area. I guess if you know EXACTLY where you want to live, one agent could cover it but in most areas, very few agents are really qualified for the entire market.
But, even if the agent says, Yes, I know every market in the area, what would you gain from giving them an exclusive. Don't you think that most of us would be better off with agents competing against each other . Many times if is a race and another agent knows about a house or neighborhood that the buyer's agent missed. It happens all the time.
For me, I would never sign one .................. and if i am not going to sign it, I will not ask my clients to sign it.
But, there are buyers who use agents. Maybe their agent is not available, on vacation or is a part-timer with no lockbox key. They let some dumb agent (like me) show them houses but call their agent when they find the house they want.
So, what i did was to write a simple one page agreement stating that the buyer can use any agent but agree to use me if I introduce them to the house or show them the house. It is my belief that if a client is a weasel, they will not sign it.